Real exchange rate stationarity in developing countries a new panel test.

From: Journal of Academy of Business and Economics | Date: February 1, 2003| Author: Hassanain, K. | Copyright information

ABSTRACT

This article examines the mean reversion behavior of the real exchange rate for panels with cross sectional dependency. The study is conducted using a newly developed nonlinear IV unit root test for a panel of 41 developing countries. The test allows for a general dependency structure among the innovations that generate data for each of the cross-sectional units, is asymptotically normal, and does not require any tabulation of the critical values. Using the US d...

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