The relation between main economic indicators and foreign trade volume: Turkey sample

Economic growth, exchange rate, employment and foreign trade volume are essential economic indicators for every single country. The results of economic growth, exchange rate and employment indicators for the foreign trade volume composition have formed topics of numerous studies. In this study the contribution of economic indicators in Turkey which are economic growth, exchange rate and unemployment to foreign trade volume has been searched. The first chapter of the study includes economic indicators followed by the second chapter foreign trade volume and foreign trade theory and politics. On the third chapter literature research and on the last chapter empirical analysis have been done. In literature review, the presence and orientation of the relation between GDP (gross domestic product), exchange rate, unemployment and foreign trade in Turkey and in the world was analyzed partially not as a whole. The purpose of this study is to confirm whether there is a causality between foreign trade volume and economic indicators and reveal the direction of the causality relationship if available. The empirical methods used were unit root test and Granger Causality test by means of E-Views programme. The data were acquired from Turkish Statistical Institute and the central bank of the Turkish Republic. The period covers the years 2000-2018. As a result of the analysis from economic growth and exchange rate to foreign trade volume and from economic growth to exchange rate one-way causality relationship was determined.