Factors Affecting Current Account Balance of Turkey: A Survey With the Cointegrating Regression Analysis

Özdamar, Gökhan

doi:10.17261/pressacademia.2015414533

Cited by 14 publications

(4 citation statements)

References 46 publications

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“…As a result, a 1% increase in net foreign asset, real effective exchange rate, terms of trade and real GDP tends to bring a 0.13, 0.16, 0.19 and 0.18 percentage points decline in CAD, respectively. These results are consistent with the results found by most of the studies in the existing empirical literature including Gumatta (2014) in South Africa, Tehseen and Raza (2012) in Pakistan, Chinn and Prasad (2003) in selected industrial and developing countries, Ozdamar (2015) in Turkey, Calderon et al (2002) for selected developing countries, Oshota and Badejo (2015) in West Africa, Calderon et al, Gebreegziabher (2003) in Ethiopia, Gehringer (2013) in case of European Union and Aristovnik (2007) in MENA countries. Moreover, inflation appeared to be insignificant meaning it has no meaningful influence to determine the movement of current account in the country.…”

Section: Estimation Of Long Run Ardl Modelsupporting

confidence: 92%

IFRS, Accounting Standards in Various States

2020

RJFA

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The main objective of this study is to empirically investigate the determinants of current account deficits in Ethiopia using annual time series data ranging from 1975 to 2016. To investigate the long run and short run relationship between current account deficit and its determinants, Autoregressive Distributed Lag (ARDL) model or bounds testing approach to co-integration and Error Correction Model (ECM) are applied respectively. The results of the Augmented Dickey Fuller (ADF) test indicate that the variables under consideration are a mixture of integrated of order zero and order one, that is, I(0) and I(1). Moreover, the result of bounds testing confirms the existence of stable long run relationship between current account balance and its determinants. The empirical result reveals that net foreign asset, real effective exchange rate, terms of trade and real GDP are found to have a negative impact on current account deficit, while government budget balance positively affected current account deficit in the long run. However, inflation is found to be insignificant both in the short run and in the long run. The ECM also shows that, real effective exchange rate, terms of trade and inflation have no significant effect on current account deficit in the short run. As a policy implication, it is recommended that employing appropriate policy mix along with devaluation, diversification and improving the quality of exports and implementation of efficient tax administration system are among the policy options that are supposed to alleviate the existing current account deficit.

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Section: Estimation Of Long Run Ardl Modelsupporting

confidence: 92%

IFRS, Accounting Standards in Various States

2020

RJFA

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“…To address this fundamental issue, some authors involve two-regime threshold cointegration (Hansen & Seo, 2002), unit roots and fractional integration (Cunado, Gil-Alana & de Gracia, 2010), and Granger causality, Johansen cointegration, ARDL (autoregressive distributed lag) bound tests, and the simultaneous equation system (Behera & Yadav, 2019), whereas others use different approaches, such as nonlinear models to capture structural breaks (Chen, 2011), regime change or threshold (Afonso, Huart, Jalles & Stanek, 2019), and vector autoregression (Jin, Wang & Zhao, 2021). Cointegrating regression analysis is also employed to solve those econometric obstacles (Ozdamar, 2015) but with divergent results.…”

Section: Research Methods and Datamentioning

confidence: 99%

Current account imbalances and exchange rate volatility: Empirical evidence from Indonesia

Kuncoro¹,

Fafurida²

2023

Ekon horizonti

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Whether macroeconomic fundamentals affect the exchange rate volatility in emerging markets with an inflation-targeting regime or not is highly challenging. In this paper, the impact of the current account deficits and foreign reserves on the volatility of real exchange rates. Applying threshold quantile regression models related to Indonesia over the period from 2005(7) to 2021(12), it is concluded that both variables play an important role in controlling the exchange rate instability. Both coefficients are also found to have an upward linear pattern. The asymmetric impact of current account balance holds. Claiming that a two-percent current account deficit in the GDP is the safe amount of the deficit that will not significantly affect the foreign-exchange rate is justified as such. The asymmetric behavior of the current account balance has the potential to trigger real exchange rate volatility, thereby undermining the monetary policy within the framework of the inflation targeting regime. Accordingly, the optimal stock of foreign reserves might avoid imposing dual goals of inflation targeting and exchange rate stability.

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“…Adapun temuan empiris (Henry dan Longmore, 2003) yang menunjukkan nilai tukar riil tidak berkontribusi dalam menentukan elemen-elemen utama dari neraca berjalan Jamaika. Sebuah studi yang dilakukan oleh (Ozdamar, 2015) menemukan bahwa nilai tukar riil mempengaruhi saldo akun Turki secara tidak signifikan. Hasil empiris lainnya oleh (Walter et al, 2012) menunjukkan bahwa baik dalam jangka pendek dan jangka panjang, impor dan ekspor AS sangat sensitif terhadap perubahan dalam pendapatan AS dan asing, sedangkan impor dan ekspor AS relatif tidak sensitif terhadap perubahan nilai tukar bilateral.…”

Section: Kajian Teoriunclassified

Studi Empiris Government Effectiveness dan Trade Openness terhadap Perdagangan Internasional

Pertiwi¹,

Herianingrum²,

Mustofa

et al. 2020

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This study aims to examine the impact of macroeconomic factors such as Inflation, Exchange Rates, Total Labor Force, Technology, Worldwide Government and Trade Openness on International Trade in 10 Islamic countries as the main actors of international trade Intra-OKI from 2005 to 2018. Quantitative research This applies the Panel Data Regression method to the Fixed Effect Model. Research analysis techniques use the EViews 10. software program. Empirical results show that inflation and total labor force, government effectiveness and trade openness have a significant positive effect to Intra-OKI international trade. This means that the better the quality of worldwide government and trade openness in a country will increase the country's international trade activities. In addition, exchange rates and technology do not have a significant effect in Intra-OKI international trade.

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Factors Affecting Current Account Balance of Turkey: A Survey With the Cointegrating Regression Analysis

Cited by 14 publications

References 46 publications

IFRS, Accounting Standards in Various States

IFRS, Accounting Standards in Various States

Current account imbalances and exchange rate volatility: Empirical evidence from Indonesia

Studi Empiris Government Effectiveness dan Trade Openness terhadap Perdagangan Internasional

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