An Empirical Evaluation of the Relationship between Trade Openness and External Debt: Turkish Case
This paper aims to analyze the empirical relationship between trade openness and external debt for the Turkish economy, using quarterly time series data from the 1990:1-2012:2 periods. We utilize the bounds testing procedure to establish the cointegration relationship among variables and the ARDL analysis to detect short run and log run static effects. We support the results from the ARDL model through the application of GMM estimation, achieved with different model definitions. Empirical results indicate that increasing trade openness affects external debt positively in both the short run and long run.
Volume (Year): 6 (2014)
Issue (Month): 1 (April)
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- Dardana Rruka, 2004. "Decoding the Effects of Trade Volume and Trade Policies on Economic Growth: A Cross-Country Investigation," International Trade 0405003, EconWPA.
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- Emilio Colombo, 2009. "The Politics of External Debt in Developing Countries," Working Papers 176, University of Milano-Bicocca, Department of Economics, revised Dec 2009.
- Jeffrey M. Wooldridge, 2001. "Applications of Generalized Method of Moments Estimation," Journal of Economic Perspectives, American Economic Association, vol. 15(4), pages 87-100, Fall.
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