| Summary: | Business cycles are constantly observed,
whether small or large, due to delays in response of supply to demand in the
maritime market. In some cases, the incomes are so low that it does not give
the shipowners a chance to live, and in some cases they go from rags to riches.
Despite these risks, the maritime market is vital especially for developing
countries such as Turkey. The aim of this study is to determine the factors
that influence the probability of price bubble formation in the İstanbul
Freight Index (ISTFIX). In this direction, firstly the price bubbles were
determined by generalized sup augmented Dickey-Fuller (GSADF) test. Following
the GSADF test, a logit regression model was established by creating dummy
variables from bubble dates and it was tried to determine the factors affecting
bubble formation. The dataset consists of 354 weekly observations and covers the
dates between 18.03.2011 and 31.12.2017. According to the results, 4 bubble
periods with lengths ranging from 6 to 12 weeks were detected. In the logit
model, it was found that “euro” and “fuel price” variables increase the
probability of bubble formation and the marginal effect of “euro” is much
higher.
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