Review article
https://doi.org/10.18045/zbefri.2016.2.529
The impacts of financial development on growth: A time-varying causality analysis for Turkey
Mehmet Zeki Ak
; Department of Economics, Faculty of Political Sciences, Sakarya University, Sakarya, Turkey
Mustafa Kirca
; Institute of Social Sciences, Anadolu University, Eskişehir, Turkey
Nurullah Altintaş
; Department of Economics, Faculty of Political Sciences, Sakarya University, Sakarya, Turkey
Abstract
The goal of this research is to determine whether the causal relationship between
financial development and economic growth in Turkey is stable over time. For this
purpose, causal relationship between financial development and economic growth
in Turkey has been investigated by means of annual data for the period of 1960-
2013. Differently from previous studies in the literature, considering that causal
relationship between financial development and economic growth might change
depending on time, time-varying causality test developed by Balcilar, Ozdemir and
Arslanturk (2010) has been used. The results show that there is a unidirectional
causal relationship from financial development to economic growth and this
relationship changes depending on time. It is seen that unidirectional causality
from financial development to economic growth emerged during the periods of
financial turmoil and political crisis. The basic conclusion is that there is no stable
causal relationship between financial development and economic growth in Turkey
over the given time period.
Keywords
Financial development; growth; time-varying causality
Hrčak ID:
171158
URI
Publication date:
22.12.2016.
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