Testing Quantity Theory of Money for the Turkish Economy

Özgür Aslan and Levent Korap ()

Journal of BRSA Banking and Financial Markets, 2007, vol. 1, issue 2, 93-109

Abstract: In this paper, it is tried to test the main assumptions of the Quantity Theory of Money for the Turkish economy. Using some contemporaneous estimation techniques to examine the long-run stationary economic relationships on which the quantity theory is constructed, it is found that stationary characteristics of the velocitities of narrowly and broadly defined monetary aggregates cannot be rejected. However, monetary aggregates seem to be endogenous for the long-run evoluation of prices and real income. It is concluded that monetary authorities follow an accommodative monetary policy inside the period given the endogeneity of the monetary variables.

Keywords: Quantity Theory of Money; Neutrality; Co-integration; Turkish Economy. (search for similar items in EconPapers)
JEL-codes: C32 E41 E52 E61 (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (3)

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Working Paper: Testing quantity theory of money for the Turkish economy (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:bdd:journl:v:1:y:2007:i:2:p:93-109

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