International Conference on Eurasian Economies
1-3 July 2014 – Skopje, MACEDONIA
Paper detail
Paper ID : 1000
Status : Paper published
Language : English
Topic : Finance and Financial Crises
Presenter: Assoc. Prof. Dr. Kenan Lopcu
Session : 5A Macroeconomics
Taylor Rule in an Open Economy: Has the Conduct of Monetary Policy Changed in Turkey?
Taylor Rule in an Open Economy: Has the Conduct of Monetary Policy Changed in Turkey?
- Assoc. Prof. Dr. Kenan Lopcu (Çukurova University, Türkiye)
Abstract
This paper studies whether the conduct of monetary policy has changed in Turkey since 1990s by investigating structural changes in a Taylor type of policy rule. Using recently developed econometric techniques (Kejriwal and Perron, 2010), I first test whether structural breaks have occurred in the policy rule. If the tests corroborate the existence of breaks, then I test whether the relevant variables are indeed cointegrated, following Arai and Kurozumi (2007) and Kejriwal (2008). Finally, I estimate the Taylor-type policy rules for each era to see how the conduct of monetary policy may have changed over time. Contrary to a common belief, the results indicate that no significant changes have occurred in the conduct of monetary policy in Turkey since the 1990s.
JEL codes: C22, E52, E58
Lopcu, Kenan (2014). "Taylor Rule in an Open Economy: Has the Conduct of Monetary Policy Changed in Turkey?" in Proceedings of International Conference of Eurasian Economies 2014, pp.158-165, Skopje, MACEDONIA.
DOI: https://doi.org/10.36880/C05.01000
