The Dynamics of Output Gap Hysteresis in Türkiye
The aim of this study is to identify the dynamics and hysteresis of the output gap. First, the existence of an output gap in the Turkish economy for the period 2005Q4:2021Q3 is determined using the Hodrick-Prescott and Baxter-King methods, and then the structural break procedure, which is widely use...
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Ekonomi ve Finansal Araştırmalar Derneği
2025-03-01
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| Series: | Ekonomi, Politika & Finans Araştırmaları Dergisi |
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| Online Access: | https://dergipark.org.tr/tr/download/article-file/4327664 |
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| author | Harun Bal Neşe Algan Koray Yıldırım |
| author_facet | Harun Bal Neşe Algan Koray Yıldırım |
| author_sort | Harun Bal |
| collection | DOAJ |
| description | The aim of this study is to identify the dynamics and hysteresis of the output gap. First, the existence of an output gap in the Turkish economy for the period 2005Q4:2021Q3 is determined using the Hodrick-Prescott and Baxter-King methods, and then the structural break procedure, which is widely used in the literature, is applied to detect hysteresis. The presence of a structural break supports the existence of hysteresis in the output gap. In addition, a structural VAR model is estimated with money supply, capacity utilization rate, and capital productivity variables as components of the output gap. While the empirical evidence points to the role of capacity utilization and productivity variables in explaining hysteresis, capacity utilization shocks are relatively stronger determinants of output gap hysteresis. For future studies, the effect of money supply on capacity utilization and productivity, labor productivity, etc., should be monitored. The novelty of the study is the modeling of hysteresis in a structure that includes demand-side and supply-side components. This innovation allows it to act as a guide for policymaking by taking into account the dynamic conditions appropriate to the nature of hysteresis beyond the static situation, such as the detection of hysteresis in the literature. |
| format | Article |
| id | doaj-art-d3b53e459d2b48b68b2561b08da2ad5b |
| institution | OA Journals |
| issn | 2587-151X |
| language | English |
| publishDate | 2025-03-01 |
| publisher | Ekonomi ve Finansal Araştırmalar Derneği |
| record_format | Article |
| series | Ekonomi, Politika & Finans Araştırmaları Dergisi |
| spelling | doaj-art-d3b53e459d2b48b68b2561b08da2ad5b2025-08-20T02:17:28ZengEkonomi ve Finansal Araştırmalar DerneğiEkonomi, Politika & Finans Araştırmaları Dergisi2587-151X2025-03-0110112610.30784/epfad.1576481957The Dynamics of Output Gap Hysteresis in TürkiyeHarun Bal0https://orcid.org/0000-0003-0878-8253Neşe Algan1https://orcid.org/0000-0001-7989-1114Koray Yıldırım2https://orcid.org/0000-0002-2524-1746ÇUKUROVA ÜNİVERSİTESİÇUKUROVA ÜNİVERSİTESİÇUKUROVA ÜNİVERSİTESİThe aim of this study is to identify the dynamics and hysteresis of the output gap. First, the existence of an output gap in the Turkish economy for the period 2005Q4:2021Q3 is determined using the Hodrick-Prescott and Baxter-King methods, and then the structural break procedure, which is widely used in the literature, is applied to detect hysteresis. The presence of a structural break supports the existence of hysteresis in the output gap. In addition, a structural VAR model is estimated with money supply, capacity utilization rate, and capital productivity variables as components of the output gap. While the empirical evidence points to the role of capacity utilization and productivity variables in explaining hysteresis, capacity utilization shocks are relatively stronger determinants of output gap hysteresis. For future studies, the effect of money supply on capacity utilization and productivity, labor productivity, etc., should be monitored. The novelty of the study is the modeling of hysteresis in a structure that includes demand-side and supply-side components. This innovation allows it to act as a guide for policymaking by taking into account the dynamic conditions appropriate to the nature of hysteresis beyond the static situation, such as the detection of hysteresis in the literature.https://dergipark.org.tr/tr/download/article-file/4327664output gaphysteresisstructural breakstructural varçıktı açığıhisterezisyapısal kırılmayapısal var |
| spellingShingle | Harun Bal Neşe Algan Koray Yıldırım The Dynamics of Output Gap Hysteresis in Türkiye Ekonomi, Politika & Finans Araştırmaları Dergisi output gap hysteresis structural break structural var çıktı açığı histerezis yapısal kırılma yapısal var |
| title | The Dynamics of Output Gap Hysteresis in Türkiye |
| title_full | The Dynamics of Output Gap Hysteresis in Türkiye |
| title_fullStr | The Dynamics of Output Gap Hysteresis in Türkiye |
| title_full_unstemmed | The Dynamics of Output Gap Hysteresis in Türkiye |
| title_short | The Dynamics of Output Gap Hysteresis in Türkiye |
| title_sort | dynamics of output gap hysteresis in turkiye |
| topic | output gap hysteresis structural break structural var çıktı açığı histerezis yapısal kırılma yapısal var |
| url | https://dergipark.org.tr/tr/download/article-file/4327664 |
| work_keys_str_mv | AT harunbal thedynamicsofoutputgaphysteresisinturkiye AT nesealgan thedynamicsofoutputgaphysteresisinturkiye AT korayyıldırım thedynamicsofoutputgaphysteresisinturkiye AT harunbal dynamicsofoutputgaphysteresisinturkiye AT nesealgan dynamicsofoutputgaphysteresisinturkiye AT korayyıldırım dynamicsofoutputgaphysteresisinturkiye |