Testing the Validity of the Triplet Deficit Hypothesis for Turkey: Asymmetric Causality Analysis

Authors

  • Yusuf Ekrem AKBAŞ Adıyaman University
  • Fuat LEBE Adıyaman University
  • Fatma ZEREN Inonu University

Keywords:

Triplet Deficit, Current Account Balance, Budget, Saving-Investment, Asymmetric Causality

Abstract

In this study, the validity was analyzed of the triple deficit hypothesis in Turkey between the years 1960 and 2012. First, the stationarity of positive and negative shocks related to the current account deficit, budget deficit, and savings gap was tested. As a result of unit root tests, it was concluded that all the positive and negative shocks were I(1). Then, the causal relationship was analyzed with regard to the aforesaid shocks of variables by means of an asymmetric causality test. As a result of the asymmetric causality test, bi-directional causality was found between the current account deficit and the budget deficit and between the current account deficit and savings gap. Therefore, it can be concluded that the triple deficit hypothesis is valid in Turkey.

Published

30-11-2014

How to Cite

AKBAŞ, Y. E., LEBE, F., & ZEREN, F. (2014). Testing the Validity of the Triplet Deficit Hypothesis for Turkey: Asymmetric Causality Analysis. Eurasian Journal of Business and Economics, 7(14), 137-154. Retrieved from https://www.ejbe.org/index.php/EJBE/article/view/137

Issue

Section

Articles