KARAGÖZ, Kadir Celal Bayar Üniversitesi - İktisadi ve İdari Bilimler Fakültesi - Ekonometri Bölümü, Turkey , DENİZ, Naim Üsküdar Üniversitesi - Sağlık Bilimleri Fakültesi - Sağlık Kurumları İşletmeciliği Bölümü, Turkey

SHORT AND LONG RUN EFFICIENCY OF DEVALUATIONS: AN EMPIRICAL ANALYSIS FOR TURKEY

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In this paper it is aimed to answer the question of whether nominal devaluation leads to real devaluation via examining the short and long run relationship between nominal and real exchange rate. To this end long run relationship is investigated by using ARDL co-integration test method where short run relationship is investigated by ECM. Results of the analysis reveal that in the 1995-2004 period, nominal and real exchange rates are correlated but expected positive interaction is valid only in short run in Turkey. Thus, positive impact of devaluation operation on current deficit is fugitive and in the long run this effect dies away.

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Nominal , real devaluation , Turkey , ARDL , ECM

Celal Bayar University Journal Of Social Sciences

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