On the asymmetric effects of exchange rate changes on domestic production in Turkey

Mohsen Bahmani-Oskooee, Ferda Halicioglu and Amirhossein Mohammadian ()

Economic Change and Restructuring, 2018, vol. 51, issue 2, No 1, 97-112

Abstract: Abstract A few studies in the literature have used linear models to assess the impact of changes in the value of lira on Turkish domestic production. They have found no significant long-run effects. In this paper we separate lira appreciations from depreciations and engage in asymmetry analysis. Since the procedure requires using nonlinear models, we rely upon Shin et al.’s (Festschrift in honor of Peter Schmidt: econometric methods and applications. Springer, New York, pp 281–314, 2014) nonlinear ARDL approach and discover that indeed, the effects of changes in the real effective value of lira have asymmetric effects, both in the short run as well as in the long run. Indeed, in the long run we find that both lira depreciation and lira appreciation to have expansionary effects on domestic production in Turkey.

Keywords: Asymmetry; Nonlinear ARDL; Domestic production; Exchange rate; Turkey (search for similar items in EconPapers)
JEL-codes: F31 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22)

Downloads: (external link)
http://link.springer.com/10.1007/s10644-017-9201-x Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:ecopln:v:51:y:2018:i:2:d:10.1007_s10644-017-9201-x

Ordering information: This journal article can be ordered from
http://www.springer. ... nt/journal/10644/PS2

DOI: 10.1007/s10644-017-9201-x

Access Statistics for this article

Economic Change and Restructuring is currently edited by George Hondroyiannis

More articles in Economic Change and Restructuring from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().