Determinants of food price in Turkey: A Structural VAR approach

Abstract The rise in food prices in Turkey in the post-Covid 19 period is extremely higher than the increase in the consumer price index and the social dimension of food price. This issue prompted researchers and policy makers to examine these topics. The fact that negativities which have been observed worldwide in an emerging process are making a difference also reinforces the need for more intensive investigation of food prices or policies to be followed. This trend aims to identify the global and macroeconomic factors that cause the rise in food prices in the Turkish economy. According to this purpose, In order to measure the global impact, oil prices, the global fertilizer price index, and the world food price index were included in the study. The M2 exchange rate and money supply variables were used to measure the macroeconomic impact. In this context, monthly data for the period 2003:01–2022:03 were used in the analysis using the SVAR model. Result of the analysis indicated that global and macroeconomic factors had an impact on food prices in the period under consideration. As a result of the variance decomposition, it was observed that the food price after its own collisions was more reactive with the exchange rate, respectively.