Effects of Currency War on Turkish Economy

Currency war is one of the most feared international economic developments not only for developed countries but also for developing countries. Because in the modern integrated world all of these countries are related through various channels specially through international trade. The aim of this paper is to study currency wars on the basis of related theoretical framework and to find the effect of currency wars on developing countries. To achieve this objective, the effect of dollar-euro parity on real effective exchange rate and real GDP of Turkish economy after the financial crises has been analyzed.