DETECTING ASYMMETRIC IMPACT OF EXCHANGE RATE ON INTERNATIONAL TRADE IN SERVICES: EVIDENCE FROM TÜRKİYE

While agricultural production constituted the basis of economies all over the world until the last centuries, industrial production has reached an important share with the Industrial Revolution. However, the rapid growth of the service sector in the last century has increased the share of the service sector in international trade. The relationship between international trade in goods and exchange rates has been the subject of many studies, and a certain empirical consensus has emerged on this issue. This study investigates whether imports and exports in the services sector have an asymmetric relationship with exchange rate fluctuations in the case of Turkish economy. The findings indicate that the appreciation of the domestic currency has a positive effect on services exports, while it has no significant effect on imports. Moreover, the estimations reveal that the Marshall-Lerner condition is not fully fulfilled for the services sector in Türkiye, and the J curve phenomenon is not valid.