Credit channel and capital flows: A macroprudential policy tool? Evidence from Turkey

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dc.contributor.authorVarlık, Serdar
dc.contributor.authorBerument, M. Hakan
dc.date.accessioned2019-05-13T09:07:19Z
dc.date.available2019-05-13T09:07:19Z
dc.date.issued2016
dc.departmentHitit Üniversitesi, İktisadi ve İdari Bilimler Fakültesi, İktisat Bölümü
dc.description.abstractRapid credit growth induced by sudden capital inflows may negatively affect a country's economic performance, with the resulting outflows turning into a financial crisis. The purpose of this study is to determine whether controlling the credit channel of monetary policy could be used as a macroprudential tool to suppress the effects of sudden capital inflows on economic performance for small open economies like Turkey. In this paper, using the Vector Autoregression methodology employed by (Bernanke, S. B., M. Gertler, and M. Watson. 1997. "Systematic Monetary Policy and the Effects of Oil Price Shocks." Brookings Papers on Economic Activity 1: 91-157), we investigate whether shutting down the credit channel helps reduce the effects of capital inflows. Indeed, empirical evidence from Turkey shows that doing so decreases the effects of capital inflows on imports and industrial production, but further decreases interest rate and prices and further appreciates the domestic currency. Therefore, it may be prudent to support credit control with additional policy tools to prevent a further decrease in interest rate and prices and a further appreciation of the domestic currency. © 2016 by De Gruyter 2016.
dc.identifier.citationVarlık, S., Berument, M. H. (2016). Credit channel and capital flows: a macroprudential policy tool? Evidence from Turkey. The BE Journal of Macroeconomics, 16(1), 145-170.
dc.identifier.doi10.1515/bejm-2015-0052
dc.identifier.endpage170en_US
dc.identifier.issn1935-1690
dc.identifier.issue1en_US
dc.identifier.scopusqualityQ4
dc.identifier.startpage145en_US
dc.identifier.urihttps://doi.org/10.1515/bejm-2015-0052
dc.identifier.urihttps://hdl.handle.net/11491/1776
dc.identifier.volume16en_US
dc.identifier.wosqualityN/A
dc.indekslendigikaynakWeb of Science
dc.indekslendigikaynakScopus
dc.language.isoen
dc.publisherWalter de Gruyter GmbH
dc.relation.ispartofB.E. Journal of Macroeconomics
dc.relation.publicationcategoryMakale - Uluslararası Hakemli Dergi - Kurum Öğretim Elemanı
dc.rightsinfo:eu-repo/semantics/closedAccess
dc.subjectCapital Flowsen_US
dc.subjectCredit Channelen_US
dc.subjectMacroeconomic Prudential Policyen_US
dc.titleCredit channel and capital flows: A macroprudential policy tool? Evidence from Turkey
dc.typeArticle

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