Test on Purchasing Power Parity Hypothesis in China: An Empirical Study

摘要：

Purchasing power parity (PPP) is an important economic technique used to measure the relative values of two currencies. In this paper we use econometric methods such as Augmented Dickey Fuller unit root tests and Engle-Granger cointegration tests to explore the Chinese PPP hypothesis relative to U.S. during the period from January 1994 to December 2006. The results show that, due to Chinas evolution of exchange control system in the context of the overall reform, we couldnt get strong support of PPP hypothesis, i.e., PPP is just one of the factors reflecting the exchange level in China and we couldnt determine the nominal exchange rate depending on it alone. This is consistent with the Chinese economy.

关键词： Purchasing Power Parity Exchange Rate Real Exchange Rate Testing Inflation Rate

作者: Zhu Huiming Hao Liya

作者单位: College of Business Administration, Hunan University, Changsha 410082, China

会议类型: 国际会议

会议名称: The 15th International Conference on Industrial Engineering and Engineering Management(IE&EM2008)(第十五届工业工程与工程管理国际学术会议暨中国机械工程学会第11次工业工程年会)

会议地点: 郑州

会议语种:英文

在线出版日期: 2008-09-20（万方平台首次上网日期，不代表论文的发表时间）