ECONOMETRIC ANALYSIS OF THE RELATIONSHIP BETWEEN BUDGET DEFICIT, MONETARY GROWTH AND INFLATION IN TURKEY- 1992–2006

Halil Altintas, Hakan Cetintas and Sami Taban ()
Additional contact information
Sami Taban: Kahramanmaras University

Anadolu University Journal of Social Sciences, 2008, vol. 8, issue 2, pages 185-208

Abstract: Empirical investigations examining the relationship between budget deficits, monetary growth and inflation have not reached a consensus on the possible relationship between deficits, monetary growth and the rate of inflation. But the major outcome from the empirical studies indicated strong evidence that a budget deficit financed through monetisation and a rising money supply could lead to inflation. The inflationaryeffect of budget deficits depends on the means by which the deficit is financed and the impact of that on aggregate demand. In this study, budget deficits, monetary growth and inflation relationships are investigated by utilizing the ARDLbounds testing approach for Turkey over the period 1992:1-2006:12. While empirical results show that there is a statistically positive relationship between monetary growth and inflation in both long and short run, no connection found between inflation and budget deficit in the both runs.

Keywords: Budget Deficit; Monetary Growth and Inflation; Bound Test; Turkish Economy. (search for similar items in EconPapers)
JEL-codes: E31 C01 E62 (search for similar items in EconPapers)
Date: 2008

Downloads: (external link)
http://www.anadolu.edu.tr/arastirma/hakemli_dergil ... 008-2/2008_02_10.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:and:journl:v:8:y:2008:i:8:p:185-208

Access Statistics for this article

Anadolu University Journal of Social Sciences is edited by Ramazan Geylan

More articles in Anadolu University Journal of Social Sciences from Anadolu University
Contact information at EDIRC.
Series data maintained by Social Sciences Institute (). This e-mail address is bad, please contact .