Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/130118
Authors: 
Sülkü, Seher Nur
Saraçoğlu, Bedriye
Year of Publication: 
2013
Series/Report no.: 
Discussion Paper, Turkish Economic Association 2013/16
Abstract: 
This study aims to evaluate the vulnerability of the Turkish economy in the context of global crises during the 1998:01-2012:08 period employing signals approach improved by Kaminsky, Lizando and Reinhart (1998) [KLR]. Our study is necessary and timely to assess the fragility of Turkey since the recent crises created a debate on the Turkish economy. We consider more than thirty financial and macroeconomic variables and choose the best performing eighteen variables according to KLR criteria. The real interest rate differential between Turkey and U.S. ranked first according to all the criteria under consideration. Then, we construct composite indices to estimate the probabilities of crises. According to our findings, the probability of a crisis seems very low for Turkey in 2013, as none of the indicators give any signal of a crisis. Even though our study supports the buoyancy of the Turkish economy, it is important to keep monitoring it as global or unexpected developments may create fragilities.
Subjects: 
Economic Vulnerability
2008-09 Crisis
Leading Indicators
Signals Approach
Turkey
JEL: 
F31
F32
F47
H60
Document Type: 
Working Paper

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