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The effect of real exchange rates and their volatilities on the selected agricultural commodity exports: A case study on Turkey, 1971-2010

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  • Halit YANIKKAYA

    (Gebze Institute of Technology, Gebze-Kocaeli, Turkey)

  • Huseyin KAYA

    (Bahcesehir University, Istanbul, Turkey)

  • Osman Murat KOCTURK

    (Celal Bayar University, Manisa, Turkey)

Abstract

This study investigates the effect of the exchange rate volatility and the real exchange rate on the bilateral agricultural exports flows of Turkey to 46 countries. A panel data set, which contains 46 cross-sections and 1840 observations, is used for exports of the selected agricultural commodities to countries from 1971 to 2010. Our empirical results based on a gravity equation show that while the exchange rate volatility does not exert a significant effect on the Turkish agricultural commodity exports, the real exchange rate has a statistically significant effect on the agricultural commodity export flows. Regardless of the region chosen, raisins and tobacco exports are very much sensitive to the real exchange rates. It means that any depreciation in the Turkish Lira leads to higher exports for these commodities. We have also some interesting results on other commodities. Exports of dried figs show no sensitivity to the exchange rate or its volatilities, except for the EU countries. For the full sample, exports of citrus, grape and hazelnuts increases as the TL depreciates. The sensitivity of hazelnut to the real exchange rates varies among regions.

Suggested Citation

  • Halit YANIKKAYA & Huseyin KAYA & Osman Murat KOCTURK, 2013. "The effect of real exchange rates and their volatilities on the selected agricultural commodity exports: A case study on Turkey, 1971-2010," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 59(5), pages 235-246.
    • Handle: RePEc:caa:jnlage:v:59:y:2013:i:5:id:122-2012-agricecon
    DOI: 10.17221/122/2012-AGRICECON
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    2. Harun Uçak & Yakup Ari & Esin Yelgen, 2022. "The volatility connectedness among fertilisers and agricultural crop prices: Evidence from selected main agricultural products," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 68(9), pages 348-360.
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