Abstract
We estimate the demand for new automobiles in Turkey immediately following its entry to Custom Union with the European Union in 1996. We use quarterly data on price, quantity, quality, country of origin and product characteristics of the new automobile sales market and macroeconomic variables to estimate market demand during 1996–1999 using dynamic Generalized Least Squares Estimation method. In addition to including quality, we also include country of origin, to serve as another proxy for quality and to capture differences in cost-increasing and demand-reducing trade restrictions imposed on cars from certain countries as well as taste differences. Our results indicate that country of origin as well as quality matter for automobile demand in Turkey. Consistent with other aggregate automobile demand models for other countries, the demand for new automobiles is found to be price inelastic in the short run.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
