EXCHANGE RATE, EXPORT AND UNEMPLOYMENT RELATION: THE CASE OF TURKEY

Abstract

The changes in the exchange rate are influential in foreign trade in the first stage in terms of open economies. Alterations in export and import as well as changes in the exchange rate can also cause certain effects on unemployment. In the study, firstly the effects of exchange rate on exports and unemployment are mentioned in theoretical and political terms. In the later stages, Toda-Yamamoto causality analysis with tests the validity of these effects in terms of Turkey. As a result of the causality test, bidirectional relationship between real effective exchange rate and exports and bidirectional relationship between exports and unemployment rate were determined.