Daraltici Devalüasyon Hipotezi: Türkiye Üzerine Bir Uygulama
Nazif Catik ()
No 609, Working Papers from Ege University, Department of Economics
(This paper is in Turkish) In this paper we have empirically investigated the validity of the contractionary devaluation hypothesis in Turkey by using the Structural VAR methodology developed by Bernanke (1986). The model used in this study shows that, contrary to conventional wisdom, real depreciations have contractionary effects on output. Persistent devaluations have led to high inflation and economic contraction in Turkey. For that reason we have reached the conclusion that foreign trade policy based on the persistent devaluation of real exchange rate will not be efficient to increase export potential of Turkey. Evidences obtained from variance decompositions and impulse response functions imply that there is a very strong pass-through from real exchange rate to inflation. This finding also point out the substantial risks to keep the exchange rate at a competitive level. As a result permanent real devaluation may not be successful unless it is accompanied by appropriate monetary and fiscal policies.
Keywords: Contractionary Devaluation; Growth; Stuctural VAR; Daraltici Devalüasyon; Büyüme; Yapisal VAR (search for similar items in EconPapers)
JEL-codes: F41 F31 (search for similar items in EconPapers)
Pages: 19 pages
New Economics Papers: this item is included in nep-cwa and nep-mac
References: Add references at CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
http://iibf.ege.edu.tr/economics/papers/wp06-09.pdf First version, 2006 (application/pdf)
Journal Article: Daraltıcı Devalüasyon Hipotezi: Türkiye Üzerine Bir Uygulama (2007)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:ege:wpaper:0609
Access Statistics for this paper
More papers in Working Papers from Ege University, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Baris Gök ().