The relationship between defense spending and inflation : an emprical analysis for Turkey
Author(s)
Advisor
Akdeniz, LeventDate
2004Publisher
Bilkent University
Language
English
Type
ThesisItem Usage Stats
213
views
views
130
downloads
downloads
Abstract
This study estimates the relationship between defense expenditures and inflation
in Turkey over the period of 1950-2001 by employing a Johansen Cointegration
analysis and Granger Causality test. The different views that appear in the
literature on this relationship are identified and it is concluded that there is no
agreement as to the exact nature of the relationship between defense spending
and inflation. The results of this study indicate that defense expenditures and
inflation have a significant effect on each other both in the long and in the short
run. In other words, there is Granger feedback (X↔Y) between defense
spending and inflation for Turkey.
Keywords
Defense expendituresDirect Granger Causality
Johansen Cointegration
money growth
budget deficit
inflation