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Financial Openness in Turkey


  • Oguz Esen


The purpose of this paper is to analyse the effects of financial liberalization on the financial and real sectors of the Turkish economy. The process of liberalization began over 15 years ago simultaneously with a stabilization programme that had been designed according to neoclassical model. The implementation addressed first foreign trade, then the domestic financial market and finally foreign capital movements. Contrary to theoretical expectations, the opening of the capital account induced adverse effects on financial intermediation, savings, investment, growth and foreign debt.

Suggested Citation

  • Oguz Esen, 2000. "Financial Openness in Turkey," International Review of Applied Economics, Taylor & Francis Journals, vol. 14(1), pages 5-23.
  • Handle: RePEc:taf:irapec:v:14:y:2000:i:1:p:5-23
    DOI: 10.1080/026921700101452

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    References listed on IDEAS

    1. A. Erinc Yeldan, 1998. "On Structural Sources of the 1994 Turkish Crisis: a CGE modelling analysis," International Review of Applied Economics, Taylor & Francis Journals, vol. 12(3), pages 397-414.
    2. Rodrik, Dani, 1995. "Political economy of trade policy," Handbook of International Economics,in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 28, pages 1457-1494 Elsevier.
    3. Bernhard Fischer & Helmut Reisen, 1992. "Towards Capital Account Convertibility," OECD Development Centre Policy Briefs 4, OECD Publishing.
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    Cited by:

    1. Secil Pacaci Elitok & Al Campbell, 2008. "The Balance of Payments as a Constraint on Turkey’s Growth: 1960-2004," Working Paper Series, Department of Economics, University of Utah 2008_13, University of Utah, Department of Economics.
    2. Ä°mre ERSOY, 2011. "On Reserve Hoarding In Emes: The Case Of Turkey," Journal of Applied Economic Sciences, Spiru Haret University, Faculty of Financial Management and Accounting Craiova, vol. 6(3(17)/ Fa), pages 230-243.
    3. Can ERBIL & Durmus OZDEMIR, "undated". "Does Financial Liberalization Trigger Long-Run Economic Growth?," EcoMod2008 23800033, EcoMod.
    4. Halicioglu, Ferda, 2007. "The Financial Development and Economic Growth Nexus for Turkey," MPRA Paper 3566, University Library of Munich, Germany.
    5. Guncavdi Oner & Kucukcifci Suat, 2005. "Financial Reforms and the Decomposition of Economic Growth: An Investigation of the Changing Role of the Financial Sector in Turkey," Review of Middle East Economics and Finance, De Gruyter, vol. 3(1), pages 61-84, April.
    6. Bayraktar, Nihal & Yan Wang, 2004. "Foreign bank entry, performance of domestic banks, and sequence of financial liberalization," Policy Research Working Paper Series 3416, The World Bank.

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