Purchasing Power Parity in Scandinavian Countries: Multi-Period Approach

Abstract

This paper investigate the idea of PPP for Scandinavian countries for the period 1946-2015. The dynamic properties of PPP is examined by graphical analysis and ADF test. Johansen test is applied to asses the long-run relationship between exchange rates and relative price levels. This paper nds partial support for the PPP hypothesis. That is, for both currency pairs, the PPP is supported only in one sub-sample while not in other sub-samples.

Denne oppgaven tar for seg hypotesen om kj pekraftsparitet mellom nordiske land for perioden 1946-2015. De dynamiske egenskapene til PPP er studert ved gra ske analyser og ADF test. Johansen test er anvendt for a studere den langsiktige relasjonene mellom valutakurser og relative priser. Denne oppgaven konkluderer at kj pekratspariteten holder for begge valuta-par men kun i en periode.