publication . Master thesis . 2001

Purchasing power parity a different approach

Open Access Greek
  • Published: 01 May 2001
  • Publisher: Πανεπιστήμιο Πειραιώς
  • Country: Greece
Historically, Purchasing Power Parity (henceforth PPP) provides the simplest explanation of long-run exchange rate determination, according to which the equilibrium exchange rate between domestic and foreign currencies equals the ratio between domestic and foreign prices. A few years ago, PPP validity theory seemed like a fairly dull research topic. On the one hand the unavoidable effects of floating exchange rates made it obvious to even its most stubborn defenders that PPP is not a short-run relationship; depreciation or appreciation of a product does not cancel out exchange rate movements on a monthly or even annual basis. On the other hand, there were neithe...
free text keywords: Purchasing power parity, Foreign exchange, Ισοτιμία αγοραστικής δύναμης, Συνάλλαγμα
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Master thesis . 2001
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