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The Effect of Current Account Deficit on Economic Growth: The Case of Turkey

Author

Listed:
  • Ibrahim Erem Sahin

    () (SELCUK UNIVERSITY)

  • Mehmet Mucuk

    () (SELCUK UNIVERSITY)

Abstract

Current account deficit ise a measurement of a country?s trade in which the value of goods and services it imports exceeds the value of goods and services it exports. Current account deficit has an important role on economic growth for developing countries. The objective of this study is to analyse the relationship between economic growth and current account deficit for Turkey using time series analysis. For this purpose, Gross Domestic Product and Current Account Deficit data of Turkey between the quarterly data including 2002-2013 were used. Empirical findings show that current account deficit affect economic growth negatively for Turkish economy.

Suggested Citation

  • Ibrahim Erem Sahin & Mehmet Mucuk, 2014. "The Effect of Current Account Deficit on Economic Growth: The Case of Turkey," Proceedings of International Academic Conferences 0301828, International Institute of Social and Economic Sciences.
  • Handle: RePEc:sek:iacpro:0301828
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    File URL: https://iises.net/proceedings/11th-international-academic-conference-reykjavik/table-of-content/detail?cid=3&iid=45&rid=1828
    File Function: First version, 2014
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    References listed on IDEAS

    as
    1. Chinn, Menzie D. & Prasad, Eswar S., 2003. "Medium-term determinants of current accounts in industrial and developing countries: an empirical exploration," Journal of International Economics, Elsevier, vol. 59(1), pages 47-76, January.
    2. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-1072, June.
    3. Joshua E. Greene & Magda E. Kandil, 2002. "The Impact of Cyclical Factors on the U. S. Balance of Payments," IMF Working Papers 02/45, International Monetary Fund.
    4. David H. Howard, 1989. "Implications of the U.S. current account deficit," International Finance Discussion Papers 350, Board of Governors of the Federal Reserve System (U.S.).
    5. Helmut Herwartz & Florian Siedenburg, 2007. "Determinants of Current Account Imbalances in 16 OECD Countries: An Out-Of-Sample Perspective," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 143(2), pages 349-374, July.
    6. Howard, David H, 1989. "Implications of the U.S. Current Account Deficit," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 153-165, Fall.
    7. Alberto Bagnai & Stefano Manzocchi, 1999. "Current-Account Reversals in Developing Countries: The Role of Fundamentals," Open Economies Review, Springer, vol. 10(2), pages 143-163, May.
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    More about this item

    Keywords

    Current Account Deficit; Economic Growth; Time Series Analysis; Turkish Economy;

    JEL classification:

    • A19 - General Economics and Teaching - - General Economics - - - Other
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

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