Testing for PPP using SADC real exchange rates

Mokoena, Thabo Mishack; Gupta, Rangan; Van Eyden, Renee

dc.contributor.author	Mokoena, Thabo Mishack
dc.contributor.upauthor	Gupta, Rangan
dc.contributor.upauthor	Van Eyden, Renee
dc.date.accessioned	2008-09-30T08:26:09Z
dc.date.available	2008-09-30T08:26:09Z
dc.date.issued	2008-06
dc.description.abstract	This paper attempts to provide evidence indicating that the Purchasing Power Parity (PPP) puzzle is becoming less of a puzzle. It present the results of Augmented Dickey- Fuller (ADF) test, nonlinear tests of nonstationarity, and Bayesian unit root tests, applied to ten SADC countries. The Bayesian tests were found to be biased in favour of a trend stationary model in all cases. It is argued that nonlinear approaches to exchange rate adjustments are likely to provide a firmer basis for inference and stronger support for the PPP in the long-term. This is more so at 1 per cent and 5 per cent levels of significance.	en_US
dc.identifier.citation	Mokoena, T, Gupta, R & Van Eyden, R 2008, 'Testing for PPP using SADC real exchange rates', University of Pretoria, Department of Economics, Working paper series, no. 2008-22. [http://web.up.ac.za/default.asp?ipkCategoryID=736&sub=1&parentid=677&subid=729&ipklookid=3]	en_US
dc.identifier.uri	http://hdl.handle.net/2263/7422
dc.language.iso	en	en_US
dc.publisher	University of Pretoria, Department of Economics	en_US
dc.relation.ispartofseries	Working Paper (University of Pretoria, Department of Economics)	en_US
dc.relation.ispartofseries	2008-22	en_US
dc.rights	University of Pretoria, Department of Economics	en_US
dc.subject	Nonlinear nonstationarity tests	en_US
dc.subject	Bayesian unit root test	en_US
dc.subject	Augmented Dickey-Fuller (ADF) test	en_US
dc.subject.lcsh	Purchasing power parity	en
dc.subject.lcsh	Foreign exchange rates	en
dc.title	Testing for PPP using SADC real exchange rates	en_US
dc.type	Working Paper	en_US