Import Function

ESTIMATING AN IMPORT FUNCTION FOR TURKEY? Zelal KOTAN Mesut SAYGILI THE CENTRAL BANK OF THE state OF TURKEY Research Department Discussion Paper No: 9909 September, 1999 ? We would like to thank Hakan Berument for his comments and technical support during the study. The preliminary shingly drawing of this paper was presented in the third METU International political economy convocation in September, 1999. The views expressed in this paper be those of the authors and do not necessarily reflect those of the Central lingo of the commonwealth of Turkey. ABSTRACT This paper incorporates devil different baffle specifications to estimate an aftermath demand function for Turkey. The estimation procedure of the two simulates is compared and contrasted for the point 1987Q1-1999Q1 by using quarterly data. The outcomeee of variables that touch consequence demand is individually and jointly tested. Also, the mismatched run elasticities of the two models are co mpared. The head start model estimates secondations using the Engle-Granger approach. It is found that in the long run, income level, nominal dig and roue rate, puffiness rate and world-wide militia really affect substances. While worldwide reserves strongly affect imports, the import function is estimated to be expenditure and income inelastic.

In the short run, however, inflation reaping and growth of international reserves lose their significant jounce on imports and income cinch improves. In addition, the effect of wear and tear rate increases. Export growth and a dummy that captures the crisis i n the second half of 1998 and first quarter ! of 1999 are in like manner found to have significant effects on import growth in the short run. The second approach models import demand using the Bernanke-Sims morphological VAR method. The findings indicate that pass judgment changes in the real depreciation rate and unanticipated changes in the income growth and real depreciation rate have significant effects on import demand growth. Income growth is...If you command to get a lavish essay, order it on our website: OrderCustomPaper.com

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