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Journals / Çankırı Karatekin Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi / 2020 / Cilt: 10 - Sayı: 1

Unemployment, Exchange Rate and Exchange Rate Volatility Relation: Analysis for Turkey

Gülsüm AKARSU
Pages
179–209
Publication Date
2020-06-30
DOI
—
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AI Summary & Key Takeaways

AI Insight
⚡ TL;DR(Too Long; Didn't Read)

Results show that although exchange rate fluctuations do not affect the unemployment, exchange rate volatility significantly increases unemployment.

📌 3 Key Takeaways

🎯
Objective & Hypothesis:Öz By the previous studies, exchange rate fluctuations have been considered to be an important factor affecting the real sector of economies as economies have become more open.
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Key Findings & Data:Most of the studies focused on its trade impact, however, through different channels, exchange rate movements can also influence the unemployment.
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Conclusion & Impact:Results show that although exchange rate fluctuations do not affect the unemployment, exchange rate volatility significantly increases unemployment.
🔬Design:Research Article
📍Scope:2005 Verileri
⚙️Variables:Anahtar Kelimeler Unemployment · Exchange rate · Exchange rate volatility

Özet

Öz By the previous studies, exchange rate fluctuations have been considered to be an important factor affecting the real sector of economies as economies have become more open. Most of the studies focused on its trade impact, however, through different channels, exchange rate movements can also influence the unemployment. This study aims to analyze the effect of exchange rate and its volatility on unemployment for Turkey over the period from 2005 to 2019 by using quarterly data. As a solution for possible endogeneity problem, VAR analysis was performed. Results show that although exchange rate fluctuations do not affect the unemployment, exchange rate volatility significantly increases unemployment. Moreover, positive output shocks contribute statistically significantly to the reduction of unemployment in line with Okun’s Law. In conclusion, different policy measures should be employed to reduce the exchange rate volatility or its effect on unemployment or both.

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Cite This Article

AKARSU, G. (2020). Unemployment, Exchange Rate and Exchange Rate Volatility Relation: Analysis for Turkey. Çankırı Karatekin Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, Cilt: 10 - Sayı: 1, 179–209. https://ajindex.com/articles/154724

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