The effectiveness of exchange rate channel in Azerbaijan: An empirical analysis

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Mukhtarov S., YÜKSEL S., Ibadov E., Hamidov H.

Banks and Bank Systems, cilt.14, sa.1, ss.111-121, 2019 (Scopus) identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 14 Sayı: 1
  • Basım Tarihi: 2019
  • Doi Numarası: 10.21511/bbs.14(1).2019.10
  • Dergi Adı: Banks and Bank Systems
  • Derginin Tarandığı İndeksler: Scopus
  • Sayfa Sayıları: ss.111-121
  • Anahtar Kelimeler: Azerbaijani economy, Exchange rate channel, Monetary transmission mechanism, VAR
  • İstanbul Medipol Üniversitesi Adresli: Evet

Özet

The main purpose of this study is to make an analysis to understand whether the exchange rate channel is effective in Azerbaijan. In this framework, quarterly data between 2001:01 and 2017:02 is examined in this study. Furthermore, VAR method is taken into the consideration in the analysis process. The findings show that exchange rate channel is very important for Azerbaijani economy. In other words, the exchange rate channel is working on the total output and price axis. Hence, it is recommended that necessary actions should be taken by a central bank regarding the effective usage of exchange rate channel to contribute to industrial production and employment.