International Conference on Eurasian Economies
17-18 September 2013 – St. Petersburg, RUSSIA
Paper detail
Paper ID : 695
Status : Paper published
Language : English
Topic : Growth and Development
Presenter: Prof. Dr. Muhsin Kar
Session : 4A Growth & Development
Trade Openness, Financial Development, and Economic Growth in Turkey: Linear and Nonlinear Causality Analysis
Trade Openness, Financial Development, and Economic Growth in Turkey: Linear and Nonlinear Causality Analysis
- Prof. Dr. Muhsin Kar (Necmettin Erbakan University, Türkiye)
- Prof. Dr. Şaban Nazlıoğlu (Pamukkale University, Türkiye)
- Asst. Prof. Dr. Hüseyin Ağır (Sütçü İmam University, Türkiye)
Abstract
This paper aims at empirically investigating the direction of causality among trade liberalization, financial development, and economic growth in Turkey. By employing monthly data for the period January, 1989- November, 2007, both linear and nonlinear causality approaches indicate that (i) there is bi-directional causality between economic growth and trade openness, (ii) economic growth causes financial development, and (iii) financial development leads to trade liberalization. Thereby, linear and nonlinear approaches confirm strong causal linkages among financial development, trade openness, and economic growth in Turkey. These results partially imply that economic growth depends upon trade liberalization through external finance in Turkey which has been experiencing capital account liberalization since 1989.
JEL codes: E44, F13, C22
Kar, Muhsin, Nazlıoğlu, Şaban, Ağır, Hüseyin (2013). "Trade Openness, Financial Development, and Economic Growth in Turkey: Linear and Nonlinear Causality Analysis" in Proceedings of International Conference of Eurasian Economies 2013, pp.133-143, St. Petersburg, RUSSIA.
DOI: https://doi.org/10.36880/C04.00695
Session 4A: Growth & Development
