IDEAS home Printed from https://ideas.repec.org/p/tcb/wpaper/1310.html
   My bibliography  Save this paper

Household Expectations and Household Consumption Expenditures : The Case of Turkey

Author

Listed:
  • Evren Ceritoglu

Abstract

The empirical analysis confirms that household expectations have a direct role on their consumption and saving behaviour in addition to their indirect influence through the income channel. The econometric results show that there is a positive and statistically significant relationship between the growth of consumption and expected income changes. Therefore, the strict version of the rational expectations permanent income hypothesis (REPIH) is rejected for the Turkish economy. The empirical analysis reveals that the expansion of the real consumer credit volume is more important on the growth of consumption than the real interest rates. Moreover, there is a positive and statistically significant relationship between the Job Opportunities Index from the TURKSTAT-CBRT Consumer Tendency Survey and the growth of consumption. Household expenditures on durable goods are more sensitive to changes in household expectations, the real interest rates and consumer credits than household expenditures on non-durable goods and services. As a result, the econometric results are in favour of the precautionary saving hypothesis.

Suggested Citation

  • Evren Ceritoglu, 2013. "Household Expectations and Household Consumption Expenditures : The Case of Turkey," Working Papers 1310, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
    • Handle: RePEc:tcb:wpaper:1310
    as

    Download full text from publisher

    File URL: https://www.tcmb.gov.tr/wps/wcm/connect/EN/TCMB+EN/Main+Menu/Publications/Research/Working+Paperss/2013/13-10
    Download Restriction: no
    ---><---

    Citations

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


    Cited by:

    1. Oguzhan Cepni & Yavuz Selim Hacihasanoglu & Muhammed Hasan Yilmaz, 2020. "Credit decomposition and economic activity in Turkey: A wavelet-based approach," Central Bank Review, Research and Monetary Policy Department, Central Bank of the Republic of Turkey, vol. 20(3), pages 109-131.
    2. Hatice Gökçe Karasoy Can & Çağlar Yüncüler, 2018. "The Explanatory Power and the Forecast Performance of Consumer Confidence Indices for Private Consumption Growth in Turkey," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 54(9), pages 2136-2152, July.
    3. Alper Duman, 2013. "Household Debt in Turkey: The Critical Threshold for the Next Crisis," EcoMod2013 5259, EcoMod.

    More about this item

    Keywords

    Household expectations; Household consumption; Durable goods;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:tcb:wpaper:1310. See general information about how to correct material in RePEc.

    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: Sermet Pekin or Ilker Cakar or the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/tcmgvtr.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.