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Savings Rates in Turkey: The Prospects For A Sustainable Growth

Author

Listed:
  • Nihal Y ld r m M zrak

    (Anadolu niversitesi, Eskisehir, Turkey,)

  • Muhammet Dastan

    (A r brahim e en niversitesi, Agri, Turkey)

Abstract

The main objective of this study is to reveal the development process of Turkey's savings rates and investigate the causal relationship between domestic savings and sustainable economic growth by employing Hatemi-J (2012) asymmetric causality test under the time series analysis for the period of 1980-2016. Results of the study indicate that the problem of the inadequate level of domestic savings has not been solved yet in Turkey. It is seen that domestic savings in Turkey have remarkably declined mainly from the 1990s and remain considerably low level at 14 percent over the past few years. It is also seen that Turkey's domestic savings remain considerably below that of the world average and most of the different income group countries. Besides, Hatemi-J (2012) asymmetric causality test results indicate that there is an existence of causality running from positive shocks on real GDP (RGDP) to positive shocks on gross domestic savings (GDS) at 1% significance level while positive shocks on GDS cause positive shocks on RGDP at 5% significance level. This study, however, could not find evidence of any causal relationship between negative shocks on GDS (RGDP) and negative shocks on RGDP (GDS) at an appropriate significance level.

Suggested Citation

  • Nihal Y ld r m M zrak & Muhammet Dastan, 2018. "Savings Rates in Turkey: The Prospects For A Sustainable Growth," International Journal of Economics and Financial Issues, Econjournals, vol. 8(2), pages 227-237.
    • Handle: RePEc:eco:journ1:2018-02-27
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    References listed on IDEAS

    as
    1. Pradeep Agrawal, 2001. "The relation between savings and growth: cointegration and causality evidence from Asia," Applied Economics, Taylor & Francis Journals, vol. 33(4), pages 499-513.
    2. Nurudeen ABU, 2010. "Saving-Economic Growth Nexus In Nigeria, 1970-2007: Granger Causality And Co-Integration Analyses," Review of Economic and Business Studies, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, issue 5, pages 93-104, June.
    3. Pradeep Agrawal & Pravakar Sahoo, 2009. "Savings and growth in Bangladesh," Journal of Developing Areas, Tennessee State University, College of Business, vol. 42(2), pages 89-110, January-M.
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    More about this item

    Keywords

    Sustainable Growth; Domestic Savings; Hatemi-J Asymmetric Causality Test.;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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