The Nature Of Impulse Mechanısm: An Empırıcal Study For Turkey

Tevfik Hakan Ongan and Dündar Murat Demiröz

MPRA Paper from University Library of Munich, Germany

Abstract: The fundamental purpose of this paper is to identify the nature of impulse mechanism, from which random shocks to general price and income levels are generated. In recent business cycle literature, it is generally accepted that business cycles are triggered by random productivity and technology shocks. However, this approach can not explain the current degree of volatility of business cycle fluctuations. Especially, New Keynesian economists emphasized the influence of demand shocks under the assumption of nominal and real rigidities and some other market imperfections. Therefore, it is convenient to identify whether the shocks to the general prices and national income are on demand or supply side. It is shown in the paper that between the first quarter of 1987 and the fourth quarter of 2003 in Turkey, shocks to national income are mostly composed of shocks to demand factors. On the other hand, the shocks to cost factors influence the shocks to general price level more frequently than shocks to demand factors.

Keywords: fluctuations; business cycle; macro economics; supply demand shocks (search for similar items in EconPapers)
JEL-codes: E31 E32 (search for similar items in EconPapers)
Date: 2004
References: Add references at CitEc
Citations:

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/1403/1/MPRA_paper_1403.pdf original version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:1403

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter (winter@lmu.de).