Yağmur İ., Akcan A. T.
17th International İstanbul Scientific Research Congress, İstanbul, Türkiye, 28 - 30 Eylül 2025, ss.452-460, (Tam Metin Bildiri)
Özet
- Understanding
the relationship between exchange rate dynamics and international income flows
is crucial for the financial stability of an economy. Net primary and secondary
income, which are components of the balance of payments, can influence exchange
rate movements and are also affected by exchange rate fluctuations. This study
examines the causality relationship between the official exchange rate and net
primary and secondary income using annual data covering the period 1990-2024 in
the Turkish economy. In this context, Fourier ADF and Fourier LM unit root
tests were first applied to the variables in the analysis section of the study,
and then the relationship between the variables was determined using the
Fourier Toda-Yamamoto causality test. According to the causality test results,
a bidirectional and statistically significant causality relationship was found
between the official exchange rate and net secondary income. This finding shows
that changes in the exchange rate affect net secondary income flows, while
changes in net secondary income also have a causal effect on the exchange rate.
On the other hand, no causality relationship was found between the official
exchange rate and net primary income. These results reveal that secondary
income items, such as workers’ remittances, are affected by exchange rate
fluctuations and that these inflows play an active role in determining the
country’s exchange rate equilibrium.