This paper tests the bilateral price-level convergence among 52 U.S. cities at the good level. We employ a new approach which is free of problems that arise when using an arbitrary benchmark, cross-section dependence, and heterogeneity. We find quite strong evidence in favor of convergence with...

The long-run purchasing power parity (PPP) hypothesis is re-examined for Turkey and strong evidence on long-run PPP is provided by using standard multivariate cointegration techniques. It is argued that the refutation of PPP by Telatar and Kazdagli does not necessarily imply the failure of...

In this article we analyse empirically currency substitution and exchange rate pass-through in the Turkish Economy, where their ongoing presence could undermine the implementation of a successful monetary policy, especially in a flexible exchange rate regime. Even though a considerable time has...

In this paper we provide probability forecasts of key Turkish macro economic variables such as inflation and output growth. Some probabilistic forecasts of different scenarios associated to those variables are also calculated. The probability forecasts take different types of uncertainties...

Forward looking monetary policy rules are estimated for Israel and Turkey. When variable inflation targets are taken into consideration, as opposed to the fixed targets used in prior research that use data from developed countries, forward looking Taylor rules seem to provide reasonable...

In many applications common in testing for convergence the number of cross-sectional units is large and the number of time periods are few. In these situations asymptotic tests based on an omnibus null hypothesis are characterised by a number of problems. In this paper we propose a multiple...

This paper estimates the IS curve of the Turkish economy for the monthly period over 1996M1-2007M11 by using GMM. It is found that, when a structural small open economy model is used and data are constructed carefully, forward-looking IS curve works perfectly in Turkey, which is against the IS...

We analyze the effects of credit and debit cards on the currency in circulation by using GMM estimation. Instead of using the data obtained by surveys, we use monthly data obtained by an interbank institution that keeps the statistics of all credit and debit cards usage of a small open economy,...

This paper analyzes Okun's law for the states of the U.S. over the period 1978-2002. By using Geographically Weighted Regression, possible geographical interactions across the analyzed states are taken into account. There is evidence of time-varying Okun's coefficients in each state. Moreover,...

This paper investigates the relationship between the level of inflation and regional price-level convergence utilizing micro-level price data from Turkey during two clearly distinguishable periods of high and low inflation. The results indicate that higher persistence and slower convergence of...