Colombian Purchasing Power Parity Analysed Using a Framework of Multivariate Cointegration

Número: 
252
Publicado: 
Clasificación JEL: 
C33, F21, F34
Palabras clave: 
Multivariate Cointegration

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Lina Fernanda Torres-Gutierrez, Gonzalo Ossa-Stipcianos, Edwin Mauricio Parra-Rodriguez, Egberto Alexander Riveros, Alvaro José Martinez-Monroy, Julián Andrés Gomez-Duran, Juan Sebastián Rojas-Moreno

This paper tests for purchasing power parity (PPP) between Colombia and its main trading partners using the Johansen framework of multivariate cointegration. The tests shows that PPP does not hold in the strong sense, but a clear purchasing power relation