Convergence in Car Prices Among European Countries
Documento De Trabajo Paper No. 517
60 Pages Posted: 3 May 2011
Date Written: April, 29 2011
This paper contributes to the literature on convergence of prices in Europe by investigating the existence of stochastic and deterministic convergence of car prices in the EU15 countries over the period 1993-2008. For that purpose, we conduct unit root testing by employing the recently developed panel stationarity test of Carrion-i-Silvestre et al. (2005) which assumes a highly flexible trend function by incorporating an unknown number of structural breaks which are searched endogenously without using a priori information.
Keywords: Market integration, Automobiles, European Union, Stochastic convergence, Deterministic convergence, Panel stationarity
JEL Classification: C23, F15, F30
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