Impact of Unemployment, Wages and Inflation on the Increase of Trade and Growth

ABSTRACT

In this study, annual time series data is utilized to estimate the effects of unemployment, wages and inflation on the enlargement of trade and growth for Turkey between 1985 and 2015. Calculations show that OLS results can be spread and considered for a selected sample period where the results indicate that devaluing the Turkish lira made a limited contribution to Turkish trade. According to the Johansen cointegration test results for CPI and unemployment, the relationship reaches equilibrium in the long run. However, the effect of inflation and unemployment on trade enlargement is not significant and did not contribute to making Turkish producers competitive in international markets.

KEYWORDS:

• Unemployment
• cointegration
• ordinary least square
• inflation
• trade

JEL CLASSIFICATION:

• F: International economics
• F4: macroeconomic aspects of international trade and finance

ORCID

Ergin Akalpler http://orcid.org/0000-0002-9547-7842