Finance – Growth Nexus: Evidence from Turkey
11 Pages Posted: 9 May 2009
Date Written: 2007
Abstract
This paper examines the causal relationship between financial development and economic growth in Turkey for the period 1986:1-2006:4 using dynamic time series models. The results of the cointegration analysis provide evidence of no long-run relationship between financial development and economic growth. Therefore, the empirical investigation is carried out in a vector autoregression (VAR) framework to analyze the short run effect of the financial intermediary development on economic growth. The results show a one-way causal relationship running from the financial development to the economic growth in Turkey.
Keywords: Financial development, Growth, Turkey, Causality.
JEL Classification: O11, O16, O52.
Suggested Citation: Suggested Citation
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