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Table 2 Estimation results for the coefficient on the dollar-denominated Mexican price level: ADL model with and without instruments

From: Purchasing power parity in Mexico since 1933

ADL No IVa IV14 IV15 IV16 IV17 IV18 IV19 IV20 IV21 IV22 IV23 IV24
FMEX1 −0.0338 0.0693 −0.0525 −0.0346 −0.0400 −0.0309 −0.0281 −0.0262 −0.0178 −0.0334 −0.0094 0.0050
−4.212 −0.977 −0.729 −0.488 −0.567 −0.410 −0.360 −0.269 −0.147 −0.284 −0.0489 0.0185
FMEX2 −0.0333 0.0705 −0.0531 −0.0351 −0.0401 −0.0309 −0.0281 −0.0268 −0.0193 −0.0355 −0.0132 −0.0012
−4.179 −1.015 −0.755 −0.507 −0.585 −0.426 −0.375 −0.292 −0.170 −0.325 −0.076 −0.005
FMEX3 −0.0441 0.0436 −0.0326 −0.0175 −0.0227 −0.0140 −0.0114 −0.0061 −0.0037 −0.0184 0.0050 0.0118
−4.372 −0.478 −0.343 −0.188 −0.244 −0.143 −0.111 −0.049 −0.027 −0.137 0.025 0.049
  1. aCritical values for the ADL model without IVs are based on the t statistic bounds test (unrestricted intercept, no trend) of Pesaran et al. (2001). A t statistic smaller than the I(1) bound of −3.53 (−4.10) indicates significance at the 5% (1%) level. The coefficient italicized in bold font is from the equation that minimizes the sum of the squared residuals