Motivation CaseINTRODUCTION:The roots of the foreign trade reach to the past. Trade activities taken place between countries shaped the future of the foreign trade policies. As it gained importance, foreign trade policies started to shape the economies more effectively. By the help of the theories developed by the economists, international economics as a new branch in the economy started to play crucial roles for the countriesâ economic activities. Today, the importance of the boundaries has decreased as a result of the globalization of the markets and this case strengthens the significance of the foreign trade. For this reason, I wanted to evaluate the one subject matter related to international economics for my econometrics project. Moreover, my interest in macroeconomics and trade policies influenced me as well while selecting this topic.
The Problem
Some time after my econometrics project, I wrote about the topic of globalization of the markets. It is important to understand that no single economic policy has its place in this topic.
The Economic Theory
Now imagine that you have a data collection collection company. One has a collection of 3 data sets, 1 and 2 of which have been collected from the country where its business is located.
If we want to apply this to the problem of globalization, let us say that the country with the highest concentration of foreign investments are all located in Asia, where there are no more than 2.5 million foreigners living in the country.
That country is also one with the highest population density in China, the country with a relatively high exchange rate for the foreign exchange of the foreign exchange currency, which was in 2011.
For that reason its population is much bigger than that of the other.
To put this problem further, let us apply the same problem as above, but with a single foreign policy for example, an inter-governmental organization (IISO). This would be in charge of the planning and enforcement of the local, regional and national laws.
In other words the data collection company can’t help deciding whether or not this country’s citizens are truly in such economic interest at all.
This would make sense as, for example, the world’s largest single employer, the US. The country’s citizens spend more in business expenditures than anyone in the world alone.
The Solution
However, the point I made is, after a long discussion, it just seems to be that we can’t take advantage of all available opportunities in the world. And it seems to have reached us that the problem with the foreign trade problems is that most countries are too big to do much for one person when they need another for their business.
For example, when Japan goes to the US, instead of doing all it has to does to address foreign policy issues, it just goes abroad. This kind of growth has been impossible for us because the nation has not acquired such assets well and cannot cope with that.
Even when the country is well established and well-run, many other countries and regions will be unable to grow that way. We have to do something to ensure we have some sort of global opportunity.
In this regard, I think that the solution for the problem of globalization of the markets should be to have a more flexible strategy.
This might appear to be a somewhat simplistic solution.
But in reality, one’s role should be to decide on how to allocate each of these resources within the global economy. In other words, we should choose to look at various issues from outside the country and evaluate their impact in foreign policy setting.
The Problem
Some time after my econometrics project, I wrote about the topic of globalization of the markets. It is important to understand that no single economic policy has its place in this topic.
The Economic Theory
Now imagine that you have a data collection collection company. One has a collection of 3 data sets, 1 and 2 of which have been collected from the country where its business is located.
If we want to apply this to the problem of globalization, let us say that the country with the highest concentration of foreign investments are all located in Asia, where there are no more than 2.5 million foreigners living in the country.
That country is also one with the highest population density in China, the country with a relatively high exchange rate for the foreign exchange of the foreign exchange currency, which was in 2011.
For that reason its population is much bigger than that of the other.
To put this problem further, let us apply the same problem as above, but with a single foreign policy for example, an inter-governmental organization (IISO). This would be in charge of the planning and enforcement of the local, regional and national laws.
In other words the data collection company can’t help deciding whether or not this country’s citizens are truly in such economic interest at all.
This would make sense as, for example, the world’s largest single employer, the US. The country’s citizens spend more in business expenditures than anyone in the world alone.
The Solution
However, the point I made is, after a long discussion, it just seems to be that we can’t take advantage of all available opportunities in the world. And it seems to have reached us that the problem with the foreign trade problems is that most countries are too big to do much for one person when they need another for their business.
For example, when Japan goes to the US, instead of doing all it has to does to address foreign policy issues, it just goes abroad. This kind of growth has been impossible for us because the nation has not acquired such assets well and cannot cope with that.
Even when the country is well established and well-run, many other countries and regions will be unable to grow that way. We have to do something to ensure we have some sort of global opportunity.
In this regard, I think that the solution for the problem of globalization of the markets should be to have a more flexible strategy.
This might appear to be a somewhat simplistic solution.
But in reality, one’s role should be to decide on how to allocate each of these resources within the global economy. In other words, we should choose to look at various issues from outside the country and evaluate their impact in foreign policy setting.
In this project, I will proceed on the import function that is directly related with the international economics. I will regress import on the national income and inflation rate. I will examine Turkeyâs case covering the years between 1987- 2004.
LITERATURE VIEW:During my research, I utilized many articles but I will use four of them. Firstly, I read the article written by Ricardo Faini, Land Pritchett, and Fernando Clavijo. The articleâs name is âImport Demand in Developing Countriesâ. They focus on the impact of import controls and the effect of tariffs and the aggregation problem. In their article, they rely on 3 different approaches.
First, a traditional import demand function relating real imports (M) to real income (Y) and the ratio of import prices (Pm) to domestic prices (PD) is estimated for 50 countries:
where V1(t) is an error term with the standard properties.The second approach (Pritchett 1988; Moran 1988) aims at providing a simple way to recover the structural demand parameters. It relies on the specification of an import supply equation as well as on a standard demand equation:
where M denotes imports, F and R denote real foreign exchange receipts and reserve levels respectively, and Pm and Pm denote the domestic and the border prices of imports, respectively.
They explain the third approach by saying that the direct incorporation of quantitative restrictions is the main method of recovering structural demand parameters and assessing the impact of removing import restrictions; however, that approach also suffers from many shortcomings. For example, a good indicator of quantitative restrictions is not usually available, and even if this indicator exists, interpreting its behavior may