EMPRICAL EXAMINATION OF THE TURKISH TRADE DEFICIT

Yıl 2018, Cilt: 3 Sayı: 1, 55 - 78, 31.08.2018

Hasan Alpagu Murat İşıker

https://doi.org/10.21733/ibad.2169

Öz

The objective of this
study is to investigate Turkey’s trade deficit through examining the dynamics
of trade balance in order to understand which of the variables deteriorate this
deficit and also in what manner these variables affect trade balance. In this
respect, the real exchange rate effect on trade balance both in the short run
and long run has been examined by using quarterly data set from 1992 to 2011
for Turkey. The Vector Error Correction Model (VECM) is applied with Johansen
co-integration analysis, Granger causality test and generalized impulse
response analysis. According to Johansen cointegration analysis, under trace
and maximum eigenvalue tests variables found cointegrated which means there is
long run relationship among variables. This result enables us to apply VECM.

Anahtar Kelimeler

Trade deficit, VECM, Johansen co-integration analysis, J Curve

Kaynakça

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