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

Journal: Business and Economics Research Journal (BERJ) (Vol.12, No. 3)

Publication Date:

Authors : ;

Page : 491-507

Keywords : Real Effective Exchange Rate; Industrial Employment; ARDL Model; Aggregation Bias; Turkey;

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Abstract

This study investigates the relationship between industrial employment and producer price index-based real effective exchange rate, over the period 2009M01-2019M10, by employing the autoregressive distributed lag cointegration procedure, for the Turkish economy. The empirical findings support the existence of a positive relationship between the appreciation of the producer price index-based real effective exchange rate and an increase in industrial employment. Accordingly, a 1% appreciation of the producer price index-based real effective exchange rate leads to a 0.092% increase in industrial employment. This finding supports the dominance of the “imported input” channel over the other transmission channels for Turkey at the industry level.

Last modified: 2021-08-28 05:51:50