Exchange Rate Uncertainty in Turkey and its Impact on Export Volume

Download
2005-6
KASMAN, Adnan
KASMAN, Saadet
This paper investigates the impact of real exchange rate volatility on Turkey’s exports to its most important trading partners using quarterly data for the period 1982 to 2001. Cointegration and error correction modeling approaches are applied, and estimates of the cointegrating relations are obtained using Johansen’s multivariate procedure. Estimates of the short-run dynamics are obtained through the error correction technique. Our results indicate that exchange rate volatility has a significant positive effect on export volume in the long run. This result may indicate that firms operating in a small economy, like Turkey, have little option for dealing with increased exchange rate risk.

Suggestions

Exchange rate pass-through to domestic prices in Turkish economy
Alper, Koray; Gaygısız Lajunen, Esma; Department of Economics (2003)
In this study, determinants and the evolution of the exchange rate passthrough to domestic inflation in the Turkish economy is analyzed. The analyses cover the 1987-2003 period. In the analyses, single equation أError Correction Modelsؤ are used to estimate the exchange rate pass-through. Estimation results suggest that alike other emerging countries, the degree of exchange rate passthrough to domestic prices is high and the pass-through is completed in a very short time span. Estimations results also indic...
Exchange rate pass-through and inflation targeting
Gülşen, Eda; Özmen, Erdal; Department of Economics (2009)
In this study, we aim to investigate the impact of inflation targeting (IT) and the recent global disinflation on exchange rate pass-through (ERPT) using quarterly data from 1980:1 to 2009:1 for 51 industrial and emerging market (EM) countries. To this end, we employ not only the conventional panel data estimation methods but also the recent Common Correlated Effects Pooled estimation procedure by Pesaran (2006) which allows estimating the impact of common global shocks such as global inflation. We also exp...
Exchange Rate Regimes and Business Cycles: An Empirical Investigation
Erdem, Fatma Pinar; Özmen, Erdal (2015-11-01)
This paper empirically investigates the impacts of domestic and external factors along with exchange rate regimes (ERRs) on business cycles in a large panel of advanced and emerging market economies (EME). The results for classical business cycles suggest that EME tend to experience much deeper recessions and relatively steeper expansions during almost the same duration. The probability of expansions significantly increases with ERR flexibility. Our results strongly support floating ERR for both advanced an...
Exchange Rate Pass-Through in Turkey: An Empiricial Investigation
Pekbaş, Melek Özgür; Özmen, Adalı; Department of Economics (2004)
This study investigates the degree of exchange rate pass-through to prices in different sectors for Turkish economy using Johansen Cointegration procedure. The study is based on quarterly data from 1994:1 to 2003:4. In this study it is concluded that the long-run exchange rate pass-through to overall wholesale prices for Turkey is very high and nearly complete. High pass-through degrees are also valid for different sub-sectors wholesale prices like private, public, manufacturing industry and energy. Moreove...
Economic uncertainty and credit crunch - Evidence from an emerging market
Rhoades, SD; Güner, Zehra Nuray (Informa UK Limited, 2003-07-01)
Using both univariate and multivariate analyses, this paper attempts to determine whether a credit crunch occurred in the Turkish economy during the 1990s. It also addresses the question of whether this credit crunch was a supply-side- or a demand-side-originated phenomenon. Economic uncertainty is proxied by unanticipated inflation. The analyses are carried out by controlling for political uncertainty as well. The results indicate that economic uncertainty has a significantly negative impact on the supply ...
Citation Formats
A. KASMAN and S. KASMAN, “Exchange Rate Uncertainty in Turkey and its Impact on Export Volume,” ODTÜ Gelişme Dergisi, vol. 32, no. 1, pp. 58–41, 2005, Accessed: 00, 2020. [Online]. Available: http://www2.feas.metu.edu.tr/metusd/ojs/index.php/metusd/article/view/48/48.