Absolute purchasing power parity in industrial countries

Zhibai Zhang and Zhicun Bian

MPRA Paper from University Library of Munich, Germany

Abstract: Different from popular studies that focus on relative purchasing power parity, we study absolute purchasing power parity (APPP) in 21 main industrial countries. Three databases are used. Both the whole period and the sub-period are analyzed. The empirical proof shows that the phenomenon that APPP holds is common, and the phenomenon that APPP does not hold is also common. In addition, some country pairs and the pooled country data indicate that the nearer the GDPPs of two countries are, the more valid APPP between the two countries is.

Keywords: Absolute purchasing power parity; Real exchange rate; Coefficient restriction test (search for similar items in EconPapers)
JEL-codes: F3 (search for similar items in EconPapers)
Date: 2015-08
New Economics Papers: this item is included in nep-ger and nep-opm
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Citations: View citations in EconPapers (1)

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https://mpra.ub.uni-muenchen.de/72788/1/MPRA_paper_72788.pdf revised version (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:66241

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