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Inflation Targeting Framework: Leading Indicator Variables Of Inflation In Turkey

Year 2005, Volume: 14 Issue: 1, 31 - 44, 01.06.2005

Abstract

After the transition to flexible exchange rate regime in Turkey the question of how to implement the monetary policy still maintains its importance The transition to inflation targeting as a new monetary policy implementation that is the use of determined inflation target as nominal anchor requires inflation forecasting models with high level credibility in application This study is concerned with putting forth the leading indicator variables of inflation in Turkey After reviewing the prerequisites for transition to inflation targeting a set of indicator variables of inflation are determined by using VAR analysis Whatever the criticisms against the VAR methodology in choosing the VAR analysis various aspects of it played a crucial role such as having no constraints over the structure of the relation presenting dynamic relations and having no difficulty in deciding which variable is internal and which external Due to the prospective feature of the inflation target forward looking variables indicators are emphasized To this end the analysis made should be regarded as a pre model study on the basis of determinant indicators to be enlarged with policy instruments and new inflation series to be developed Keywords: Inflation Inflation targeting VAR Analysis Monetary policy JEL Classification: E3 E42 E52

References

  • Bardsen, Gunnar; Eilev Jansen and Ragnar Nymoen, (2003), “Econometric inflation targeting”, Econometrics Journal, vol.6, pp. 430-461.
  • Carlstrom, T. Charles; and Timothy S Fuerst, (Feb 2002), “Monetary Rules and Stability: Inflation Targetting versus Price Level Targetting”, Economic Commentary Federal Reserve Bank of Cleveland.
  • Debelle, Guy, (1997), “Inflation targeting in practice”, IMF Working Paper, 97/35.
  • Debelle, Guy and C. Hoon Lim, (1998), “Preliminary Considerations of an Inflation Targetting Framework for Philippines”, IMF Working Paper, 98/39.
  • Fischer, Stanley, (1993),“The role of Macroeconomic Factors in Growth”, NBER Working Paper, no.40565.
  • Green, John H (1996), “Inflation Targeting: Theory and Policy Implications”, IMF Staff Paper, vol.43, pp.779-735.
  • Honda, Yuzo, (2000),“Some tests on the effects of inflation targeting in New Zealand, Canada, and the UK”, Economics Letters, vol.66, pp. 1-6.
  • Kasa, Kenneth, (2001), “Will inflation targeting work in developing countries”, Federal Reserve Bank of San Francisco, vol.2001, Issue 1.
  • Kirbitçioğlu, Aykut, (2002), “Causes of inflation in Turkey: A literature Survey with special reference to Theories of Inflation” in Kirbitçioğlu A.,Libby Rittenberg.and Faruk Selçuk (ed) Inflation and Disinflation in Turkey ,Ashgate, pp.43-76.
  • Kumhof, Michael, “Inflation Targeting under Imperfect Credibility”, Department of Economics Working Paper, Stanford University.
  • Lütkepohl, Helmut, (1991), Introduction to Multiple Time Series Analysis, Springer-Verlag.
  • Rudebusch, G. D.and L.E.O. Svensson, (1999), Policy rules for inflation targeting. In J.B. Taylor(ed.), Monetary Policy Rules, A National Bureau of Economic Research Conference Report, pp.203-62.
  • Svensson, Lars E.O., (2000), “Open-economy inflation targeting”, Journal of International Economics, vol.50, pp.155-183.

Inflation Targeting Framework: Leading Indicator Variables Of Inflation In Turkey

Year 2005, Volume: 14 Issue: 1, 31 - 44, 01.06.2005

Abstract

Türkiye’de esnek döviz kuru uygulamasına geçilmesinin ardından para politikasının ne şekilde uygulanacağı sorusu önemini korumaktadır Yeni bir para politikası uygulaması olarak enflasyon hedeflemesine geçilmesi diğer bir ifade ile nominal çapa olarak belirlenen enflasyon hedefinin kullanılması uygulamada güvenirlik derecesi yüksek enflasyon tahmin modellerinin oluşturulmasını gerektirmektedir Bu çalışma Türkiye’deki enflasyon olgusuna ilişkin gösterge değişkenlerin saptanmasına yöneliktir Enflasyon hedeflemesine geçilebilmesi için gerekli ön koşulların ortaya konulmasının ardından enflasyon üzerinde belirleyici gösterge niteliğinde olan değişkenler VAR analiziyle belirlenmiştir VAR modeline karşı yapılan eleştirilere rağmen enflasyon modellemesi için VAR analizinin seçilmesinde bu analiz tekniğinin yapısal model üzerinde herhangi bir kısıtlama gerektirmeksizin dinamik ilişkileri verebilmesi ve hangi değişkenin içsel hangi değişkenin dışsal olduğuna karar verme zorluğunun yaşanmamasıdır Enflasyon hedefinin geleceğe yönelik olmasından dolayı tahmin modellerinde ileriye dönük belirleyici nitelikteki değişkenlere büyük ağırlık verilmektedir Bu çerçevede çalışma diğer politika araçları ve geliştirilecek yeni enflasyon serileri ile genişletilebilecek belirleyici göstergeler bazında bir ön model çalışması olarak değerlendirilmelidir Anahtar Kelimeler: Enflasyon Enflasyon hedeflemesi VAR analizi Para politikası JEL Sınıflaması: E3 E42 E52

References

  • Bardsen, Gunnar; Eilev Jansen and Ragnar Nymoen, (2003), “Econometric inflation targeting”, Econometrics Journal, vol.6, pp. 430-461.
  • Carlstrom, T. Charles; and Timothy S Fuerst, (Feb 2002), “Monetary Rules and Stability: Inflation Targetting versus Price Level Targetting”, Economic Commentary Federal Reserve Bank of Cleveland.
  • Debelle, Guy, (1997), “Inflation targeting in practice”, IMF Working Paper, 97/35.
  • Debelle, Guy and C. Hoon Lim, (1998), “Preliminary Considerations of an Inflation Targetting Framework for Philippines”, IMF Working Paper, 98/39.
  • Fischer, Stanley, (1993),“The role of Macroeconomic Factors in Growth”, NBER Working Paper, no.40565.
  • Green, John H (1996), “Inflation Targeting: Theory and Policy Implications”, IMF Staff Paper, vol.43, pp.779-735.
  • Honda, Yuzo, (2000),“Some tests on the effects of inflation targeting in New Zealand, Canada, and the UK”, Economics Letters, vol.66, pp. 1-6.
  • Kasa, Kenneth, (2001), “Will inflation targeting work in developing countries”, Federal Reserve Bank of San Francisco, vol.2001, Issue 1.
  • Kirbitçioğlu, Aykut, (2002), “Causes of inflation in Turkey: A literature Survey with special reference to Theories of Inflation” in Kirbitçioğlu A.,Libby Rittenberg.and Faruk Selçuk (ed) Inflation and Disinflation in Turkey ,Ashgate, pp.43-76.
  • Kumhof, Michael, “Inflation Targeting under Imperfect Credibility”, Department of Economics Working Paper, Stanford University.
  • Lütkepohl, Helmut, (1991), Introduction to Multiple Time Series Analysis, Springer-Verlag.
  • Rudebusch, G. D.and L.E.O. Svensson, (1999), Policy rules for inflation targeting. In J.B. Taylor(ed.), Monetary Policy Rules, A National Bureau of Economic Research Conference Report, pp.203-62.
  • Svensson, Lars E.O., (2000), “Open-economy inflation targeting”, Journal of International Economics, vol.50, pp.155-183.
There are 13 citations in total.

Details

Primary Language Turkish
Journal Section Articles
Authors

Aslı Alıcı This is me

Meltem Şengün Ucal This is me

Publication Date June 1, 2005
Submission Date December 29, 2013
Published in Issue Year 2005 Volume: 14 Issue: 1

Cite

APA Alıcı, A., & Ucal, M. Ş. (2005). Inflation Targeting Framework: Leading Indicator Variables Of Inflation In Turkey. Çukurova Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 14(1), 31-44.