IDEAS home Printed from https://ideas.repec.org/a/gam/jjrfmx/v15y2022i4p184-d794991.html
   My bibliography  Save this article

Asymmetric Exchange Rate Pass-Through in Turkish Imports of Cocoa Beans

Author

Listed:
  • Nazif Durmaz

    (College of Business, University of Houston-Victoria, Katy, TX 77449, USA)

  • John Kagochi

    (College of Business, University of Houston-Victoria, Victoria, TX 77901, USA)

Abstract

The present paper uses asymmetric cointegration and error-correction modeling where a nonlinear adjustment of the exchange rate yields results that are different than those yielded by linear models. We study cocoa imports for Turkey with advanced ARDL and nonlinear ARDL frameworks. Our findings reveal that there is considerable asymmetry for the case of Turkish cocoa bean imports from Côte d’Ivoire. Compared with imports from Ghana, there are significant differences in Turkish importers’ preferences when choosing between the two cocoa bean providers. Our results provide support for the nonlinear adjustment of the real Turkish lira–US dollar exchange rate and a hint of imperfect rivalry in Turkish cocoa bean imports.

Suggested Citation

  • Nazif Durmaz & John Kagochi, 2022. "Asymmetric Exchange Rate Pass-Through in Turkish Imports of Cocoa Beans," JRFM, MDPI, vol. 15(4), pages 1-11, April.
    • Handle: RePEc:gam:jjrfmx:v:15:y:2022:i:4:p:184-:d:794991
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1911-8074/15/4/184/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1911-8074/15/4/184/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Mohsen Bahmani-Oskooee & Hadise Fariditavana, 2016. "Nonlinear ARDL Approach and the J-Curve Phenomenon," Open Economies Review, Springer, vol. 27(1), pages 51-70, February.
    2. Alaba David Alori & Adebayo Augustine Kutu, 2019. "Export Function of Cocoa Production, Exchange Rate Volatility and Prices in Nigeria," Journal of Economics and Behavioral Studies, AMH International, vol. 11(2), pages 1-14.
    3. M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
    4. Bismark Addai & Adjei Gyamfi Gyimah & Kwadwo Poku-Agyemang & Evan Lau, 2020. "Exchange rate regimes and global cocoa trade: to float or to peg?," Cogent Economics & Finance, Taylor & Francis Journals, vol. 8(1), pages 1719593-171, January.
    5. Bahmani-Oskooee Mohsen & Harvey Hanafiah, 2017. "The Asymmetric Effects of Exchange Rate Changes on the Trade Balance of Singapore," Global Economy Journal, De Gruyter, vol. 17(4), pages 1-11, December.
    6. Arize, Augustine C. & Malindretos, John & Igwe, Emmanuel U., 2017. "Do exchange rate changes improve the trade balance: An asymmetric nonlinear cointegration approach," International Review of Economics & Finance, Elsevier, vol. 49(C), pages 313-326.
    7. Mohsen Bahmani-Oskooee & Nazif Durmaz, 2016. "Exchange rate volatility and Turkish commodity trade with the rest of the world," Economic Change and Restructuring, Springer, vol. 49(1), pages 1-21, February.
    8. Seyed Komail Tayebi & Mehdi Yazdani, 2014. "Financial crisis, oil shock and trade in Asia," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 41(4), pages 601-614, July.
    9. Bahmani-Oskooee, Mohsen & Aftab, Muhammad, 2017. "On the asymmetric effects of exchange rate volatility on trade flows: New evidence from US-Malaysia trade at the industry level," Economic Modelling, Elsevier, vol. 63(C), pages 86-103.
    10. Koi Nyen Wong & Tuck Cheong Tang, 2008. "The effects of exchange rate variability on Malaysia's disaggregated electrical exports," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 35(2), pages 154-169, May.
    11. Mohsen Bahmani-Oskooee & Hadise Fariditavana, 2015. "Nonlinear ARDL approach, asymmetric effects and the J-curve," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 42(3), pages 519-530, August.
    12. Mohsen Bahmani-Oskooee & Scott W. Hegerty & Dan Xi, 2016. "Third-country exchange rate volatility and Japanese--US trade: evidence from industry-level data," Applied Economics, Taylor & Francis Journals, vol. 48(16), pages 1452-1462, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Selin Güney & Andrés Riquelme & Barry Goodwin, 2023. "An Analysis of the Pass-Through of Exchange Rates in Forest Product Markets," Agriculture, MDPI, vol. 13(3), pages 1-16, February.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bahmani-Oskooee, Mohsen & Baek, Jungho, 2016. "Do exchange rate changes have symmetric or asymmetric effects on the trade balance? Evidence from U.S.–Korea commodity trade," Journal of Asian Economics, Elsevier, vol. 45(C), pages 15-30.
    2. Bahmani-Oskooee, Mohsen & Halicioglu, Ferda & Hegerty, Scott W., 2016. "Mexican bilateral trade and the J-curve: An application of the nonlinear ARDL model," Economic Analysis and Policy, Elsevier, vol. 50(C), pages 23-40.
    3. Mohsen Bahmani-Oskooee & Nazif Durmaz, 2020. "Asymmetric cointegration and the J-curve: evidence from commodity trade between Turkey and EU," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 47(4), pages 757-792, November.
    4. Sajad Ahmad Bhat & Javed Ahmad Bhat, 2021. "Impact of Exchange Rate Changes on the Trade Balance of India: An Asymmetric Nonlinear Cointegration Approach," Foreign Trade Review, , vol. 56(1), pages 71-88, February.
    5. Mohsen Bahmani-Oskooee & Ridha Nouira, 2020. "On the impact of exchange rate volatility on Tunisia’s trade with 16 partners: an asymmetry analysis," Economic Change and Restructuring, Springer, vol. 53(3), pages 357-378, August.
    6. Mohsen Bahmani-Oskooee & Nazif Durmaz, 2021. "Exchange rate volatility and Turkey–EU commodity trade: an asymmetry analysis," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 48(2), pages 429-482, May.
    7. Mohsen Bahmani-Oskooee & Ahmed Usman & Sana Ullah, 2020. "Asymmetric J-curve in the commodity trade between Pakistan and United States: evidence from 41 industries," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 10(2), pages 163-188, June.
    8. Mohsen Bahmani-Oskooee & Augustine C. Arize, 2020. "Asymmetric response of domestic production to exchange rate changes: evidence from Africa," Economic Change and Restructuring, Springer, vol. 53(1), pages 1-24, February.
    9. Bahmani-Oskooee, Mohsen & Kanitpong, Tatchawan, 2019. "Thailand-China commodity trade and exchange rate uncertainty: Asymmetric evidence from 45 industries," The Journal of Economic Asymmetries, Elsevier, vol. 20(C).
    10. Ho Hoang Gia Bao & Hoang Phong Le, 2022. "The Roles of Vehicle Currency and Real Effective Exchange Rates in the Trade of Every ASEAN Member With the EU-28," SAGE Open, , vol. 12(2), pages 21582440221, April.
    11. Khalid M. Kisswani & Arezou Harraf & Amjad M. Kisswani, 2019. "Revisiting the effects of oil prices on exchange rate: asymmetric evidence from the ASEAN-5 countries," Economic Change and Restructuring, Springer, vol. 52(3), pages 279-300, August.
    12. Mohsen Bahmani-Oskooee & Amirhossein Mohammadian, 2019. "Who benefits from euro depreciation in the euro zone?," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 46(3), pages 577-595, August.
    13. Bahmani-Oskooee Mohsen & Harvey Hanafiah, 2017. "The Asymmetric Effects of Exchange Rate Changes on the Trade Balance of Singapore," Global Economy Journal, De Gruyter, vol. 17(4), pages 1-11, December.
    14. Augustine C. Arize & Mohsen Bahmani-Oskooee, 2018. "Do Imports and Exports Adjust Nonlinearly? Evidence from 100 Countries," Global Economy Journal (GEJ), World Scientific Publishing Co. Pte. Ltd., vol. 18(1), pages 1-30.
    15. Mohsen Bahmani-Oskooee & Huseyin Karamelikli, 2021. "Asymmetric J-curve: evidence from UK-German commodity trade," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 48(4), pages 1029-1081, November.
    16. Bilgin, Cevat, 2020. "Asymmetric Effects of Exchange Rate Changes on Exports: A Sectoral Nonlinear Cointegration Analysis for Turkey," MPRA Paper 101316, University Library of Munich, Germany.
    17. Sabrine Ferjani & Sami Saafi & Ridha Nouira & Christophe Rault, 2022. "The Impacts of the Dollar-Renminbi Exchange Rate Misalignment on the China-United States Commodity Trade: An Asymmetric Analysis," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 20(3), pages 507-554, September.
    18. Mohsen Bahmani-Oskooee & Ferda Halicioglu & Sahar Bahmani, 2017. "Do exchange rate changes have symmetric or asymmetric effects on the demand for money in Turkey?," Applied Economics, Taylor & Francis Journals, vol. 49(42), pages 4261-4270, September.
    19. Mohsen Bahmani-Oskooee & Huseyin Karamelikli, 2022. "Exchange Rate Volatility and Commodity Trade between U.K. and China: An Asymmetric Analysis," Chinese Economy, Taylor & Francis Journals, vol. 55(1), pages 41-65, January.
    20. Mohsen Bahmani‐Oskooee & Niloy Bose & Yun Zhang, 2019. "An asymmetric analysis of the J‐curve effect in the commodity trade between China and the US," The World Economy, Wiley Blackwell, vol. 42(10), pages 2854-2899, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jjrfmx:v:15:y:2022:i:4:p:184-:d:794991. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.