Work

The Effects of Financial Development on Investment in Turkey

Year: 2015

Type: article

Abstract: Analyzing financial development and investment in Turkey between 1960 and 2008, this paper illustrates how financial development affects investment decisions in a dynamic model of the firm under financial frictions. A composite index is constructed of three alternative financial development measures. The bounds testing approach was used to test for the existence of long-run levels relationships and long-run levels relationships were estimated using the autoregressive distributed lag method. Both short- and long-run causality tests were performed. Results indicate that financial development, budget balance, and total credit to the private sector positively and significantly affect investment.

Source: The Singapore Economic Review

DOI: 10.1142/s0217590816500028

Authors: MEHMET BALCILAR, SERHAN ÇIFTÇIOĞLU, HASAN GÜNGÖR

Institutions: Eastern Mediterranean University, University of Pretoria

Language: English

Topic: Monetary Policy and Economic Impact

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: green

Funder: Innovative Research Group Project of the National Natural Science Foundation of China