Validity of the purchasing power parity theory in the euro area

摘要

The aim of this paper is to provide evidence concerning the validity of the purchasing power parity (PPP) in the euro area. By applying unit root tests we find evidence of the PPP for the panel of the 12 euro area countries over the period 1970 - 2017, more concretely for the real exchange rates of Austria, the Belgium-Luxembourg Union and Ireland.