Panel unit root tests of purchasing power parity hypothesis: Evidence from Turkey

Abstract

In this paper, we employ some front page panel unit root tests to examine the validity of the purchasing power parity hypothesis in Turkey. Using monthly observations panel data of nine major county's currency dates January 2003 through April 2010, we find that panel unit root tests rejected the mean-reversion of real exchange rates. Thus, the empirical results indicate significant support for the purchasing power parity holds in Turkey.