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THE RELATIONSHIP BETWEEN FINANCIAL DEVELOPMENT AND ECONOMIC GROWTH IN TURKEY: EVIDENCE FROM FOURIER TESTS

Year 2021, , 19 - 34, 25.09.2021
https://doi.org/10.46959/jeess.993931

Abstract

Governments aim to increase economic growth with the policies they implement for the development of the financial system in their countries. For this reason, the basic relationship between financial development and economic growth has been widely covered in the literature, especially since the 1980s. In this context, in this study, it is aimed to reveal the relationship between economic growth and financial development for Turkey by using the annual data set covering the period 1960-2017. For this purpose, analyzes were carried out using the data obtained from the official database of the World Bank and the gross domestic product (GDP) series and the ratio of assets of deposit banks to GDP (FD) series. First of all, the investigation of whether the variables contain a unit root was examined by Christopoulos and Leon-Ledesma (2010) Fourier unit root test. The long-term cointegration relationship for series with a stationary difference was examined with the Fourier Autoregressive Distributed Lag (FADL) cointegration analysis, which was brought to the literature by Banerjee et al. (2017), and it was found that there was no long-term relationship between the variables. In order to reveal the causal relationship between the variables, the Fourier-based causality test proposed by Nazlıoglu et al. (2016) was applied. There is a one-way causality relationship between the variables and it has been determined that the financial development series is the cause of economic growth.

References

  • Ağayev, S. (2012). Geçiş ekonomilerinde finansal gelişme ve ekonomik büyüme ilişkisi. Marmara Üniversitesi İktisadi ve İdari Bilimler Dergisi, 32(1), 155-164.
  • Aimer, N. The Direction of Causality between Economic Growth and Financial Development in Upper Middle-Income Countries. Econder International Academic Journal, 5(1), 49-68.
  • Anuya, D. E., & Ifionu, E. P. Financial Market Development And Economic Growth in Sub-Saharan Africa: A Dynamic Panel Gmm Approach.
  • Apergis, N., Filippidis, I., & Economidou, C. (2007). Financial deepening and economic growth linkages: a panel data analysis. Review of World Economics, 143(1), 179-198.
  • Arestis, P., Demetriades, P. O., & Luintel, K. B. (2001). Financial development and economic growth: the role of stock markets. Journal of money, credit and banking, 16-41.
  • Arıç, K. H. (2014). The effects of financial development on economic growth in the European Union: a panel data analysis. International journal of economic practices and theories, 4(4), 466-471.
  • Bakar, H. O., Sulong, Z., & Chowdhury, M. A. F. (2020). The role of financial development on economic growth in the emerging market countries of the sub-Saharan African (SSA) region. International Journal of Emerging Markets.
  • Banerjee, P., Arčabić, V., & Lee, H. (2017). Fourier ADL cointegration test to approximate smooth breaks with new evidence from crude oil market. Economic Modelling, 67, 114-124.
  • Bangake, C., & Eggoh, J. C. (2011). Further evidence on finance-growth causality: A panel data analysis. Economic Systems, 35(2), 176-188.
  • Beck, T., Levine, R., & Loayza, N. (2000). Finance and the Sources of Growth. Journal of financial economics, 58(1-2), 261-300.
  • Bozoklu, Ş., & YILANCI, V. (2013). Finansal Gelişme ve İktisadi Büyüme Arasindaki Nedensellik İlişkisi: Gelişmekte Olan Ekonomiler İçin Analiz. Dokuz Eylül Üniversitesi İktisadi İdari Bilimler Fakültesi Dergisi, 28(2), 161-187.
  • Cheng, C. Y., Chien, M. S., & Lee, C. C. (2021). ICT diffusion, financial development, and economic growth: An international cross-country analysis. Economic modelling, 94, 662-671.
  • Christopoulos, D. K., & León-Ledesma, M. A. (2010). Smooth breaks and non-linear mean reversion: Post-Bretton Woods real exchange rates. Journal of International Money and Finance, 29(6), 1076-1093.
  • Erataş-Sönmez, F., & Sağlam, Y. (2019). The Relationship between Financial Development and Economic Growth for Developing Countries: Panel Causality Analysis. Sosyoekonomi, 27(42), 87-106.
  • Falahaty, M., & Hook, L. S. (2013). The Effect of Financial Development on Economic Growth in the MENA Region. Journal of Economic Cooperation & Development, 34(3).
  • Ferreira, C. (2021). Panel Granger causality between financial development and economic growth.
  • Goldsmith, R. W. (1969). Financial structure and development(Yale University Press. New Haven, CT).
  • De Gregorio, J., & Guidotti, P. E. (1995). Financial development and economic growth. World development, 23(3), 433-448.
  • Gurley, J.G. ve Shaw, E.S. (1960) Money in A Theory of Finance, Washington, DC: Brookings Institution
  • Güney, G. (2017). Ekonomik Büyüme ve Finansal Gelişme İlişkisi: Bir Panel Veri Analizi. Igdir University Journal of Social Sciences, (13).
  • Habibullah, M. S., & Eng, Y. K. (2006). Does financial development cause economic growth? A panel data dynamic analysis for the Asian developing countries. Journal of the Asia Pacific Economy, 11(4), 377-393.
  • Hassan, M. K., Sanchez, B., & Yu, J. S. (2011). Financial development and economic growth: New evidence from panel data. The Quarterly Review of economics and finance, 51(1), 88-104.
  • Hayaloğlu, P. (2015). Kırılgan beşli ülkelerinde finansal gelişme ve ekonomik büyüme ilişkisi: Dinamik panel veri analizi. Ekonomik ve Sosyal Araştırmalar Dergisi, 11(1), 131-144.
  • İnançlı, S., Altıntaş, N., & Veysel, İ. N. A. L. (2016). Finansal gelişme ve ekonomik büyüme ilişkisi: D-8 örneği. Kastamonu Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, 14(4), 36-49.
  • Kandır, S. Y., & İskenderoğlu, A. G. Ö. (2007). Finansal gelişme ve ekonomik büyüme arasındaki ilişkinin araştırılması. Çukurova Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 16(2), 311-326.
  • King, R. G., and R. Levine (1993a). Finance and Growth: Schumpeter Might Be Right. Quarterly Journal of Economics 108 (3): 717–737.
  • King, R. G., and R. Levine (1993b). Finance, Entrepreneurship and Growth. Journal of Monetary Economics 32 (3): 513–542.
  • Konat, G. (2021). Türkiye’de Ar&Ge Harcamaları ve Ekonomik Büyüme İlişkisi: Fourier ADL Eşbütünleşme Analizi. Ekonomik ve Sosyal Araştırmalar Dergisi, 17(1), 133-145.
  • Levine, R. (1997). Financial development and economic growth: views and agenda. Journal of economic literature, 35(2), 688-726.
  • Levine, R., & Zervos, S. (1998). Stock markets, banks, and economic growth. American economic review, 537-558.
  • Luintel, K. B., & Khan, M. (1999). A quantitative reassessment of the finance–growth nexus: evidence from a multivariate VAR. Journal of Development Economics, 60(2), 381–405.
  • McCaig, B., & Stengos, T. (2005). Financial intermediation and growth: Some robustness results. Economics Letters, 88(3), 306-312.
  • McKinnon, R. I. (1973) Money and Capital in Economic Development, Washington, DC: The Brookings Institution.
  • Mehrara, M. and Ghamati, F. (2014). Financial Development And Economic Growth İn Developed Countries. International Letters of Social and Humanistic Sciences, 36: 75-81.
  • Mhadhbi, K. (2014). Relationships between financial development and economic growth: A new approach by inputs. Journal of Empirical Studies, 1(2), 62-84.
  • Naceur, S. B., & Ghazouani, S. (2007). Stock markets, banks, and economic growth: Empirical evidence from the MENA region. Research in International Business and Finance, 21(2), 297-315.
  • Nazlioglu, S., Gormus, N. A., & Soytas, U. (2016). Oil prices and real estate investment trusts (REITs): Gradual-shift causality and volatility transmission analysis. Energy Economics, 60, 168-175.
  • Ozcan, B., & Ari, A. (2011). Finansal Gelisme ve Ekonomik Büyüme Arasindaki Iliskinin Ampirik Bir Analizi: Türkiye Örnegi/An Empirical Analysis of Relationship between Financial Development and Economic Growth: The Turkish Case. Business and Economics Research Journal, 2(1), 121.
  • Pradhan, R. P., Arvin, M. B., & Bahmani, S. (2018). Are innovation and financial development causative factors in economic growth? Evidence from a panel granger causality test. Technological Forecasting and Social Change, 132, 130-142.
  • Rajan, R., & Zingales, L. (1996). Financial dependence and growth. NBER Working Paper 5758.
  • Sağlam, Y., & Sönmez, F. E. (2017). Finansal gelişme ve ekonomik büyüme arasındaki ilişki: Avrupa geçiş ekonomileri örneği. Eskişehir Osmangazi Üniversitesi İktisadi ve İdari Bilimler Dergisi, 12(1), 121-140.
  • Schumpeter JA (1911) Theorie der wirtschaftlichen Entwicklung, 1st edn. Duncker & Humblot, Leipzig
  • Shaw, E. S. (1973) “Financial Deepening in Economic Development”, New York: Oxford University Press.
  • Sönmez, F. E., & Sağlam, Y. (2017). Financial Development and Economic Growth: A Comparative Analysis between Euro Area and Emerging-Developing Europe. Balıkesir Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 20(38), 179-202.
  • Toda, H. Y. & Yamamoto, T. (1995) Statistical inference in vector autoregressions with possibly integrated processes. Journal of Econometrics, 66, 225-250.
  • Wu, J. L., Hou, H., & Cheng, S. Y. (2010). The dynamic impacts of financial institutions on economic growth: Evidence from the European Union. Journal of Macroeconomics, 32(3), 879-891.

TÜRKİYE’DE FİNANSAL GELİŞME ve EKONOMİK BÜYÜME ARASINDAKİ İLİŞKİ: FOURİER TESTLERDEN KANITLAR

Year 2021, , 19 - 34, 25.09.2021
https://doi.org/10.46959/jeess.993931

Abstract

Hükümetler ülkelerindeki finans sisteminin gelişimi için uyguladıkları politikalar ile ekonomik büyümenin arttırılmasını hedeflemektedirler. Bu nedenle özellikle 1980’li yıllardan günümüze kadar finansal gelişme ve ekonomik büyüme arasındaki temel ilişki literatürde geniş bir yer almıştır. Bu bağlamda bu çalışmada, 1960-2017 dönemini kapsayan yıllık veri seti kullanılarak Türkiye için ekonomik büyüme ve finansal gelişme arasındaki ilişki ortaya çıkarılmak istenmektedir. Bu amaçla Dünya Bankası resmi veri tabanından elde edilen veriler ile gayri safi yurtiçi hâsıla (GSYİH) serisi ile mevduat bankalarının varlıklarının GSYİH'ye oranı (FD) serisi kullanılarak analizler gerçekleştirilmiştir. Öncelikle değişkenlerin birim kök içerip içermediğinin araştırılması Christopoulos ve Leon-Ledesma (2010) Fourier birim kök sınaması ile incelenmiştir. Fark durağan bulunan seriler için uzun dönemli eşbütünleşme ilişkisi Banerjee vd. (2017) tarafından literatüre kazandırılan Fourier Otoregresif Gecikmesi Dağıtılmış (FADL) eşbütünleşme analizi ile incelenmiş ve değişkenler arasında uzun dönemli bir ilişki olmadığı bulgusuna ulaşılmıştır. Değişkenler arasındaki nedensel ilişkiyi ortaya çıkarmak adına yine Fourier temelli Nazlıoğlu vd. (2016) tarafından önerilen nedensellik testi uygulanmıştır. Değişkenler arasında tek yönlü bir nedensellik ilişkisi mevcut olup ve finansal gelişme serisinin ekonomik büyümenin nedeni olduğu sonucu tespit edilmiştir.

References

  • Ağayev, S. (2012). Geçiş ekonomilerinde finansal gelişme ve ekonomik büyüme ilişkisi. Marmara Üniversitesi İktisadi ve İdari Bilimler Dergisi, 32(1), 155-164.
  • Aimer, N. The Direction of Causality between Economic Growth and Financial Development in Upper Middle-Income Countries. Econder International Academic Journal, 5(1), 49-68.
  • Anuya, D. E., & Ifionu, E. P. Financial Market Development And Economic Growth in Sub-Saharan Africa: A Dynamic Panel Gmm Approach.
  • Apergis, N., Filippidis, I., & Economidou, C. (2007). Financial deepening and economic growth linkages: a panel data analysis. Review of World Economics, 143(1), 179-198.
  • Arestis, P., Demetriades, P. O., & Luintel, K. B. (2001). Financial development and economic growth: the role of stock markets. Journal of money, credit and banking, 16-41.
  • Arıç, K. H. (2014). The effects of financial development on economic growth in the European Union: a panel data analysis. International journal of economic practices and theories, 4(4), 466-471.
  • Bakar, H. O., Sulong, Z., & Chowdhury, M. A. F. (2020). The role of financial development on economic growth in the emerging market countries of the sub-Saharan African (SSA) region. International Journal of Emerging Markets.
  • Banerjee, P., Arčabić, V., & Lee, H. (2017). Fourier ADL cointegration test to approximate smooth breaks with new evidence from crude oil market. Economic Modelling, 67, 114-124.
  • Bangake, C., & Eggoh, J. C. (2011). Further evidence on finance-growth causality: A panel data analysis. Economic Systems, 35(2), 176-188.
  • Beck, T., Levine, R., & Loayza, N. (2000). Finance and the Sources of Growth. Journal of financial economics, 58(1-2), 261-300.
  • Bozoklu, Ş., & YILANCI, V. (2013). Finansal Gelişme ve İktisadi Büyüme Arasindaki Nedensellik İlişkisi: Gelişmekte Olan Ekonomiler İçin Analiz. Dokuz Eylül Üniversitesi İktisadi İdari Bilimler Fakültesi Dergisi, 28(2), 161-187.
  • Cheng, C. Y., Chien, M. S., & Lee, C. C. (2021). ICT diffusion, financial development, and economic growth: An international cross-country analysis. Economic modelling, 94, 662-671.
  • Christopoulos, D. K., & León-Ledesma, M. A. (2010). Smooth breaks and non-linear mean reversion: Post-Bretton Woods real exchange rates. Journal of International Money and Finance, 29(6), 1076-1093.
  • Erataş-Sönmez, F., & Sağlam, Y. (2019). The Relationship between Financial Development and Economic Growth for Developing Countries: Panel Causality Analysis. Sosyoekonomi, 27(42), 87-106.
  • Falahaty, M., & Hook, L. S. (2013). The Effect of Financial Development on Economic Growth in the MENA Region. Journal of Economic Cooperation & Development, 34(3).
  • Ferreira, C. (2021). Panel Granger causality between financial development and economic growth.
  • Goldsmith, R. W. (1969). Financial structure and development(Yale University Press. New Haven, CT).
  • De Gregorio, J., & Guidotti, P. E. (1995). Financial development and economic growth. World development, 23(3), 433-448.
  • Gurley, J.G. ve Shaw, E.S. (1960) Money in A Theory of Finance, Washington, DC: Brookings Institution
  • Güney, G. (2017). Ekonomik Büyüme ve Finansal Gelişme İlişkisi: Bir Panel Veri Analizi. Igdir University Journal of Social Sciences, (13).
  • Habibullah, M. S., & Eng, Y. K. (2006). Does financial development cause economic growth? A panel data dynamic analysis for the Asian developing countries. Journal of the Asia Pacific Economy, 11(4), 377-393.
  • Hassan, M. K., Sanchez, B., & Yu, J. S. (2011). Financial development and economic growth: New evidence from panel data. The Quarterly Review of economics and finance, 51(1), 88-104.
  • Hayaloğlu, P. (2015). Kırılgan beşli ülkelerinde finansal gelişme ve ekonomik büyüme ilişkisi: Dinamik panel veri analizi. Ekonomik ve Sosyal Araştırmalar Dergisi, 11(1), 131-144.
  • İnançlı, S., Altıntaş, N., & Veysel, İ. N. A. L. (2016). Finansal gelişme ve ekonomik büyüme ilişkisi: D-8 örneği. Kastamonu Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, 14(4), 36-49.
  • Kandır, S. Y., & İskenderoğlu, A. G. Ö. (2007). Finansal gelişme ve ekonomik büyüme arasındaki ilişkinin araştırılması. Çukurova Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 16(2), 311-326.
  • King, R. G., and R. Levine (1993a). Finance and Growth: Schumpeter Might Be Right. Quarterly Journal of Economics 108 (3): 717–737.
  • King, R. G., and R. Levine (1993b). Finance, Entrepreneurship and Growth. Journal of Monetary Economics 32 (3): 513–542.
  • Konat, G. (2021). Türkiye’de Ar&Ge Harcamaları ve Ekonomik Büyüme İlişkisi: Fourier ADL Eşbütünleşme Analizi. Ekonomik ve Sosyal Araştırmalar Dergisi, 17(1), 133-145.
  • Levine, R. (1997). Financial development and economic growth: views and agenda. Journal of economic literature, 35(2), 688-726.
  • Levine, R., & Zervos, S. (1998). Stock markets, banks, and economic growth. American economic review, 537-558.
  • Luintel, K. B., & Khan, M. (1999). A quantitative reassessment of the finance–growth nexus: evidence from a multivariate VAR. Journal of Development Economics, 60(2), 381–405.
  • McCaig, B., & Stengos, T. (2005). Financial intermediation and growth: Some robustness results. Economics Letters, 88(3), 306-312.
  • McKinnon, R. I. (1973) Money and Capital in Economic Development, Washington, DC: The Brookings Institution.
  • Mehrara, M. and Ghamati, F. (2014). Financial Development And Economic Growth İn Developed Countries. International Letters of Social and Humanistic Sciences, 36: 75-81.
  • Mhadhbi, K. (2014). Relationships between financial development and economic growth: A new approach by inputs. Journal of Empirical Studies, 1(2), 62-84.
  • Naceur, S. B., & Ghazouani, S. (2007). Stock markets, banks, and economic growth: Empirical evidence from the MENA region. Research in International Business and Finance, 21(2), 297-315.
  • Nazlioglu, S., Gormus, N. A., & Soytas, U. (2016). Oil prices and real estate investment trusts (REITs): Gradual-shift causality and volatility transmission analysis. Energy Economics, 60, 168-175.
  • Ozcan, B., & Ari, A. (2011). Finansal Gelisme ve Ekonomik Büyüme Arasindaki Iliskinin Ampirik Bir Analizi: Türkiye Örnegi/An Empirical Analysis of Relationship between Financial Development and Economic Growth: The Turkish Case. Business and Economics Research Journal, 2(1), 121.
  • Pradhan, R. P., Arvin, M. B., & Bahmani, S. (2018). Are innovation and financial development causative factors in economic growth? Evidence from a panel granger causality test. Technological Forecasting and Social Change, 132, 130-142.
  • Rajan, R., & Zingales, L. (1996). Financial dependence and growth. NBER Working Paper 5758.
  • Sağlam, Y., & Sönmez, F. E. (2017). Finansal gelişme ve ekonomik büyüme arasındaki ilişki: Avrupa geçiş ekonomileri örneği. Eskişehir Osmangazi Üniversitesi İktisadi ve İdari Bilimler Dergisi, 12(1), 121-140.
  • Schumpeter JA (1911) Theorie der wirtschaftlichen Entwicklung, 1st edn. Duncker & Humblot, Leipzig
  • Shaw, E. S. (1973) “Financial Deepening in Economic Development”, New York: Oxford University Press.
  • Sönmez, F. E., & Sağlam, Y. (2017). Financial Development and Economic Growth: A Comparative Analysis between Euro Area and Emerging-Developing Europe. Balıkesir Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 20(38), 179-202.
  • Toda, H. Y. & Yamamoto, T. (1995) Statistical inference in vector autoregressions with possibly integrated processes. Journal of Econometrics, 66, 225-250.
  • Wu, J. L., Hou, H., & Cheng, S. Y. (2010). The dynamic impacts of financial institutions on economic growth: Evidence from the European Union. Journal of Macroeconomics, 32(3), 879-891.
There are 46 citations in total.

Details

Primary Language Turkish
Subjects Economics
Journal Section Articles
Authors

Eda Fendoğlu 0000-0003-4092-7137

Publication Date September 25, 2021
Published in Issue Year 2021

Cite

APA Fendoğlu, E. (2021). TÜRKİYE’DE FİNANSAL GELİŞME ve EKONOMİK BÜYÜME ARASINDAKİ İLİŞKİ: FOURİER TESTLERDEN KANITLAR. Journal of Empirical Economics and Social Sciences, 3(2), 19-34. https://doi.org/10.46959/jeess.993931