The Effects of Oil Price on Turkish Economic Growth

Although the oil price is determined by demand and supply, it is also affected by lots of variables such as economic, political and technical conditions. On the other hand, fluctuations in oil price have also effect on macroeconomic stability. Oil price has an important role in Turkey, since Turkey is a country that has external dependency in energy sources. The purpose of this paper is to examine the effects of oil prices on Turkish economic growth. In this respect, the relationship between variables will be analyzed by using annual data between the years 1980-2013. For analyzing variables, it will be used Johansen Cointegration Test, Impulse-Response Function, and Variance Decomposition tests.