Abstract:

In this study, the impact of credit to the private sector in Turkey (CREDIT) on economic growth is investigated using internal and external macroeconomic determiners of economic growth. In the study 1998: Q1 - 2020: the short and long-term effects of the credit provided to the private sector (CREDIT), gross fixed capital formation (GFCF), general government final consumption spending (GFCE), real effective exchange rate (REER), interest rate (INTR), capital income (CAPFLOWS), total factor efficiency (TFP) and the global economic policy uncertainty index (GEPU) on economic growth are analyzed by the ARDL method. The results of the study show that the impact of changes in domestic and foreign variables on economic growth is significantly consistent with the expected signs. According to empirical findings, long-term CREDIT and GFCF variables have been shown to have positive, GFCE, LREER, CAPFLOWS, TFP variables have a negative impact on growth. In the short term, the effects of the variables are variable and the effects of the variables are variable.

Abstract:

In this study, the effect of credits to the private sector to the economic growth in Turkey is investigated by using internal and external macroeconomic determinants of economic growth. The study utilizes the variables of credits to the private sector (CREDIT), gross fixed capital formation (GFCF), general government final consumption expenditure (GFCE), real effective exchange rate (REER), interest rate (INTR), capital inflows (CAPFLOWS), total factor productivity (TFP) as the domestic macroeconomic variables, and global economic policy uncertainty index (GEPU) as the external factor that affect the economic growth in Turkey. The ARDL approach over the period of 1998:Q1 to 2020:Q1 is applied for the estimations. The study results show that the effects of the changes in domestic and external variables on economic growth are significant with expected signs. The empirical results confirmed that CREDIT and GFCF have a positive effect on growth, whereas GFCE, LREER, CAPFLOWS, and TFP variables have negative effect on growth. In the short term, the effects of the current and lagged values of the variables differ.

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