Dealing with Methodological Problems when Testing for Purchasing Power Parity: Evidence from Greece

Dimitrios Sideris

Economia Internazionale / International Economics, 2000, vol. 53, issue 3, 389-407

Abstract: Problems faced by empirical studies of the purchasing power parity (PPP) hypothesis are: the choice between a multilateral and a bilateral approach, the choice of the appropriate price index and the problem of the simultaneous determination of prices and exchange rates. In the present paper, we analyse the implications of these problems when testing for PPP between Greece and its major trading partners during the recent floating exchange rate period. Long-run PPP is tested as a cointegrating relationship by applying the Johansen technique.

JEL-codes: C32 C52 F31 (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:ecoint:0243

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