Recently, due to the price instability in Turkey's economy began to affect the real economy, it has become essential for the policy-makers to defect the factors causing instability in the price and produce appropriate policies. For this purpose, in the study, using the quarterly data for the period 2006:Q1-2018:Q2; determinants of inflation in Turkey is being investigated by the ARDL Bounds Test. In this study, consumer price index is used as explained variable, while money supply, Dollar/TL exchange rate, exchange rate volatility, interest rate applied to loans and deposits, GDP and budget deficit variable are used as explanatory variables. The results obtained from the ARDL Boundary Test reveal the existence of a long-term relationship between the variables. In addition, in the long term, it is concluded that the interest rate applied to money supply, budget deficit and general purpose loans is positively related to inflation; in the short run, it was concluded that the money supply and budget deficit (balance) variables were positively related to inflation. It was determined that the exchange rate volatility included in the study as a criterion of uncertainty triggered inflation in the short and long term, but this effect was statistically insignificant.
Recently, due to the price instability in Turkey’s economy began to affect the real economy, it has become essential for the policy makers to defect the factors causing instability in the price and produce appropriate policies. For this purpose, in the study, using the quarterly data for the period 2006:Q1-2018:Q2; determinants of inflation in Turkey is being investigated by the ARDL Bounds Test. In this study, the consumer price index is used as explained variable, while money supply, Dollar/TL exchange rate, exchange rate volatility, interest rate applied to loans and deposits, GDP and budget deficit variable are used as explanatory variables. The results obtained from the ARDL Boundary Test reveal the existence of a long-term relationship between the variables. In addition, in the long term, it is concluded that the interest rate applied to money supply, budget deficit and general purpose loans is positively related to inflation; in the short run, it was concluded that the money supply and budget deficit (balance) variables were positively related to inflation. It was determined that the exchange rate volatility included in the study as a criterion of uncertainty triggered inflation in the short and long term, but this effect was statistically insignificant.
Alan : Sosyal, Beşeri ve İdari Bilimler
Dergi Türü : Uluslararası
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