Can a Two-Sector Business Cycle Model Account for the 2001 Recession of Turkey?

This paper investigates whether a two-sector small open economy real business cycle model calibrated to match Turkish data is able to account for the simultaneous sharp reversal in the current account, real exchange rate depreciation, and the severe recession observed in the aftermath of the 2001 financial and currency crisis of Turkey. Estimated shocks for the model's eight exogenous variables are used to simulate model dynamics, and the resulting time series are compared to the actual series. The model does a fairly good job in matching the output drop, while it faces difficulty in matching the sharp real exchange rate depreciation.Business cycles, Turkey

Interest Rates and Real Business Cycles in Emerging Markets

We study the quantitative effects of interest rates on the business cycles of emerging markets. The real business cycle model featured in Neumeyer and Perri (“Business cycles in emerging economies: The role of interest rates.” Journal of Monetary Economics, March 2005, 52 (2), 345-380.) is calibrated to match Turkish data. Fluctuations in country spread account for only less than 9 percent of output volatility, less than one-third of the value found in Neumeyer and Perri. We show that their result critically depends on the magnitude of the working capital parameter, the persistence of productivity shocks, and the factor shares. Our simulations highlight the importance of country spreads for the volatility of investment and the cyclicality of net exports. We also discuss the effect of correlated shocks on the countercyclicality of real interest rate and net exports.

Interest Rates and Real Business Cycles in Emerging Markets (Yukselen Piyasalarda Faiz Oranlari ve Reel Is Cevrimleri)

We study the quantitative effects of interest rates on the business cycles of emerging markets. The real business cycle model featured in Neumeyer and Perri ("Business cycles in emerging economies : The role of interest rates."Journal of Monetary Economics, March 2005, 52 (2), 345-380.) is calibrated to match Turkish data. Fluctuations in country spread account for only less than 9 percent of output volatility, less than one third of the value found in Neumeyer and Perri. We show that their result critically depends on the magnitude of the working capital parameter, the persistence of the productivity shocks, and the factor shares. We also discuss the effect of correlated shocks on the countercyclicality of the interest rate and net exports.

Zorunlu Karsiliklarin Para Politikasindaki Yeri

[TR] Bu calismada, zorunlu karsiliklarin para politikasindaki yeri kuresel finans krizi sonrasinda olusan yeni iktisadi konjonkturun ortaya koydugu gereksinimler baglaminda incelenmektedir. Zorunlu karsiliklarin para politikasi acisindan onemi, zorunlu karsiliklarin, politika faizinin aksine yalnizca belirli faiz oranlari uzerinde etkili olmasindan oturu, sermaye akimlarini artirmadan sikilastirici para politikasi uygulama imkani tanimasindan kaynaklanmaktadir. Calismada, zorunlu karsiliklarin kredi ve mevduat faizleri uzerindeki etkisi maliyet ve likidite kanallari uzerinden irdelenmektedir. [EN] In this study, we examine the role of reserve requirements as a monetary policy tool in the backdrop of the requirements emerged as a result of the new economic environment following the global financial crisis. The importance of reserve requirements, unlike the policy rate, stems from its ability to affect only certain interest rates, hence allowing the central bank to pursue countercyclical monetary policy without attracting capital inflows. The effect of reserve requirements on credit and deposit rates is analyzed through cost and liquidity channels.