Gorunmez Ama Hissedilmez Degil: Turkiye'de Cikti Acigi

Fethi Ogunc () and Cagri Sarikaya ()

Central Bank Review, 2011, vol. 11, issue 2, 15-28

Abstract: In this study, an output gap measure is derived for the Turkish economy using an estimated New Keynesian model. Considering the ongoing structural transformation during the last decade, the model is estimated for 2002-2010 period using Bayesian techniques. The results indicate that output, which reached a trough in the first quarter of 2009 due to the global crisis, has not returned back to its potential level as of the third quarter of 2010. Below-potential level of output for two subsequent years after the crisis has not only provided striking evidence on the depth of the crisis, but also emerged as a major factor exerting downward pressure on inflation during this period. On the other hand, the results point out that the identification of domestic and external drivers of aggregate demand has a critical role for an effective demand management in monetary policy focusing on price stability.

Keywords: Output gap; Bayesian estimation; unobserved components model; New Keynesian model (search for similar items in EconPapers)
JEL-codes: C11 C51 E31 E32 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:tcb:cebare:v:11:y:2011:i:2:p:15-28

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