The Real Effective Exchange Rate and Industrial Employment: The Turkish Case

Akkay, Reşat Can

doi:10.20409/berj.2021.334

Cited by 1 publication

(1 citation statement)

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“…According to Fiec (2019) in the European Construction Industry Federation report, the CS in EU provides more than 18 million jobs as direct opportunities and represents 9% of the total GDP of the EU countries. The Turkish CS shares a total employment rate of 5.52% and contributes 6% to the total GDP (Akkay, 2021). Further, the sector has a positive effect on the level of social and environmental development, especially on the availability of infrastructure that can improve the quality of life in the country (Alaloul et al, 2021).…”

Section: Introductionmentioning

confidence: 99%

Nexus between construction sector and economic indicators for Turkey and European Union evidenced by panel data analysis

Qabaja

Tenekeci

2022

ECAM

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PurposeThe research aims to study the regression, cointegration and causality between the construction sector (CS) and the Gross Domestic Product (GDP), considering other variables in the study such as interest rate, taxation, industry sector, investment and Foreign Direct Investment (FDI), which are analyzed through unique panel models. The study was conducted in Turkey and the ten other countries of the European Union (EU) from 1988 to 2019.Design/methodology/approachRegression, cointegration and causality methods were used to investigate the different types of relationships between variables in the models. Data were obtained from official databases and the study contains four main stages, which are explained in detail in the methodology section.FindingsThe study used the analysis methods of regression, cointegration and causality tests and found that the CS and GDP have long-run estimates and the relationship between the two for different countries is negative in a two-way direction. Results are detailed in the analysis section.Research limitations/implicationsNo data were available for the variables before 1988 for most countries, which led to a limited number of observations and issues in statistical analysis methods.Originality/valuePreviously, only input and output tables were used in the analysis. The impact of interest rate, taxation, investment and FDI has not been analyzed. Key variables are very relevant for Turkey, which suffers from chronical inflation and taxation regimes. These show variability with the EU countries for comparative analysis and have not been explored to date, remaining as a major gap for the construction industry. No attempts were made to use regression, cointegration and causality methods with variables. These analysis methods enable an understanding of the differences in variance (heteroscedasticity) and the presence of cross-sectional dependence (CSD), both critical for the reliability of the comparison of data sets and analysis.

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Section: Introductionmentioning

confidence: 99%