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The interaction between monetary and fiscal policies in Turkey: An estimated New Keynesian DSGE model

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  • Çebi, Cem

Abstract

This paper estimates a New Keynesian open economy DSGE model for Turkey by using Bayesian estimation technique for the period of 2002:q1–2009:q3. It studies fiscal and monetary policy interactions and their role in stabilisation of the economy using a small-scale model following the methodology outlined in Lubik and Schorfheide (2007). The general features of the model can be summarised as follows: Calvo style nominal price rigidities, perfect exchange rate pass-through, complete international asset markets, rule of thumb price setters and distortionary taxation.

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Bibliographic Info

Article provided by Elsevier in its journal Economic Modelling.

Volume (Year): 29 (2012)
Issue (Month): 4 ()
Pages: 1258-1267

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Handle: RePEc:eee:ecmode:v:29:y:2012:i:4:p:1258-1267

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Web page: http://www.elsevier.com/locate/inca/30411

Related research

Keywords: Monetary and fiscal policies; Macroeconomic stabilisation; Bayesian estimation;

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