8th International Thematic Monograph – Modern Management Tools and Economy of Tourism Sector in Present Era

Purchasing Power Parity in B5 Countries: How Important Are Tourism Prices?

Jani Bekő  –   University of Maribor, Faculty of Economics and Business, Slovenia
Darja Boršič   –   University of Maribor, Faculty of Economics and Business, Slovenia

​​DOI:   https://doi.org/10.31410/tmt.2023-2024.61  
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8th International Thematic Monograph –   Modern Management Tools and Economy of Tourism Sector in Present Era, Belgrade, 2023/2024,   Published by:  Association of Economists and Managers of the Balkans in cooperation with the Faculty of Tourism and Hospitality, Ohrid, North Macedonia;   ISSN 2683-5673,  ISBN  978-86-80194-81-3 ;  Editors:  Vuk Bevanda, associate professor, Faculty of Social Sciences, Belgrade, Serbia;   Snežana Štetić, full time professor, The College of Tourism, Belgrade, Serbia,   Printed by:  SKRIPTA International, Belgrade  
Abstract:  This chapter examines the PPP hypothesis in five Balkan countries (B5). The current analysis incorporates four important novelties. First, from a methodological standpoint, the PPP is scrutinized by a range of first-gener­ation and second-generation panel unit root tests. Additionally, three pan­el cointegration tests are performed: the Pedroni residual cointegration test, the Kao residual cointegration test and the Johansen Fisher cointegration test. Second, the study utilizes two price indicators: the consumer price index for hotels and restaurants and the general consumer price index. Third, the PPP proposition for the Balkan economies is inspected using a new, updated data set covering the period from January 2006 to December 2023. Fourth, two nu­meraire currencies, the euro and the USD, are operated to assess the validity of exchange rate parity conditions. The econometric results provide resolute support for the PPP concept in the group of B5 countries.​

Keywords:   Panel unit root tests; Panel cointegration tests; Tourism sector; Consumer price indices for hotels and restaurants

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