The Fragility of Turkish Economy from the Perspective of Oil Dependency

Eren Yildiz and Merve Karacaer Ulusoy
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Eren Yildiz: Yildirim Beyazit University, Turkey
Merve Karacaer Ulusoy: Yildirim Beyazit University, Turkey

Managing Global Transitions, 2015, vol. 13, issue 3 (Fall), 253-266

Abstract: In an emerging economy, energy is a crucial input. Turkey as an oil dependent country, the volatility of oil price might affect more than thought. In this study, the impact of oil price changes in Turkish macroeconomy has been examined. A VAR model is built by using quarterly data from the first quarter of 2003 to the first quarter of 2013. Variables used in the model are Brent oil price, gross fixed capital formation, interest rate, us GDP and inflation. We believe that the analysis has demonstrated the fragility of Turkish economy to oil price volatility with its significant results in the relationship between oil price and main macroeconomic indicators. This study also shows the incredible need of sustainable energy policies to make a country’s economy stable.

Keywords: oil price shocks; oil dependency; Turkey; macroeconomy; vector auto regressive model; gross fixed capital formation; inflation; interest rate (search for similar items in EconPapers)
JEL-codes: N75 O13 P48 Q13 Q47 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (2)

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