ANALYSIS OF THE RELATION BETWEEN INFLATION AND FOREIGN EXCHANGE RATES FOR THE NORTHERN REGION OF IRAQ
Öz
The purpose of this study is to examine the relation
between the inflation rate, foreign exchange rates of the major currencies used
in the northern region of Iraq (NRI), money supply and gross domestic product
(GDP) for the period 2008-2016. It is notable that the region suffers from high inflation rates and
there were fluctuations in foreign exchange rates after the fall of the former
Iraqi regime in 2003. This is the first article about this subject for NRI using
an error correction model and the results indicate that there is a long-run
relation between variables. The relation between US Dollar and inflation in the
region is positive and statistically significant. There is a negative relation
between Euro and inflation, which is also statistically significant. NRI
imports many goods and services from Turkey, but a surprising result is that
the Turkish Lira variable is not statistically significant. This may be due to
the fact that import payments are done with Dollars and not Turkish Liras. There
is also a negative long-run relation for the variables GDP and money supply,
which are not statistically significant. In the analysis, money supply by the
Iraqi Central Bank was used as the money supply variable, but the amount of
money supply in the NRI is not proportional to the amount offered by the
Central Bank, there is no advanced banking system in the region. The amount of
Dinar coming into the region consists of converting the oil export revenues
into Iraqi dinar and supplying these Dinars as payments to the market.
Therefore, the NRI money supply will depend on the oil revenues and the Dollar,
which makes money supply variable statistically insignificant.
Kaynakça
- Abbas, S. N. (2008). The Effect of Inflation on the Exchange Rate of the Iraqi Dinar for the Pe-riod 1990 - 2005. Journal of Baghdad college of economic sciences, 6.Akaike, H. (1998). Information theory and an extension of the maximum likelihood principle. In Selected papers of hirotugu akaike (pp. 199-213). Springer, New York, NY.Al-Qaisi, Q. S. (2005). Activitating the Monetary Policy in Dealing Inflation with Particular Ref-erence to Iraq for the Period 1981 - 2001. Baghdad: University of Mustansiriya College Manage-ment and Economics - Badgdad.Al-Wondawi, N. M. (2010). Measuring the Effect of the General level of Prices and the Presantation of Cash on Exchange Rate of the Iraqi Dinar for the Period 1980 - 2002. Journal of Administration and Economics University of Karbala, 113.Aqrawi, F. A. E. (2018). The analysis of relationship between inflation and foreign exchange rates in the Northern region of Iraq for the period (2008 - 2016). https://tez.yok.gov.tr/Ulusal TezMerkezi/TezGoster?key=hcgrYffRbz0Z44UJEuLtwTcB2x2fzSHPc6lwliwiicSay8YCDkn72nHiYSD9PQ sa. Siirt: Institute of Social Sciences.Badawah, S. O. (2015). Analysis of the Relationship Between Foreign Exchange Rate and Infla-tion Rate. Iraqi Journal for Economic Sciences, 141.Benk, S., Gillman, M., & Kejak, M. (2010). A banking explanation of the US velocity of money: 1919–2004. Journal of Economic Dynamics and Control, 34 (4), 765-779.Brau, E. H. (1971). The Variability of Velocity and Credit Ceilings. International Monetary Fund. 18 (3), 473-507.Central Bank of Iraq Annual Report. (2018). Annual Report of Iraq. Bagdad: Central Bank Iraqi.Dickey, D., & Fuller, W. (1981). Likelihood Ratio Statistical for Autorgressive Time Series with a Unit Root. Econometrica: Journal of Econometric Society, 1057-1072.Eas, A. K. (2013). Analysis of Inflation Rate in Iraq for Period 2000 - 2010. Journal of Baghdad College of Economic Sciences, 46.Fisher, Irving (1963). The Purchasing Power of Money. New York: Kelley.Hannan, E. J., & Quinn, B. G. (1979). The determination of the order of an autoregression. Journal of the Royal Statistical Society: Series B (Methodological), 41(2), 190-195.Johansen, S. (1991). Estimation and hypothesis testing of cointegration vectors in Gaussian vector autoregressive models. Econometrica: Journal of the Econometric Society, 1551-1580.Khanjar, M. M. (2010). Pathways of Inflation in the Iraqi Economy for the Period 1990 - 2007. Badgdad: University of Mustansiriya College Management and Economics - Badgdad.KRG. (2017a). Ministry of Planning, Region’s Statistics Authority, Consumer Price Index Unit. Erbil: Ministry of Planning.KRG. (2017b). Ministry of Commerce and Industry, Directorate of General Trade, Chamber of Commerce and Industry in Erbil, Sulaymaniyah, and Duhok. Unpublished records., Erbil, Sulaymaniyah, and Duhok.MIT. (2019). Where does Iraq import from? (2007-2017). https://atlas.media.mit.edu/en/visualize/stacked/hs92/import/irq/show/all/2007.2017/. (24.02.2019)Omar, L. O. (2017). Analaysis of consumer price indices in Erbil governorate for the period 2009 - 2015. Journal of Anbar University for Economic and Administrative, 217.Pesaran, M.H., Shin, Y., & Smith, R.J. (2001). Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics 16, 289–326.Phillips, R., & Perron, P. (1988). Testing for a Unit Root in Time Series Regression. Biometrika, 57, 335 - 346.Schwarz, G. (1978). Estimating the dimension of a model. The annals of statistics, 6(2), 461-464.Smaail, K. K. (2008). Impact of Iraqi Dinar Exchange Rate in Commercial (Internal and External) for Erbil city during 1994 – 2006. Erbil: Salahaddin University – Erbil.Watson, P., & Teelucksingh, S. (2002). A Practical Introduction to Econometric Methods: Clas-sical and Modern. Indies: The University of the WestIndies Press.
ANALYSIS OF THE RELATION BETWEEN INFLATION AND FOREIGN EXCHANGE RATES FOR THE NORTHERN REGION OF IRAQ
Öz
Bu çalışmanın amacı; enflasyon, Irak'ın kuzey
bölgesinde (IKB) kullanılan ana para birimlerinin döviz kurları, para arzı ve
gayri safi yurtiçi hasıla (GSYH) değişkenleri arasındaki ilişkiyi 2008-2016
dönemi için incelemektir. Bölgenin yüksek enflasyon oranından muzdarip olması
ve 2003 yılında eski Irak rejiminin düşmesinden sonra döviz kurlarında dalgalanmalar
olması dikkat çekicidir. Bu çalışma, IKB için bir hata düzeltme modeli kullanan
konudaki ilk makaledir. Sonuçlar değişkenler arasında uzun vadeli bir ilişki
olduğunu göstermektedir. ABD Doları ile bölgedeki enflasyon arasındaki uzun
vadeli ilişki pozitif ve istatistiksel olarak anlamlıdır. Euro ile enflasyon
arasında negatif bir ilişki vardır ve bu istatistiksel olarak anlamlıdır. IKB
Türkiye'den birçok mal ve hizmet ithal ediyor olmasına rağmen şaşırtıcı bir
sonuç, Türk lirası değişkeninin istatistiksel olarak anlamlı olmaması. Bunun
sebebi, ithalat ödemelerinin Türk Lirası ile değil Dolar ile yapılması
nedeniyle olabilir.
Anahtar Kelimeler
Inflation Rate Foreign Exchange Rate Money Supply GDP Error Correction Model
Kaynakça
- Abbas, S. N. (2008). The Effect of Inflation on the Exchange Rate of the Iraqi Dinar for the Pe-riod 1990 - 2005. Journal of Baghdad college of economic sciences, 6.Akaike, H. (1998). Information theory and an extension of the maximum likelihood principle. In Selected papers of hirotugu akaike (pp. 199-213). Springer, New York, NY.Al-Qaisi, Q. S. (2005). Activitating the Monetary Policy in Dealing Inflation with Particular Ref-erence to Iraq for the Period 1981 - 2001. Baghdad: University of Mustansiriya College Manage-ment and Economics - Badgdad.Al-Wondawi, N. M. (2010). Measuring the Effect of the General level of Prices and the Presantation of Cash on Exchange Rate of the Iraqi Dinar for the Period 1980 - 2002. Journal of Administration and Economics University of Karbala, 113.Aqrawi, F. A. E. (2018). The analysis of relationship between inflation and foreign exchange rates in the Northern region of Iraq for the period (2008 - 2016). https://tez.yok.gov.tr/Ulusal TezMerkezi/TezGoster?key=hcgrYffRbz0Z44UJEuLtwTcB2x2fzSHPc6lwliwiicSay8YCDkn72nHiYSD9PQ sa. Siirt: Institute of Social Sciences.Badawah, S. O. (2015). Analysis of the Relationship Between Foreign Exchange Rate and Infla-tion Rate. Iraqi Journal for Economic Sciences, 141.Benk, S., Gillman, M., & Kejak, M. (2010). A banking explanation of the US velocity of money: 1919–2004. Journal of Economic Dynamics and Control, 34 (4), 765-779.Brau, E. H. (1971). The Variability of Velocity and Credit Ceilings. International Monetary Fund. 18 (3), 473-507.Central Bank of Iraq Annual Report. (2018). Annual Report of Iraq. Bagdad: Central Bank Iraqi.Dickey, D., & Fuller, W. (1981). Likelihood Ratio Statistical for Autorgressive Time Series with a Unit Root. Econometrica: Journal of Econometric Society, 1057-1072.Eas, A. K. (2013). Analysis of Inflation Rate in Iraq for Period 2000 - 2010. Journal of Baghdad College of Economic Sciences, 46.Fisher, Irving (1963). The Purchasing Power of Money. New York: Kelley.Hannan, E. J., & Quinn, B. G. (1979). The determination of the order of an autoregression. Journal of the Royal Statistical Society: Series B (Methodological), 41(2), 190-195.Johansen, S. (1991). Estimation and hypothesis testing of cointegration vectors in Gaussian vector autoregressive models. Econometrica: Journal of the Econometric Society, 1551-1580.Khanjar, M. M. (2010). Pathways of Inflation in the Iraqi Economy for the Period 1990 - 2007. Badgdad: University of Mustansiriya College Management and Economics - Badgdad.KRG. (2017a). Ministry of Planning, Region’s Statistics Authority, Consumer Price Index Unit. Erbil: Ministry of Planning.KRG. (2017b). Ministry of Commerce and Industry, Directorate of General Trade, Chamber of Commerce and Industry in Erbil, Sulaymaniyah, and Duhok. Unpublished records., Erbil, Sulaymaniyah, and Duhok.MIT. (2019). Where does Iraq import from? (2007-2017). https://atlas.media.mit.edu/en/visualize/stacked/hs92/import/irq/show/all/2007.2017/. (24.02.2019)Omar, L. O. (2017). Analaysis of consumer price indices in Erbil governorate for the period 2009 - 2015. Journal of Anbar University for Economic and Administrative, 217.Pesaran, M.H., Shin, Y., & Smith, R.J. (2001). Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics 16, 289–326.Phillips, R., & Perron, P. (1988). Testing for a Unit Root in Time Series Regression. Biometrika, 57, 335 - 346.Schwarz, G. (1978). Estimating the dimension of a model. The annals of statistics, 6(2), 461-464.Smaail, K. K. (2008). Impact of Iraqi Dinar Exchange Rate in Commercial (Internal and External) for Erbil city during 1994 – 2006. Erbil: Salahaddin University – Erbil.Watson, P., & Teelucksingh, S. (2002). A Practical Introduction to Econometric Methods: Clas-sical and Modern. Indies: The University of the WestIndies Press.
Ayrıntılar
| Birincil Dil | İngilizce |
|---|---|
| Bölüm | MAKALELER |
| Yazarlar | |
| Yayımlanma Tarihi | 24 Temmuz 2019 |
| Yayımlandığı Sayı | Yıl 2019 Sayı: 24 |
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