An empirical investigation on determinants of foreign trade in Turkey

In this study the results obtained from the previous theoretical and practical studies were examined and the factors that determine foreign trade were analyzed. For this purpose, considering the annual data belongs to 1994-2016 period unit root test, Co-integration test, short-term VAR analysis and Granger Causality analysis were performed in order to determine the relationship and the direction of impact between foreign trade balance and determinants of foreign trade. As a result of the econometric analysis we obtained parallel results with the previous literature. While positive relationship has been found between foreign trade balance and foreign direct investments, foreign income and reel exchange rate, negative relationship has been found between domestic consumption and reel interest rate.