INTEREST RATES, FISHER EFFECT AND ECONOMIC DEVELOPMENT IN TURKEY, 1989-2011

Selahattin Guris, Burak Güriş () and Turgut Un

Revista Galega de Economía, 2016, vol. 25, issue 2, 95-100

Abstract: This paper investigates the validity of the Fisher Hypothesis in Turkey covering the period 2003 – 2012. To test validity of Fisher Hypothesis, this paper uses an Autoregressive Distributed Lag test for threshold cointegration recently introduced in the literature by Li and Lee (2010). The empirical results which are obtained from this paper indicate that Fisher hypothesis is valid for Turkey, meaning nominal interest rates would be an important leading indicator for inflation.

Keywords: ADL threshold cointegration test; Fisher hypothesis. (search for similar items in EconPapers)
JEL-codes: C32 E43 (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:sdo:regaec:v:25:y:2016:i:2_8

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