Abstract

This article attempts to analyze the effect of trade integration on the asymmetric behavior of export prices with respect to exchange rate changes using the experience of Turkey’s trade integration and that of the European Union in 1996. In the course of this study, a fairly low exchange rate pass-through elasticity was found and the presence of asymmetry in the industries was considered. It was also found that neither the exchange rate pass-through elasticity nor the asymmetric response of export prices to appreciations and depreciations changed due to the trade integration.  

Key words: Pass-through, trade integration, Turkey.