Financial Development and Economic Growth: A Causality Analysis for Turkey.

The causality relationship between financial development and economic growth is one of the highly discussed and unresolved topics in the economics literature. In this study, the causality relationship between financial development and economic growth is searched for Turkey. Quarterly data of 1990:I-2011:IV period are used in this study. As a result of the analysis, it is found out that there is a positive undirectional causality running from financial development to economic growth in Turkey. This result shows that supply leading hypothesis on the literature of financial development-economic growth relationship has been valid through the last 22 years period in Turkey.