A nonlinear investigation of the twin deficits hypothesis over the business cycle: Evidence from Turkey

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dc.contributor.authorCatik, Abdurrahman Nazif
dc.contributor.authorGok, Baris
dc.contributor.authorAkseki, Utku
dc.date.accessioned2019-10-27T22:28:00Z
dc.date.available2019-10-27T22:28:00Z
dc.date.issued2015
dc.departmentEge Üniversitesien_US
dc.description.abstractIn this paper, we analyze the twin deficits hypothesis covering the period from 1994 to 2012 in Turkey. In contrast to previous studies on Turkey, the existence of twin deficits is investigated by regime-dependent impulse response functions and forecast error variance decompositions based on a multivariate two-regime threshold VAR (WAR) model. Our results suggest that the dynamics between the current account and budget account variables are affected by macroeconomic activity: twin deficits are only the case in the upper regime, when the economy operates above its potential level. When the economy is in the lower regime, budget and trade deficits show divergent movements. The results are consistent with Kim and Roubini (2008), indicating that the divergence of fiscal balance and current account might be explained by the cyclical fluctuations of output. (C) 2014 Elsevier By. All rights reserved.en_US
dc.identifier.doi10.1016/j.ecosys.2014.05.002
dc.identifier.endpage196en_US
dc.identifier.issn0939-3625
dc.identifier.issn1878-5433
dc.identifier.issn0939-3625en_US
dc.identifier.issn1878-5433en_US
dc.identifier.issue1en_US
dc.identifier.scopusqualityN/Aen_US
dc.identifier.startpage181en_US
dc.identifier.urihttps://doi.org/10.1016/j.ecosys.2014.05.002
dc.identifier.urihttps://hdl.handle.net/11454/50819
dc.identifier.volume39en_US
dc.identifier.wosWOS:000353601800011en_US
dc.identifier.wosqualityQ3en_US
dc.indekslendigikaynakWeb of Scienceen_US
dc.indekslendigikaynakScopusen_US
dc.language.isoenen_US
dc.publisherElsevier Science Bven_US
dc.relation.ispartofEconomic Systemsen_US
dc.relation.publicationcategoryMakale - Uluslararası Hakemli Dergi - Kurum Öğretim Elemanıen_US
dc.rightsinfo:eu-repo/semantics/closedAccessen_US
dc.subjectBudget accounten_US
dc.subjectCurrent accounten_US
dc.subjectThreshold VAR modelen_US
dc.subjectBusiness cycleen_US
dc.titleA nonlinear investigation of the twin deficits hypothesis over the business cycle: Evidence from Turkeyen_US
dc.typeArticleen_US

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