Does PPP hold in the transition economies? The case of poland Hungary

Thacker, Nita

doi:10.1080/00036849500000134

Cited by 28 publications

(11 citation statements)

References 17 publications

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“…These authors also find that pass-through peaks after twelve months. Thacker (1995) provides evidence of limited pass-through in transition countries.…”

Section: The Pass-through Literaturementioning

confidence: 96%

Exchange rate pass-through and monetary policy in Croatia

Billmeier

Bonato

2004

Journal of Comparative Economics

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“…These authors also find that pass-through peaks after twelve months. Thacker (1995) provides evidence of limited pass-through in transition countries.…”

Section: The Pass-through Literaturementioning

confidence: 96%

Exchange rate pass-through and monetary policy in Croatia

Billmeier

Bonato

2004

Journal of Comparative Economics

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“…11 In particular: Thacker (1995) tests for stationarity of the real exchange rates of Poland and Hungary and rejects the hypothesis. Choudhry (1999) tests for cointegration between relative prices and nominal exchange rates of the currencies of Poland, Romania, Russia and Slovenia vis-a-vis the US$.…”

Section: Exchange Rate Policies In the Selected Economiesmentioning

confidence: 98%

Foreign exchange intervention and equilibrium real exchange rates

Sideris

2008

Journal of International Financial Markets, Institutions and Mo

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Monetary authorities intervene in the currency markets in order to pursue a monetary rule and/or to smooth exchange rate volatility caused by speculative attacks. In the present paper we investigate for possible intervention effects on the volatility of nominal exchange rates and the estimated equilibrium behaviour of real exchange rates. The main argument of the paper is that omission of intervention effects -when they are significant -would bias the ability to detect any PPP-based behaviour of the real exchange rates in the long run. Positive evidence for this argument comes from the experience of six Central and Eastern European economies, whose exchange markets are characterised by frequent interventions.

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“…Failure to reject the hypothesis that the real exchange rate follows a random walk implies exchange rates and prices tend to drift apart without bound. Thacker (1995) tested for stationarity in the real exchange rates of Poland and Hungary, but found no support for PPP.…”

Section: Unit Root Testing Of Exchange Ratesmentioning

confidence: 95%

Capital flows, real exchange rate misalignment and PPP tests in emerging market countries

Kargbo

2011

Applied Economics

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The economic performance of emerging markets has significant impacts on economic growth and volatility of macroeconomic indicators in various countries. Emerging markets accounted for 20-43% of global exports during the period 1970-2005, and held 70% of global foreign reserves in recent years. More than 50% of the exports from the Euro area, Japan and the United States go to emerging markets and other developing countries. The globalization of capital flows is facilitated by technological innovations and excellent information networks, coupled with sharp increases in savings that are directed into financial instruments across borders. The use of Purchasing Power Parity (PPP) as a benchmark in exchange rate policy reforms assumes the existence of a stable relationship between the exchange rate and the ratio of price levels in two countries. This article investigates whether or not long-run PPP holds in emerging markets. Johansen's cointegration technique is used with annual data in analysing the relationship between exchange rates and the CPI during the period 1951-2005. We found overwhelming support for long-run PPP in emerging markets, thus, PPP is a reliable guide for exchange rate determination and exchange rate policy reforms in these countries.

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Does PPP hold in the transition economies? The case of poland Hungary

Cited by 28 publications

References 17 publications

Exchange rate pass-through and monetary policy in Croatia

Exchange rate pass-through and monetary policy in Croatia

Foreign exchange intervention and equilibrium real exchange rates

Capital flows, real exchange rate misalignment and PPP tests in emerging market countries

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