Does the Effect of the Real Exchange Rate on Exports of Machinery and Transport Vehicles Change Over Time? Evidence from a Non-linear Panel ARDL Analysis

This study examines the relationship between Türkiye's machinery and transport equipment exports and the real exchange rate using monthly data from January 2013 to August 2023. The long-term relationship was confirmed by the Westerlund (2007) panel cointegration test, and the panel ARDL results were obtained using the CS-ARDL estimator, which accounts for cross-sectional dependence and heterogeneity in slopes. The analysis, including six sub-samples, reveals an asymmetric relationship between exports and the real exchange rate, meaning that depreciation and appreciation of the real exchange rate affect exports with varying significance across time periods. In the early periods of the study, negative shocks to the real exchange rate supported exports. However, after 2020, following the pandemic and global developments, the significance of negative real exchange rate shocks disappeared, while positive shocks began to constrain exports. The study also obtained estimation results at the country level. Overall, the results highlight structural shifts in this relationship over time, suggesting that export policies should be adaptive and targeted based on specific trade partners and periods to account for these asymmetries.