Assessing the Value of the (New) Turkish Lira

5 Pages Posted: 4 Jan 2017

See all articles by Engin Kucukkaya

Engin Kucukkaya

METU Department of Business Administration

Ugur Soytas

DTU Management

Ramazan Sari

Middle East Technical University (METU)

Date Written: June 30, 2007

Abstract

Observing that the Turkish Lira has appreciated against the US Dollar in the recent years in spite of the higher inflation rate in Turkey brings a question about the applicability of PPP to Turkish case. We provide Turkish Balance of Payments, an indicator of funds flow, as an explanatory factor for the changes in the YTL/USD exchange rate. Both models used, with Balance of Payments and without, reveals that PPP does not hold between Turkey and the US for the time period examined.

Keywords: PPP, Exchange Rate

JEL Classification: F31

Suggested Citation

Kucukkaya, Engin and Soytas, Ugur and Sari, Ramazan, Assessing the Value of the (New) Turkish Lira (June 30, 2007). Available at SSRN: https://ssrn.com/abstract=2892517 or http://dx.doi.org/10.2139/ssrn.2892517

Engin Kucukkaya (Contact Author)

METU Department of Business Administration ( email )

United States

HOME PAGE: http://www.ba.metu.edu.tr

Ugur Soytas

DTU Management ( email )

Produktionstorvet 424
Room 020
Kgs. Lyngby, 2800
Denmark

Ramazan Sari

Middle East Technical University (METU)

Ankara, 06531
Turkey

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