Open AccessINTEREST RATES, FISHER EFFECT AND ECONOMIC DEVELOPMENT IN TURKEY, 1989-2011
Author(s) -
Selahattin Güri̇ş,
Burak Güri̇ş,
Turgut Ün
Publication year - 2016
Publication title -
revista galega de economía
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.159
H-Index - 6
eISSN - 2255-5951
pISSN - 1132-2799
DOI - 10.15304/rge.25.2.3740
Subject(s) - fisher hypothesis , econometrics , distributed lag , inflation (cosmology) , cointegration , economics , nominal interest rate , fisher equation , international fisher effect , meaning (existential) , statistics , mathematics , interest rate , real interest rate , macroeconomics , psychology , physics , theoretical physics , psychotherapist
This paper investigates the validity of the Fisher Hypothesis in Turkey coveringthe period 2003 – 2012. To test validity of Fisher Hypothesis, this paper uses anAutoregressive Distributed Lag test for threshold cointegration recently introduced in theliterature by Li and Lee (2010). The empirical results which are obtained from this paperindicate that Fisher hypothesis is valid for Turkey, meaning nominal interest rates wouldbe an important leading indicator for inflation.