TY  - JOUR
TT  - AN ANALYSIS OF THE RELATIONSHIP BETWEEN HOUSEHOLD SAVINGS AND ECONOMIC GROWTH IN TURKEY
AU  - Erdogdu, Aylin
PY  - 2017
DA  - December
DO  - 10.17261/Pressacademia.2017.741
JF  - PressAcademia Procedia
JO  - PAP
PB  - Suat TEKER
WT  - DergiPark
SN  - 2459-0762
SP  - 29
EP  - 33
VL  - 6
IS  - 1
KW  - Economic growth
KW  - Granger Causality Test
KW  - Households Savings
KW  - Johansen Cointegraiton Test
KW  - Var Analysis
N2  - Objective-The household saving tendency has been accepted as one of the most importantfinancial instruments in the development of the countries for hundred years.The impact of economic crisis have become much more intense, recently due tothe disappearance of borders between the countiries. This situation, whileincreasing households' anxiety about the future, has also strengthened theirsaving tendencies. In Turkey, the decline in household savings, the negativeeffects on macroeconomic data, and the positive effects of savings ondevelopment have all come in to prominence lately. The purpose of study in thiscontext is to investigate the effects causing increase and decrease inhousehold savings of Turkey and to reveal their impact to economic growth. Methodology-In this study, the relationshipbetween household savings and economic growth have been analyzed with the VARmodel given in the quarterly frequency in 2002 / 1-2017 / 1 period data for theTurkish economy. The indicator of the inflation rate is selected as the TUFEprice index which is accepted as the best reflector of the price movements.Concerning the interest rate, the weighted average interest rates applied tothe deposit accounts of the banks are used. Financial deepening is included inthe model by proportioning to M2 / GDP. The high level of this ratio indicatesthat the funds in the financial sector are able to meet the funding demands ofthe real sector. The credit volume, unemployment rate, real exchange rate,industrial production index and manufacturing industry capacity utilizationrate data have been included in the study in order to make the model moresophisticated as they have considerable impact on savings. Finally, Eviews-9program is used for econometric applications. Findings-According to the findings, there is a positive relationship between economicgrowth and savings in the relevant period for the Turkish economy, consistentwith theoretical explanations and earlier empirical studies. However, accordingto the findings of the study, the most important factor determining householdsavings is real exchange rate. In this context, it seems difficult to increasethe household savings in Turkey without stabilizing the exchange rates. Theimplementation of macroeconomic policies that will increase income and reducestructural vulnerabilities will raise the value of the Turkish lira in themedium to long term and will sustain the value of the Turkish lira in the shortterm thus will encourage savings. Theimpact of economic growth on savings comes after the unemployment rate, theinflation indicator, the TUFE price index and the industrial production index,representing the real sector. As a result, the sociological effects of changingconsumption trends are observed. Conclusion-According to the results and inferences of the study; it might be advisableto implement policies that will mobilize market dynamics to improve savings atmicro-scale in policy preferences for increased savings. In general, it mightbe worthy of recommendation to prioritize structural policies that mightinfluence household investment habits. For example, awareness-raising projectsregarding the benefits of saving can be developed in order to increasehousehold savings. The saving culture could be explained via cooperation intechnology and social media in order to disseminate the implementation of theproject to the public. Trainings can be provided to enhance the financialliteracy level of the households and increasing their cognizance with regard tothe subject. It can be argued that dividing the increases in household incomesinto conscious spending and individual pension systems on credit cards willplay an important role in expanding the savings base and rendering the savingssustainable.
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UR  - https://doi.org/10.17261/Pressacademia.2017.741
L1  - https://dergipark.org.tr/en/download/article-file/392988
ER  -