International Evidence On Purchasing Power Parity Theory: A Partial Equilibrium Empirical Investigation

Some Evidence of Purchasing Power Parity

Empirical support for purchasing power parity is mixed with results dependent on the time frame and countries under examination, the methodology employed, attempts to control for aggregation bias in the data, and whether adjustments are made to account for productivity differences across nations. As a central component of macroeconomic thinking, purchasing power parity is battered and battle-wo...

Nonlinear Adjustment Towards Purchasing Power Parity

Purchasing Power Parity Theory Determinants –A Swedish Destination Study of International Tourists: a Count Data Approach

This paper employs the time-series negative binomial regression model (TNBM) to test the hypothesis effects of purchasing power parity (PPP) theory on the counts data of visitors to the north-west of Sweden (SW6 region). We consider a sample of monthly time-series count data from 1993:01 to 2008:12 taken from five countries: Denmark, the United Kingdom, Switzerland, Japan and the United States....

Purchasing Power Parity: Evidence from a New Test

Most economists intuitively consider purchasing power parity (PPP) to be true. Nevertheless, quite surprisingly, the empirical literature is not very supportive for PPP. In this paper, however, we …nd evidence in favor of PPP using a new test. The test is embedded in a Markov regime-switching model for the exchange rate, because earlier papers have shown that this model describes the data bette...

The Purchasing Power Parity Debate

Our willingness to pay a certain price for foreign money must ultimately and essentially be due to the fact that this money possesses a purchasing power as against commodities and services in that country. On the other hand, when we offer so and so much of our own money, we are actually offering a purchasing power as against commodities and services in our own country. Our valuation of a foreig...