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Exchange Rate Volatility and Employment Growth in Developing Countries: Evidence from Turkey

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  • Demir, Firat

Abstract

Summary Employing a unique panel of 691 private firms that accounted for 26% of total value added in manufacturing in Turkey, the paper explores the impacts of exchange rate volatility on employment growth during the period of 1983-2005. The empirical analysis using a variety of specifications, estimation techniques, and robustness tests suggests that exchange rate volatility has a statistically and economically significant employment growth reducing effect on manufacturing firms. Using point estimates, the results suggest that for an average firm a one standard deviation increase in real exchange rate volatility reduces employment growth in the range of 1.4-2.1 percentage points.

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Bibliographic Info

Article provided by Elsevier in its journal World Development.

Volume (Year): 38 (2010)
Issue (Month): 8 (August)
Pages: 1127-1140

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Handle: RePEc:eee:wdevel:v:38:y:2010:i:8:p:1127-1140

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Keywords: exchange rate volatility employment growth manufacturing firms South Eastern Europe Turkey;

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Cited by:
  1. Caglayan, Mustafa & Demir, Firat, 2014. "Firm Productivity, Exchange Rate Movements, Sources of Finance, and Export Orientation," World Development, Elsevier, vol. 54(C), pages 204-219.
  2. Dhasmana, Anubha, 2013. "Real Effective Exchange Rate and Manufacturing Sector Performance: Evidence from Indian firms," MPRA Paper 47479, University Library of Munich, Germany.
  3. Lo Turco, Alessia & Maggioni, Daniela, 2013. "Does Trade Foster Employment Growth in Emerging Markets? Evidence from Turkey," World Development, Elsevier, vol. 52(C), pages 1-18.

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