Abstract:

In the study, using quarterly data for the period 2002-2022 in Turkey, the relations between agricultural product imports, oil prices, exchange rates and food and non-alcoholic beverage prices are examined. Granger causality analysis, Johansen cointegration and error correction models are used in the analysis of the relationships between the variables. According to the findings of the study, there is a two-way Granger causality relationship between agricultural goods imports and food and non-alcoholic beverage prices, and a one-way Granger causality relationship between oil prices and food and non-alcoholic beverage prices. According to Johansen cointegration analysis, agricultural goods imports (-4,039) have a positive effect on food and non-alcoholic beverage prices in the long run. There is no statistically significant relationship between oil prices, real exchange rates, and food and non-alcoholic beverage prices. According to the EMC analysis, the model error decreases by -0.387 units in each quarter. The increase in oil prices increases food and non-alcoholic beverage prices in the short run (0.783). There is no statistically significant relationship between real exchange rate and agricultural product imports and food and non-alcoholic beverage prices in the short run. In the light of the stated findings, there is a need to increase the domestic production of these goods in order to prevent the increase in food prices in the long term in Turkey. Although the import of food goods prevents the increase in domestic food prices, the increase in imports brings about a foreign trade deficit. For this reason, it can be recommended to increase domestic agricultural production in particular. On the other hand, reducing the dependence of food and non-alcoholic beverage production on oil and the development of electrical production systems may prevent price increases.

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