The Macroeconomic Determinants of Turkey’s Export Performance: An Econometric Analysis Through the Lens of Classical Trade Theories

Exports play a pivotal role in the economic development of nations, making the factors that influence this trade essential to understand. This study examines the macroeconomic determinants of Turkey’s export performance during the pre-COVID-19 period, from 2003 to 2019, a time marked by political stability and consistent economic policies under the ruling government. Using the Engle-Granger Cointegration method, the study investigates the long-term and short-term impacts of key macroeconomic variables-Gross Domestic Product (GDP), exchange rates, imports, and interest rates-on Turkey’s export performance. The results show that while GDP and interest rates positively influence exports in the long run, imports exhibit a consistent positive effect on exports in both the short and long term. Moreover, exchange rates have a negative long-term impact on exports, indicating the challenges posed by currency fluctuations. These findings underscore Turkey's import dependency and reflect the broader macroeconomic environment shaped by policies during pre-COVID-19. The study provides valuable insights into the macroeconomic dynamics affecting export performance and offers implications for future economic strategies.