Abstract:

In this study, it is aimed to check the factors that affecting Turkish foreign trade and specifically the effects of real exchange rate volatility were examined. For this purpose, time series analysis were run and data covers the years between 1980 and 2010. The variables of real exchange rate, GDP, foreign income and political rights were taken as explanatory variables of the study. Export and import were taken as dependent variable. All series used in the models are stationary in the first difference and co-integration tests and error correction models were used to check long run and short run relationships between variables. It was reached statistically significant and theoretically expected coefficients except from real exchange rates. As a consequence, it was observed that there is no significant effect of exchange rate volatility on Turkish foreign trade and Turkish trade structure are becoming re-exporter

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