THE AVAILABILITY AND EFFICIENCY OF FINANCIAL RESOURCES OF CURRENT ACCOUNT DEFICITS
THE AVAILABILITY AND EFFICIENCY OF FINANCIAL RESOURCES OF CURRENT ACCOUNT DEFICITS

Summary/Abstract: The research seeks to analyze the current account deficit in Turkish economy between 2006 and 2018 on the financial resources by taking into account the sustainability conditions. To this end, we have not restricted the current account deficit with a single indicator. In the research, where four different Vector Autoregressive Models have been created, Zivot-Andrews unit root test has been utilized to see the impact of structural changes in the relevant period. The availability and effectiveness of the financing sources that impact the sustainability of the current account deficit as a policy tool have been analyzed by utilizing the method of Impulse-Response and Variance Decomposition in these models. The empirical findings have indicated that the current account deficit in Turkish economy between 2006-2018 was financed by rather hot money movements and shortterm external debt that have speculative and fragile structure. These results indicate that growth should be disregarded for reducing current account deficit to sustainable level for Turkish economy.

• Details
• Contents