Recent advances in testing for the validity of Purchasing Power Parity (PPP) focus on the time series properties of …

real-time data is slightly lower than the revision in World Bank estimates and much lower than International Monetary Fund …

theory for persistence have some modest support: in the data, the stickier is the price of a good the more persistent is its … real exchange rate, but the theory predicts much more variation in persistence than is in the data. The predictions of the … theory for volatiity fare less well: in the data, the stickier is the price of a good the smaller is its conditional variance …