Browsing by Subject "Inflation"

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1980 Darbesi sonrası kalkınma planları
(Bilkent University, 2023) Özvurmaz, Ahmet Eren; Öztürk, Arda; Öziş, Bilge İdil; Tüten, Efe Ertan; Şener, Ağra Emir
Bu makalede 1980 ve sonrasında sosyal, ekonomik ve kültürel açıdan Türkiye’nin Batı Bloğu ülkelerinden etkilenmeye başlamasıyla birlikte benimsemeye başladığı Liberal Ekonomik Modeli’nin itici güç olduğu Devlet Planlama Teşkilatı’ndaki değişimler, bu teşkilatın öne sürdüğü ve planlamasını üstlendiği IV, V, VI ve VII. Kalkınma Planları, bu planların birbirleriyle olan ilişkilerinin kronolojik açıdan incelenip yorumlanması ve bu planların amaçları ve sonuçları incelenmiştir. DPT ve bu kurumun öne çıkan çalışmaları; dönemin Türkiye’sinin siyasi, ekonomik, sosyokültürel durumu göz önüne alınarak analiz edilmiştir.
Open Access
3+1 Essays on the Turkish economy
(2005) Yücel, Mustafa Eray
This dissertation comprise of four essays. The first essay studies the relationship between treasury auction maturity and auction interest rates. Using the Turkish auction data from 1988 to 2004, a reciprocal linkage between auction interest rates and maturities is observed, especially for the 1995-2000 period. This suggests that under an adverse shock, treasury decreases the auction maturity in order not to increase interest rates too much. A change in this reciprocal relationship is also reported for the post-2001 era. The second essay assesses the effect of USD-Euro parity on a small open economy for an economy where its exports are predominantly denominated in Euros and imports are denominated in USD. The empirical evidence suggests that a positive innovation in USD-Euro parity appreciates the local currency, decreases inflation and increases output. The third essay studies the relationship between on-budget and off-budget expenditures in Turkey and concludes that information content of the budget deficit statistics is not empty; however, it might be misleading in assessing fiscal stance for Turkey. The final essay investigates the connection between Turkish industrial production performance and the success of a popular Turkish football team, namely Fenerbahce. The success of Fenerbahce is interpreted as a proxy for the workers' mood or morale. Performing a transfer function analysis on my monthly data set, I reveal a positive feedback from Fenerbahce's success, which proxies workers' mood/morale, to economic performance. Evidence of the effects of games against domestic rivals on industrial performance is not statistically significant.
Open Access
Application of periodogram-based cointegration test for the analysis of the services and goods sector inflations
(Econometric Research Association, 2010) Metin Ozcan, K.; Akdi, Y.; Kalafatcilar, K.
The differing dynamics of the inflations of the services and goods sectors has been of major concern in Turkey. The persistence of the services sector inflation during disinflation periods hampered the efforts of the Central Bank of Turkey of hitting inflation targets in a country with long-lasting high inflation experience. In search of a possible long-run relationship between the services and goods sectors’ inflations, this paper employs a method based on periodograms of the series in addition to time series tools. A periodogram-based test has pros over conventional tests; this test is model-free, seasonally robust and mean invariant. Empirical findings obtained from the methods employed in this study, Engle-Granger’s and Johansen’s conventional long-run time series tools as well as periodogram based test, suggest that services and goods sector inflations in Turkey are not cointegrated.
Open Access
Asymmetric behavior of exchange rate pass through in Turkey
(2009) Şen, Bahar
This thesis investigates the presence of asymmetry in pass through from exchange rates to manufacturing industry prices in Turkey. In the analysis, to detect a possible nonlinear response of prices, threshold regression models are employed. The results indicate that reactions of prices to exchange rate movements differ depending on the aggregate demand conditions. In particular, when the economy is booming, exchange rate changes are transmitted into prices in a larger extent. On the other hand, during slowdowns, fluctuations of exchange rates are not reflected on prices and past inflation has more important role in determining prices.
Open Access
Asymmetric effects of monetary policy shocks on economic performance: empirical evidence from Turkey
(Routledge, 2016) Ülke, V.; Berument, Hakan
This study investigates the asymmetric effects of monetary policy shocks on the macroeconomic variables of exchange rate, output and inflation for an emerging economy ‒ Turkey ‒ by using monthly data between 1990 and 2014. We employ the innovative nonlinear vector autoregressive model of Kilian and Vigfusson (2011), which allows us to observe the effect of different stances (tight or loose) and different sizes (small or large) of monetary policy actions. Our empirical evidence reveals that tight monetary policy, which, in this case, is captured with a positive shock to interest rate, decreases exchange rate, output and prices, as economic theory suggests. Loose monetary policy, which is captured with a negative shock to interest rate, has the opposite effect on these variables. However, the effects of loose monetary policy are weaker than the effects of tight monetary policy because loose monetary policy shocks are less effective than tight monetary policy shocks. Moreover, as the magnitude of a shock increases, the difference between the effects of tight and loose monetary policy policies also increases. © 2015 Taylor & Francis.
Open Access
Central bank independence and economic performance in eastern Europe
(Elsevier BV, 2001) Neyapti, B.
Following the breakdown of central planning by the early 1990s, transition economies faced varying measures of the need for economic restructuring and stabilisation. This paper examines both the trends in economic performance in eight eastern European countries and the degree of central bank independence (CBI) granted after reforms. The evidence of the paper indicates that both the measures of CBI and the measures of financial market development (FMD) show significant association with macroeconomic variables. Also, the sample exhibits positive association between CBI and measures of FMD. © 2001 Elsevier Science B.V. All rights reserved.
Open Access
Central bank independence, financial market development and inflation
(2008) Küsmen, Gamze
Central bank independence (CBI) and inflation relation has long been a debate and is established in many studies, such as Bade and Parkin (1982), Alesina (1988, 1989), Grilli, Masciandaro, and Tabellini (1991), and Cukierman, Webb and Neyaptı (1992). Although these studies address the negative relation between CBI and inflation, they do not consider the effect of the development level of financial markets on this relation. Posen (1995) considers the effect of financial market development by using effective financial opposition to inflation formed by the inflation-averse groups. He tests the effect of this variable on CBI and inflation simultaneously. He claims that the variable, which decreases inflation is effective financial opposition to inflation (when used with CBI) rather than CBI. Thus, he states that rather than analyzing the direct relation between inflation and CBI, the effect of effective financial opposition to inflation on CBI and inflation should be investigated. Based on this study, this thesis looks at the effect of financial market development (FMD) both on CBI and on the relation between CBI and inflation by using alternative indicators for FMD. We find that there is a significant and positive relation between CBI and FMD for non-transition countries. Moreover, although Posen (1995) states that CBI does not have a significant effect on inflation when EFOI is included as an additional explanatory variable, we find evidence that both FMD and CBI have a significant effect on inflation. However, the results of the estimations are not robust to changes in samples.
Open Access
Central bank reform, liberalization and inflation in transition economies-an international perspective
(Elsevier BV, 2002) Cukierman, A.; Miller, G. P.; Neyapti, B.
This paper develops extensive new indices of legal independence (central bank indepedence (CBI) for new central banks (CBs) in 26 former socialist economies. The indices reveal that CB reform in the FSE during the 1990s has been quite ambitious. In spite of large price shocks, reformers in those countries chose to create CBs with levels of legal independence that are substantially higher, on average, than those of developed economies during the 1980s. The evidence in the paper shows that CBI is unrelated to inflation during the early stages of liberalization. But for sufficiently high and sustained levels of liberalization, and controlling for other variables, legal CBI and inflation are significantly and negatively related. These findings are consistent with the view that even high CBI cannot contain the initial powerful inflationary impact of price decontrols. But once the process of liberalization has gathered sufficient momentum legal independence becomes effective in reducing inflation. The paper also presents evidence on factors that affect the choice of CBI and examines the relation between inflation and CBI in a broader sample. © 2002 Elsevier Science B.V. All rights reserved.
Open Access
Comparison of the forecast performances of linear time series and artificial neural network models within the context of Turkish inflation
(2001) Uçar, Nuri
This thesis compares a variety of linear and nonlinear models to find the one with the best inflation forecast performance for the Turkish Economy. These comparisons are performed by considering the type of series whether or not stationary. Different combination techniques are applied to improve the forecasts. It is observed that the combination forecasts based on nonstationary vector autoregressive (VAR) and artificial neural network (ANN) models are better than the ones generated by other models. Furthermore, the forecast values combined with ANN technique produce lower root mean square errors (RMSE) than the other combination techniques.
Open Access
Depository banks were trapped high inflation into cost inefficiency: The Turkish experience
(2010) Demir, N.; Mahmud, S. F.; Babuscu, S.
Turkey embraced its worst banking crisis in the year 2001 after a long history of high inflation. Only one-third of the private domestic banks could survive immediately before and then after the crisis, mainly because of cost inefficiencies. We argue that many bank managers were trapped into cost inefficiencies during the high inflation years because they over-expanded with many new branches, looking for additional costly scarce funds in order to invest in government's securities for exuberant profits. Based on a stochastic total cost frontier with inefficiency effects (CIE) model, bank samples provide strong evidence that investing more in government securities during high inflation periods is highly significant in explaning cost inefficiency differentials among banks, in contrast to low inflation periods. A policy implication is that when inflation subsides rapidly, banks which invest heavily in government securities under high inflation are confronted with financial deterioration since they cannot adjust their cost structure, e.g., by closing several of their branches, in line with revenue losses. © EuroJournals Publishing, Inc. 2010.
Open Access
Determinants of workers' remittances: Turkish evidence from high-frequency data
(Routledge, 2006) Alper, A. M.; Neyapti, B.
The potential importance of workers remittances (WR) as a relatively stable source of foreign exchange has been growing across the world. We present time-series evidence on the determinants of WR in a large developing country, Turkey. Using yearly data, Aydas et al. (2005) show that WR flows to Turkey are significantly influenced by the growth rate of the home gross domestic product (GDP); the level of GDP in both home and host countries; interest rate differentials between home and host countries; the black market exchange rate; inflation; and political stability. This study utilizes higher-frequency data to further investigate the issue from both long-term and short-term perspectives. The new evidence supports the earlier findings regarding the long-run investment motive, but it also shows that consumption smoothing is an effective short-run motive for sending remittances to Turkey. © 2006 M.E. Sharpe, Inc. All rights reserved.
Open Access
The dynamics of a newly floating exchange rate: the Turkish case
(Routledge, 2006) Ardıç, O. P.; Selçuk, F.
In recent years, many emerging market economies have switched or are in the process of switching to a floating exchange rate regime. Most of these economies have a history of high inflation and a high level of foreign currency denominated debt. Therefore, the stability of the exchange rate and the dynamics of its volatility are more crucial than before. This paper analyses the dynamics of exchange rate in Turkey in the aftermath of recent float in February 2001. The Turkish experience is a particularly important one, and provides valuable lessons for other countries as the Central Bank is trying to simultaneously contain the volatility of exchange rate and pursue an implicit inflation targeting policy. The reported findings indicate that the Central Bank policies, accompanied with favourable external factors, were effective in taming the volatility of the exchange rate in a relatively short period of time. However, there is a significant real appreciation of the currency during the same period. Given the high level of public debt and real interest rates, the current state of the economy is very susceptible to any adverse shocks. © 2006 Taylor & Francis.
Open Access
Dynamics of post-pandemic inflation in Türkiye
(2024-08) İpek, Mahmut Sefa
In the post-pandemic period, Turkish inflation increased to levels last seen in the 1990s. Both the average level and dynamics of inflation in Türkiye were different from inflation in other Emerging European countries. This study employs a six-variable Bayesian vector autoregression (BVAR) model with stochastic volatility to estimate the historical decomposition of inflation in Türkiye during the post-pandemic period. The findings suggest that this period can be divided into two distinct episodes: from November 2021 to May 2023, inflation was driven by both domestic and global factors, with domestic ones being more dominant. From June 2023 onwards, inflation accelerated entirely by domestic factors.
Open Access
The effect of foreign income on economic performance of a small-open economy: evidence from Turkey
(Routledge, 2004) Berument, Hakan; Kilinc, Z.
The effect of a shock in the foreign economic performance on the domestic economy is an attractive research area. It has consistently been found that this effect is non-negligible. However, the countries examined are mostly developed countries. In this study, the effects of a shock in foreign economy on the economic performance of Turkey are examined. The estimates suggest that a positive shock in the foreign economy positively affects Turkish output, increases the inflation rate, and appreciates the real exchange rate. © 2004 Taylor and Francis Ltd.
Open Access
The effect of inflation uncertainty on inflation: stochastic volatility in mean model within a dynamic framework
(Elsevier BV, 2009) Berument, Hakan; Yalcin, Y.; Yildirim J.
This paper investigates the effect of inflation uncertainty innovations on inflation over time by considering the monthly United States data for the time period 1976-2006. In order to investigate the effect of inflation uncertainty innovation on inflation, a Stochastic Volatility in Mean model (SVM) has been employed. SVM models are generally used to capture the innovation to inflation uncertainty, which cannot be achieved in the framework of popular deterministic ARCH type of models. Empirical evidence provided here suggests that innovations in inflation volatility increases inflation persistently. This evidence is robust across various definitions of inflation and different sub-periods. © 2009 Elsevier B.V. All rights reserved.
Open Access
The effects of aid on inflation : the role of financial market development
(2005) Dönmez, Ayça
This thesis investigates the relationship between foreign aid and inflation considering the effect of financial market development (FMD) on this relationship. The main hypothesis is that aid has a significant positive impact on inflation. When the financial markets are developed enough, the upward effect of aid on inflation is expected to be diminished. The dynamic relationship is analyzed utilizing generalized method of moments (GMM) estimation which accommodates the use of an unbalanced panel data set, covering 60 countries in the period 1975-2004, where available. The results of the empirical analysis support the hypothesis. Furthermore, the results are robust to several control variables, and alternative measures of financial market development.
Open Access
The effects of electricity price changes on prices of other goods and services – evidence from Turkey
(Routledge, 2020) Gedikkaya, A.; Varlık, S.; Berument, Hakan
This article employs a Factor-Augmented Vector Autoregressive model to assess the effects of electricity price innovations on prices of other goods and services. Using monthly series from Turkish Domestic Producer Price Index (D-PPI) and Harmonized Index of Consumer Prices (HICP) components, the results from the analyses on D-PPI components suggest that (i) Machinery & Equipment (not elsewhere classified); Electrical Equipment; and Rubber & Plastic Products increase the most, while (ii) Tobacco Products; Crude Petroleum & Natural Gas; and Water Supply, Sewerage, Waste Management & Remediation Services increase the least. In addition, the results from the analyses on HICP components suggest that (iii) Housing, Water, Electricity, Gas & Other Fuels; Furnishings, Household Equipment & Maintenance; and Restaurants & Hotels increase the most, while (iv) Communications; Alcoholic Beverages, Tobacco & Narcotics; and Education increase the least.
Open Access
The effects of Japanese economic performance on Indonesia
(Routledge, 2006) Berument, Hakan; Ceylan, N. B.; Vural, B.
This paper assesses how Japanese economic performance affects the Indonesian economy for the 1988 to 2004 period. The empirical evidence provided here suggests that Japanese growth appreciates the local currency in real terms, decreases the inflation and increases growth. As a side issue, we also documented that real exchange rate depreciation accelerates inflation and decreases growth in Indonesia. © 2006 Taylor & Francis.
Open Access
Effects of soccer on stock markets: the return-volatility relationship
(Pergamon Press, 2012) Berument, Hakan; Ceylan, N. B.
This paper assesses the effects of domestic soccer teams' performances against foreign rivals on stock market returns as well as on the return-volatility relationship. Data from Chile, Spain, Turkey and the United Kingdom support propositions that soccer teams results in international cups affect stock market returns and the return-volatility relationship. Evidence from Spain and the UK, soccer powerhouses, suggests that losses are associated with lower returns and higher risk aversion but evidence from Chile and Turkey, where soccer is the most important sport but teams are not as successful, reveals that wins are associated with higher returns and lower risk aversion. Crown Copyright (C) 2012 Published by Elsevier Inc. on behalf of Western Social Science Association. All rights reserved.
Open Access
The effects of social security systems on macroeconomic performance: a cross-sectional analysis
(1999) Erdem, F. Senem
Developments in demographic factors affect the magnitude of several Social Security attributes, and have recently lead many countries to reform their systems. The most marked one of such reforms is the transition from Pay-as-you-go (PAYG) based systems to funded systems. This thesis discusses the effects of social security systems on a country’s macroeconomic performance by means of a cross-sectional study. It examines five main macroeconomic indicators: GDP growth rate, budget deficit, private saving rate, unemployment and inflation. It does so by using both their main macroeconomic determinants and the relevant social security attributes, such as dependency ratio, social security deficit, retirement ages, contribution rates, and public spending on social security. Our main conclusion is that many social security attributes significantly affect macroeconomic indicators.