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Analysis of Purchasing power parity with data for Macedonia

Author

Listed:
  • Josheski, Dushko
  • Koteski, Cane

Abstract

This paper examines PPP parity theory with data for Macedonia. We test the empirical consensus in this literature that real exchange rates tend towards PPP in the very long run, also we use co-integration Engle-Granger method and error correction mechanism. The hypothesis we test that PPP theory holds in long run in the case of Macedonia, and this hypothesis is proven to be true.

Suggested Citation

  • Josheski, Dushko & Koteski, Cane, 2011. "Analysis of Purchasing power parity with data for Macedonia," MPRA Paper 32023, University Library of Munich, Germany, revised 2011.
    • Handle: RePEc:pra:mprapa:32023
    as

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    File URL: https://mpra.ub.uni-muenchen.de/32023/1/MPRA_paper_32023.pdf
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    References listed on IDEAS

    as
    1. Mr. Aasim M. Husain & Mr. Ashoka Mody & Nienke Oomes & Mr. Robin Brooks & Mr. Kenneth Rogoff, 2003. "Evolution and Performance of Exchange Rate Regimes," IMF Working Papers 2003/243, International Monetary Fund.
    2. repec:ebl:ecbull:v:6:y:2008:i:32:p:1-8 is not listed on IDEAS
    3. Bogoev, Jane & Bojceva Terzijan, Sultanija & Égert, Balázs & Petrovska, Magdalena, 2008. "Real Exchange Rate Dynamics in Macedonia: Old Wisdoms and New Insights," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 2, pages 1-19.
    4. Ahmad Zubaidi Baharumshah & Darja Borsic, 2008. "Purchasing power parity in Central and Eastern European countries," Economics Bulletin, AccessEcon, vol. 6(32), pages 1-8.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. A. Oznur Umit, 2016. "Stationarity of Real Exchange Rates in the ¡°Fragile Five¡±: Analysis with Structural Breaks," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 8(4), pages 254-270, April.

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    More about this item

    Keywords

    PPP; Exchange rate; Co-integration; unit root; stationarity;
    All these keywords.

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General
    • G0 - Financial Economics - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

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