Reassessment of the PPP by error correction mechanism for the Turkish case

Date
1990
Advisor
Togan, Sübidey
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Publisher
Bilkent University
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Language
English
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Thesis
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Abstract

In this study, most popular exchange determination policy, PPP has been tested for the long-run equilibrium. For the test of long-run equilibrium, autoregressive distributed lag model is constructed and the model is estimated using cointegration test and error correction frameworks. The present study tests PPP within the time periods January 1980 to December 1989 for the TL/USD and the TL/DM cases separately. The findings of the study suggest that in Turkey, PPP will not hold even in the long-run.

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Keywords
Purchasing power parity, Long-run equilibrium, Autoregressive distributed lag model,, Cointegartion test, Error-correction mechanism
Citation
Published Version (Please cite this version)