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Determinants of Currency Crises in Emerging Markets: The Case of Turkey

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  • Ãzge ÃeÅmeci
  • A. Ãzlem Ãnder

Abstract

This paper investigates possible determinants of currency crises in Turkey. We use three different techniquesânamely, the signaling approach, structural model, and Markov switching model with monthly data for the period 1992-2004. The results show that money market pressure index, real-sector confidence index, and public-sector variables are significant in explaining currency crises. Hence, one can say that banking crises lead to currency crises. Central banks' real-sector confidence index may be a good leading indicator for currency crises.

Suggested Citation

  • Ãzge ÃeÅmeci & A. Ãzlem Ãnder, 2008. "Determinants of Currency Crises in Emerging Markets: The Case of Turkey," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 44(5), pages 54-67, September.
  • Handle: RePEc:mes:emfitr:v:44:y:2008:i:5:p:54-67
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    References listed on IDEAS

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    Cited by:

    1. repec:mes:emfitr:v:52:y:2016:i:1:p:123-135 is not listed on IDEAS
    2. Ari, Ali, 2012. "Early warning systems for currency crises: The Turkish case," Economic Systems, Elsevier, vol. 36(3), pages 391-410.
    3. Ali Ari & Raif Cergibozan, 2016. "The Twin Crises: Determinants of Banking and Currency Crises in the Turkish Economy," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 52(1), pages 123-135, January.
    4. Tristan Nguyen & Nguyen Ngoc Duy, 2017. "Developing an Early Warning System for Financial Crises in Vietnam," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 7(4), pages 413-430, April.
    5. Gokhan Karabulut & Mehmet Huseyin Bilgin & Ayse Celikel Danisoglu, 2010. "Determinants of Currency Crises in Turkey," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 46(0), pages 51-58, May.
    6. A. Nazif Çatik & A. Özlem Önder, 2011. "Inflationary Effects of Oil Prices in Turkey: A Regime-Switching Approach," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 47(5), pages 125-140, September.
    7. Gokhan Karabulut & Mehmet Huseyin Bilgin & Ayse Celikel Danisoglu, 2010. "Determinants of Currency Crises in Turkey," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., vol. 46(0), pages 51-58, May.
    8. A. Nazif Çatik & A. Özlem Önder, 2011. "Inflationary Effects of Oil Prices in Turkey: A Regime-Switching Approach," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., vol. 47(5), pages 125-140, September.

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