The Effects of Exchange Rate Fluctuations on Corporations and Evidence from Turkey

Ali Hakan Mutluay and Tuncay Turan Turaboglu

Journal of BRSA Banking and Financial Markets, 2013, vol. 7, issue 1, 59-78

Abstract: This study analyzed the effects of exchange rate fluctuations on firms. To this end, the effects of exchange rate fluctuations on the performance of publicly traded firms which are registered to Istanbul Stock Exchange (ISE) are investigated. This relationship is analyzed through regression models of both Adler and Dumas (1984) and Jorion (1990) using the data for the period between 1997 and 2007 on 55 publicly traded firms. The ampirical results show that the exchange rate fluctuations affect firm’s performance with some time lag. Morever, the effect of exchange rate fluctuations on firm performance, negatively depends on the share of export in total sales. Firms with higher export share are more vulnerable to exchange rate fluctuations.

Keywords: Foreign Exchange; Foreign Exc. Exposures; Corporate Performance (search for similar items in EconPapers)
JEL-codes: F31 G10 G20 G32 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:bdd:journl:v:7:y:2013:i:1:p:59-78

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