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Denomination composition of trade and trade balance: evidence from Turkey

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  • Hakan Berument
  • Nergiz Dincer

Abstract

The currency denominations of a country's exports and imports are not necessarily the same. If this is the case, then a change in the exchange rate parity among major currencies will affect the trade balance. The empirical evidence provided from Turkey - where exports are mostly denominated in Euros and imports are mostly denominated in USD - suggests that an appreciation of the Euro against the USD would increase the output in the long-run, appreciate the local currency and improve the trade balance for the 1985:01 2003:07 period.

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Applied Economics.

Volume (Year): 37 (2005)
Issue (Month): 10 ()
Pages: 1177-1191

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Handle: RePEc:taf:applec:v:37:y:2005:i:10:p:1177-1191

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Cited by:
  1. H. Bayram Irhan & Nur Dilbaz Alacahan & Levent Korap, 2011. "An Empirical Model for the Turkish Trade Balance: New Evidence from ARDL Bounds Testing Analyses," Istanbul University Econometrics and Statistics e-Journal, Department of Econometrics, Faculty of Economics, Istanbul University, vol. 14(1), pages 38-61, May.
  2. Mohsen Bahmani-Oskooee & Hanafiah Harvey, 2006. "How sensitive are Malaysia's bilateral trade flows to depreciation?," Applied Economics, Taylor & Francis Journals, vol. 38(11), pages 1279-1286.

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