IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v49y2017i18p1737-1750.html
   My bibliography  Save this article

Revisiting the finance–growth nexus: the Turkish case, 1980–2010

Author

Listed:
  • Mustafa Ismihan
  • Burcu Dinçergök
  • Seyit Mümin Cilasun

Abstract

In Turkey, the empirical results on the link between financial development and economic growth are mixed. The existing studies do not take into account the fact that Turkey has experienced endemic political and economic instabilities over extended periods. This study aims to analyse the role of macroeconomic instability and public borrowing on the finance–growth nexus in Turkey by using time series econometric techniques over the 1980–2010 period. In doing so, we attempt to extend the existing literature by taking into account the role of macroeconomic instability as well as public borrowing. Our results reveal that there are additional – albeit indirect – channels between finance and growth via the effects of macro instability and public borrowing on financial development and economic growth. After taking into account the effects of overall instability and public borrowing, we found that growth–financial development relationship is bidirectional and permanent. In other words, in Turkish case, economic growth and financial development are jointly determined. Thus, our results shed some light on the ambiguity of the evidence on the link between financial development and economic growth for Turkey.

Suggested Citation

  • Mustafa Ismihan & Burcu Dinçergök & Seyit Mümin Cilasun, 2017. "Revisiting the finance–growth nexus: the Turkish case, 1980–2010," Applied Economics, Taylor & Francis Journals, vol. 49(18), pages 1737-1750, April.
  • Handle: RePEc:taf:applec:v:49:y:2017:i:18:p:1737-1750
    DOI: 10.1080/00036846.2016.1226487
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/00036846.2016.1226487
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Serhan Cevik & Mohammad H. Rahmati, 2020. "Searching for the finance–growth nexus in Libya," Empirical Economics, Springer, vol. 58(2), pages 567-581, February.
    2. Emmanuel Carré & Guillaume L’Œillet, 2017. "Une revue de la littérature récente sur le nexus finance-croissance après la crise : apports, limites et pistes de recherche," Revue d'économie financière, Association d'économie financière, vol. 0(3), pages 271-290.
    3. Mehmet Zeki Ak & Mustafa Kirca & Mehmet Nurullah Altintaş, 2016. "The impacts of financial development on growth:A time-varying causality analysis for Turkey," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics, vol. 34(2), pages 529-554.
    4. Carlos Vladimir Rodriguez-Caballero & Daniel Ventosa-Santaularia, 2014. "Granger Causality and Unit Roots," Journal of Statistical and Econometric Methods, SCIENPRESS Ltd, vol. 3(1), pages 1-7.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:applec:v:49:y:2017:i:18:p:1737-1750. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: http://www.tandfonline.com/RAEC20 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.