On the application of the rank tests for nonlinear cointegration to PPP: The case of Papua New Guinea☆
►We study possible nonlinear cointegrating relations in the context of PPP. ►We identify a possible problem of the rank tests for nonlinear cointegration. ►We suggest solutions to the rank problem we identify. ►We find little evidence for PPP in Papua New Guinea.
Yoon's work was supported by the Research Program 2012 of Kookmin University in Korea. We thank an anonymous referee and Jörg Breitung for their helpful comments. Of course, all errors are our own.
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