Purchasing Power Parity in the Case of Romania: Evidence from Structural Breaks

Oğuz Öcal

International Journal of Economics and Financial Issues, 2013, vol. 3, issue 4, 973 - 976

Abstract: Purchasing Power Parity has most likely been one of the most investigated issues of the last decades within economic literature. The results from such studies are not consistent and not only important for policy makers and economists but also extremely important for policy implications in international finance. Purchasing Power Parity states the exchange rate between two countries should reflect the relative purchasing power of these two countries. This study tests the validity of the purchasing power parity hypothesis in Romania with employing Zivot Andrews unit root test by taking structural break into account. We use annual data from 1991 to 2012 and the results show that purchasing power parity does not hold in Romania.

Keywords: Purchasing power parity; real exchange rates; structural breaks (search for similar items in EconPapers)
JEL-codes: F30 F31 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.econjournals.com/index.php/ijefi/article/download/620/pdf (application/pdf)
http://www.econjournals.com/index.php/ijefi/article/view/620/pdf (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eco:journ1:2013-04-21

Access Statistics for this article

International Journal of Economics and Financial Issues is currently edited by Ilhan Ozturk

More articles in International Journal of Economics and Financial Issues from Econjournals
Bibliographic data for series maintained by Ilhan Ozturk ().