Revisiting Purchasing Power Parity of Papua New Guinea

Liew, Venus Khim-Sen and Ling, Tai-Hu and Chia, Ricky Chee-Jiun (2011) Revisiting Purchasing Power Parity of Papua New Guinea. International Proceedings of Economics Development and Research, 2. ISSN 2010-4626

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Abstract

Studies on long-run Purchasing Power Parity (PPP) for Papua New Guinea (PNG), one of the least developed countries in the world, is limited. Unlike the two existing studies, which consistently show no support for PPP, this note uncovers evidence of PPP for Papua New Guinea (PNG). Results from further analysis indicates that nominal exchange rates and relative prices are nonlinearly interrelated. This PPP in nonlinear dynamic fails to be detected in previous studies that did not include nonlinear analysis. Frictions in international trade could be behind the establishment of the above-mentioned nonlinear relationship.

Item Type: Article
Uncontrolled Keywords: Purchasing power parity, Cointegration, Nonlinear, Rank tests, Least Developed country, Papua New Guinea,unimas, university, universiti, Borneo, Malaysia, Sarawak, Kuching, Samarahan, ipta, education, Postgraduate, research, Universiti Malaysia Sarawak
Subjects: H Social Sciences > HC Economic History and Conditions
Divisions: Academic Faculties, Institutes and Centres > Faculty of Economics and Business
Depositing User: Karen Kornalius
Date Deposited: 13 Nov 2015 07:42
Last Modified: 13 Nov 2015 07:42
URI: http://ir.unimas.my/id/eprint/9728

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