Inflation, Output Growth, and Stabilization in Turkey, 1980-2002

Selahattin Dibooglu and Aykut Kibritçioğlu

Macroeconomics from University Library of Munich, Germany

Abstract: Using a dynamic aggregate supply and aggregate demand model with imperfect capital mobility and structural VARs, we decompose inflation and output movements into those attributable to terms of trade, supply, balance-of-payments, fiscal, and monetary shocks. Empirical results show that terms of trade shocks have a significant negative effect on inflation in the short run. In the long run, monetary, and balance of payments shocks dominate while budget deficits play a limited role in the inflationary process. Demand shocks have limited effects on output movements; output is mostly driven by terms of trade and supply shocks. The results highlight the importance of a credible disinflation program and structural reform that restrain discretionary aggregate demand policies.

Keywords: Causes and effects of inflation; inflation theories; stabilization policy; theory of aggregate supply and aggregate demand; time series models; Turkish economy (search for similar items in EconPapers)
JEL-codes: C32 E23 E31 F41 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2003-06-04
Note: Type of Document - Acrobat Reader/PDF; prepared on PC; to print on any printer; pages: 33 ; figures: included
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://econwpa.ub.uni-muenchen.de/econ-wp/mac/papers/0306/0306001.pdf (application/pdf)

Related works:
Journal Article: Inflation, output growth, and stabilization in Turkey, 1980-2002 (2004)
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:wpa:wuwpma:0306001

Access Statistics for this paper

More papers in Macroeconomics from University Library of Munich, Germany
Bibliographic data for series maintained by EconWPA ( this e-mail address is bad, please contact ).