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Testing quantity theory of money for the Turkish economy

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  • Levent, Korap

Abstract

In this paper, it is tried to test the main assumptions of the Quantity Theory of Money for the Turkish economy. Using some contemporaneous estimation techniques to examine the long-run stationary economic relationships on which the quantity theory is constructed, it is found that stationary characteristics of the velocitities of narrowly and broadly defined monetary aggregates cannot be rejected. However, monetary aggregates seem to be endogenous for the long-run evoluation of prices and real income. It is concluded that monetary authorities follow an accommodative monetary policy inside the period given the endogeneity of the monetary variables.

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  • Levent, Korap, 2007. "Testing quantity theory of money for the Turkish economy," MPRA Paper 21704, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:21704
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    References listed on IDEAS

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    Cited by:

    1. Alimi, R. Santos, 2012. "The Quantity Theory of Money and Its Long Run Implications: Empirical Evidence from Nigeria," MPRA Paper 49598, University Library of Munich, Germany.
    2. Levent, Korap, 2009. "The search for co-integration between money, prices and income: low frequency evidence from the Turkish economy," MPRA Paper 19557, University Library of Munich, Germany.
    3. Osuji Casmir Chinaemerem & Nzotta Samuel Mbadike & Ebiringa Oforegbunam Thaddeus & Chigbu Emmanuel Ezeji, 2015. "Money control indicators and investment in Nigeria," International Journal of Innovation and Economic Development, Inovatus Services Ltd., vol. 1(2), pages 12-19, June.

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    More about this item

    Keywords

    Theory of Money ; Neutrality ; Co-integration ; Turkish Economy ;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E41 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Demand for Money

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