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The Determinants of Dollarization in Turkey: An Econometric Analysis

Year 2021, Volume: 5 Issue: 2, 108 - 118, 31.12.2021
https://doi.org/10.35342/econder.937985

Abstract

The aim of the study is to investigate the determinants of dollarization in Turkey. For this purpose, the 2013M1-2021M2 period was analyzed with monthly data using regression and causality tests. As a result of the regression analysis, a positive relationship was found between international reserves and returns of financial investment instruments and dollarization. On the other hand, a negative relationship was found between domestic and foreign interest rates difference and exchange rate and dollarization. As a result of the Granger causality test, a one-sided causality was found from international reserves and returns of financial investment instruments to dollarization. In addition, a one-sided causality relationship has been found from dollarization to exchange rate. Policy implications have been made in the context of the results of the study and some suggestions have been made for future studies.

References

  • Akinlo, A. (2003). Exchange rate depreciation and currency substitution in Nigeria. African Review of Money Finance and Banking. 16(1). 139-143.
  • Anghelance, C. & Anghel, M. G. (2014). Using the Regression Model For The Portfolios Analysis and Management. Theoretical and Applied Economics. 21(4). 53-66.
  • Arango, S. & Nadiri, M. (1981). Demand for Money in Open Economies. Journal of Monetary Economics. 7(1). 69-83.
  • Arteta, C. (2002). Exchange Rate Regimes and Financial Dollarization: Does Flexibility Reduce Bank Currency Mismatches?. International Finance Discussion Papers. 738. Board of Governors of the Federal Reserve System, Washington.
  • Asteriou, D. & Hall, S.G. (2011). Applied econometrics. New York, NY: Palgrave Macmillan.
  • Baliño, T., Bennett, A. & Borenzstein, E, (1999). Monetary Policy in Dollarized Economies, Occasional Paper, No. 171, the International Monetary Fund.
  • Basso, H., Calvo-Gonzalez, O. & Jurgilas, M. (2011). Financial dollarization: The role of foreign-owned banks and interest rates. Journal of Banking & Finance. 35(4). 794-806.
  • Bordo, M. & Choudhri, E. (1982). Currency Substitution and Demand for Money: Some Evidence from Canada. Journal of Money, Credit and Banking. 14(1). 48-57.
  • De Nicoló, G. Honohan, P. & Ize, A. (2005). Dollarization of bank deposits: causes and consequences. Journal of Banking and Finance. 29(7). 1697-1727.
  • Granger, C. W. (1969). Investigating Causal Relations by Econometric Models and Cross-spectral Methods. Econometrica. 37(3). 424-438.
  • Işık, S. (2019). Dollarization and Bank Performance, (Master Thesis). Middle East Technical University), Ankara.
  • Ize, A. & Levy-Yeyati, E. (2003). Financial Dollarization. Journal of International Economics. 59(2003). 323-347.
  • Kaya, E. & Açdoyuran, B. (2017). Finansal Dolarizasyon Unsurları Olarak Kredi Dolarizasyonu ve Mevduat Dolarizasyonu ile Hisse Senedi Getirileri Arasındaki İlişki. Dicle Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi. 7(14). 325-344.
  • Metin Özcan, K. & Us, V. (2006). Dolarizasyon Sürecinde Son Gelişmeler: Türkiye ekonomisi Örneği. TİSK Akademi, 98-115.
  • Mundell, R. A. (1963). Capital mobility and stabilization policy under fixed and flexible exchange rates. The Canadian Journal of Economics and Political Science. 29(4). 475-485.
  • Raheem, İ. & Asongu, S. (2018). Extending the determinants of dollarization in sub-Saharan Africa: The role of easy access to foreign exchange earnings. Research in International Business and Finance. 45. 106-120.
  • Sahay, R. & Vegh, C. (1996). Dollarization in Transition Economies: Evidence and Policy Implications. IMF Working Paper. 95/96.
  • Savastano, M. (1996). Dollarization in Latin America: Recent Evidence and Some Policy Issues. IMF Working Paper. 96/4.
  • Tarawalie, A. & Jalloh, A. (2020). Dollarization in Sierra Leone: Evidence and Some Policy Options. Applied Economics and Finance. 7(4). 160-168.
  • Turanlı, M. & Güriş, S. (2015). Temel İstatistik. 5. Edition, İstanbul: Der Yayınları.

Türkiye'de Dolarizasyonun Belirleyicileri: Ekonometrik Bir Analiz

Year 2021, Volume: 5 Issue: 2, 108 - 118, 31.12.2021
https://doi.org/10.35342/econder.937985

Abstract

Çalışmanın amacı, Türkiye'de dolarizasyonun belirleyicilerini incelemektir. Bu amaçla 2013M1-2021M2 dönemi regresyon ve nedensellik testleri kullanılarak aylık verilerle analiz edilmiştir. Yapılan regresyon analizi sonucunda uluslararası rezervler ile finansal yatırım araçlarının getirileri ile dolarizasyon arasında pozitif yönlü bir ilişki bulunmuştur. Öte yandan, yurt içi ve yurt dışı faiz farkı ile döviz kuru ve dolarizasyon arasında negatif bir ilişki bulunmuştur. Granger nedensellik testi sonucunda uluslararası rezervlerden ve finansal yatırım araçlarının getirilerinden dolarizasyona doğru tek yönlü bir nedensellik bulunmuştur. Ayrıca dolarizasyondan döviz kuruna doğru tek yönlü bir nedensellik ilişkisi bulunmuştur. Çalışmanın sonuçları bağlamında politika çıkarımları yapılmış ve gelecek çalışmalar için bazı önerilerde bulunulmuştur.

References

  • Akinlo, A. (2003). Exchange rate depreciation and currency substitution in Nigeria. African Review of Money Finance and Banking. 16(1). 139-143.
  • Anghelance, C. & Anghel, M. G. (2014). Using the Regression Model For The Portfolios Analysis and Management. Theoretical and Applied Economics. 21(4). 53-66.
  • Arango, S. & Nadiri, M. (1981). Demand for Money in Open Economies. Journal of Monetary Economics. 7(1). 69-83.
  • Arteta, C. (2002). Exchange Rate Regimes and Financial Dollarization: Does Flexibility Reduce Bank Currency Mismatches?. International Finance Discussion Papers. 738. Board of Governors of the Federal Reserve System, Washington.
  • Asteriou, D. & Hall, S.G. (2011). Applied econometrics. New York, NY: Palgrave Macmillan.
  • Baliño, T., Bennett, A. & Borenzstein, E, (1999). Monetary Policy in Dollarized Economies, Occasional Paper, No. 171, the International Monetary Fund.
  • Basso, H., Calvo-Gonzalez, O. & Jurgilas, M. (2011). Financial dollarization: The role of foreign-owned banks and interest rates. Journal of Banking & Finance. 35(4). 794-806.
  • Bordo, M. & Choudhri, E. (1982). Currency Substitution and Demand for Money: Some Evidence from Canada. Journal of Money, Credit and Banking. 14(1). 48-57.
  • De Nicoló, G. Honohan, P. & Ize, A. (2005). Dollarization of bank deposits: causes and consequences. Journal of Banking and Finance. 29(7). 1697-1727.
  • Granger, C. W. (1969). Investigating Causal Relations by Econometric Models and Cross-spectral Methods. Econometrica. 37(3). 424-438.
  • Işık, S. (2019). Dollarization and Bank Performance, (Master Thesis). Middle East Technical University), Ankara.
  • Ize, A. & Levy-Yeyati, E. (2003). Financial Dollarization. Journal of International Economics. 59(2003). 323-347.
  • Kaya, E. & Açdoyuran, B. (2017). Finansal Dolarizasyon Unsurları Olarak Kredi Dolarizasyonu ve Mevduat Dolarizasyonu ile Hisse Senedi Getirileri Arasındaki İlişki. Dicle Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi. 7(14). 325-344.
  • Metin Özcan, K. & Us, V. (2006). Dolarizasyon Sürecinde Son Gelişmeler: Türkiye ekonomisi Örneği. TİSK Akademi, 98-115.
  • Mundell, R. A. (1963). Capital mobility and stabilization policy under fixed and flexible exchange rates. The Canadian Journal of Economics and Political Science. 29(4). 475-485.
  • Raheem, İ. & Asongu, S. (2018). Extending the determinants of dollarization in sub-Saharan Africa: The role of easy access to foreign exchange earnings. Research in International Business and Finance. 45. 106-120.
  • Sahay, R. & Vegh, C. (1996). Dollarization in Transition Economies: Evidence and Policy Implications. IMF Working Paper. 95/96.
  • Savastano, M. (1996). Dollarization in Latin America: Recent Evidence and Some Policy Issues. IMF Working Paper. 96/4.
  • Tarawalie, A. & Jalloh, A. (2020). Dollarization in Sierra Leone: Evidence and Some Policy Options. Applied Economics and Finance. 7(4). 160-168.
  • Turanlı, M. & Güriş, S. (2015). Temel İstatistik. 5. Edition, İstanbul: Der Yayınları.
There are 20 citations in total.

Details

Primary Language English
Subjects Economics
Journal Section Articles
Authors

Mustafa Batuhan Tufaner 0000-0003-0415-4368

Publication Date December 31, 2021
Published in Issue Year 2021 Volume: 5 Issue: 2

Cite

APA Tufaner, M. B. (2021). The Determinants of Dollarization in Turkey: An Econometric Analysis. Econder International Academic Journal, 5(2), 108-118. https://doi.org/10.35342/econder.937985

Econder International Academic Journal is  an international, peer-reviewed multidisciplinary journal dedicated to publishing scholarly articles on all aspects of Economy and Business. Available online and published two times a year, the journal aims to become one of the leading platforms in the world for new findings and discussions of all fields of Economy and Business.


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