An Investigation on the Shuttle Trade Dynamics of a Small-Open-Economy
AbstractIn this article we have tried to assess the possible relationships between shuttle trade and the expletory variables, export (f.o.b.), import (c.i.f.) and CPI based real effective US dollar exchange rate. We employed monthly data of Turkey covering the years from 1996:01 to 2006:12 and forecasted the parameters by Ordinary Least Square (OLS) estimation method. In order to find out whether there is a linear relationship among these series; we have checked each series whether are integrated at the same order or not. According to the ADF unit root test results, we have found that all the variables are integrated of order one, I(1), but shuttle trade. Besides we detected a case of multicollinearity among some of the expletory variables. Therefore we used first order autoregression model of shuttle trade. We have derived that, previous month’s shuttle trade have positive impacts on the current level shuttle trade. We also used the same specification to indicate that the shuttle trade value increases in the months of fall and decreases in months of summer
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Bibliographic InfoArticle provided by Technological Educational Institute (TEI) of Kavala, Greece in its journal International Journal of Economic Sciences and Applied Research (IJESAR).
Volume (Year): 1 (2008)
Issue (Month): 2 (December)
International Macroeconomics; Shuttle Trade; Ordinary Least Square;
Find related papers by JEL classification:
- F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
- E26 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Informal Economy; Underground Economy
- C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models
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