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Income Velocity of Money (M2): The Case of Turkey, 1986-2000

Author

Listed:
  • Fatih Cin
  • Fikret Dulger

Abstract

The aim of this study is to test the long-run relation among income velocity of money (M2) as dependent variable and real income, interest rate and real exchange rate as independent variables, for Turkey between 1986.1-2000.4. Johansen Co-Integration and Error-Correction Methods are employed and a long-run relation among these variables is determined through the Johansen Co-integration method where the parameters obtained are consistent with theoretical expectations. Error Correction Method, however, reveals a fairly low adjustment speed (0.05) of short-run shock to long-run equilibrium

Suggested Citation

  • Fatih Cin & Fikret Dulger, 2002. "Income Velocity of Money (M2): The Case of Turkey, 1986-2000," Istanbul Stock Exchange Review, Research and Business Development Department, Borsa Istanbul, vol. 6(22), pages 33-48.
    • Handle: RePEc:bor:iserev:v:6:y:2002:i:22:p:33-48
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    References listed on IDEAS

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