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Does the Long-Run Ppp Hypothesis Hold for Africa? Evidence From Panel Co-Integration Study

This paper addresses whether parallel market exchange rates in Africa behave in the long run in a manner consistent with the purchasing power parity (PPP) hypothesis. A recent econometric method, the panel co-integration test, enables us to examine the long-run PPP hypothesis by pooling the time-ser...

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Bibliographic Details
Main Author: Nagayasu, Jun
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 1998
Series:IMF Working Papers
Subjects:
National Government Expenditures And Related Policies: Infrastructures
Exchange Rate Arrangements
Public Finance & Taxation
Currency; Foreign Exchange
Purchasing Power Parity
Other Public Investment And Capital Stock
Expenditure
Foreign Exchange
Multiple Or Simultaneous Equation Models: Models With Panel Data
Exchange Rate Flexibility
Public-private Sector Cooperation
Exchange Rates
Public Investment And Public-private Partnerships (ppp)
Public Finance
South Africa
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
Description
Summary:This paper addresses whether parallel market exchange rates in Africa behave in the long run in a manner consistent with the purchasing power parity (PPP) hypothesis. A recent econometric method, the panel co-integration test, enables us to examine the long-run PPP hypothesis by pooling the time-series data of several countries. This approach is particularly useful when analyzing African countries, which often do not have long time series. Using pooled data for 16 African countries, the study concludes that the behavior of parallel market exchange rates in Africa is consistent with the long-run PPP hypothesis
Physical Description:22 pages
ISBN:9781451854589

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