Exchange Rate Shock and Its Impact on Import: The Case of Turkey

Year 2019, Volume: 2 Issue: 1, 102 - 112, 21.05.2019

Aydoğan Durmuş

Abstract

Factors affecting foreign trade have always been an area of interest.
Foreign exchange rates are a variable that comes to the fore due to other
factors. In many applied studies, the effects of changes in exchange rates on
imports and exports were examined. In many studies, although there are no
supporting findings, explanatory and contributing results have been reached. In
this study, the volatility of exchange rate was determined by using a new
method, Markov Switching ARCH econometrics, and the effect of foreign exchange
shocks was investigated. As a result of the regression, it was seen that the
import value was affected by the risks caused by the uncertainty of exchange
rate.

Keywords

Exchange rate, import, export, foreign trade

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