The effects of post-1980 crises on turkey's foreign trade: An econometric application

Turkish economy has been directed toward engaging with global markets and, to ensure this goal, international expansion policies have been adopted since 1980s. Globalization has negative consequences as well as the positive ones, one of whichis that instabilities of the global financial markets swiftly spread to local markets. Turkey?s economy, too, got its share from the negative side of the globalization after opening up to the global economy. Global stagnation, particularly in 2001 and 2007, had a negative impact on Turkey to the extend that the economic crises of 2001 and 2008-2009 in Turkey was reflection of the fluctuations in the global markets. Turkish economy experienced currency devaluations during the economic crises of 1980, 1994 and 2001, and the stagnation in the international markets seriously affected Turkish foreign trade and the real sector as well during 2008-2009 crisis.This thesis examines the phenomenon of economic crisis and its causes, the post-1980 crises that occurred in Turkey and the effects of the crises on foreign trade.In addition, whether foreign exchange rates impact on foreign trade was questioned using VAR model in the thesis. This analysis showed that there does not exist a strong relation between exchange rates and foreign trade while there is a correlation between export and import.