Long-Run Purchasing Power Parity with Asymmetric Adjustment: further evidence from African countries
Resource
Applied Economics
Journal
Applied Economics
Pages
231-242
Date Issued
2009
Date
2009
Author(s)
Chang, Tsangyao
Lub, Yang-Cheng
Tang, D. P.
Liu, Wen-Chi
Abstract
This study applies threshold cointegration test advanced by Enders and Siklos (2001 Enders, W and Siklos, PL. 2001. Cointegration and threshold adjustment. Journal of Business and Economic Statistics, 19: 166–76. [Taylor & Francis Online], [Web of Science ®] , [Google Scholar]) to investigate the properties of asymmetric adjustment in long-run Purchasing Power Parity (PPP) in 22 selected African countries during the period of January 1980 to December 2003. Although there is evidence of long-run PPP for most African countries, the adjustment mechanism is asymmetric. These results have particularly important policy implications for African countries.
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Type
journal article
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