1887

OECD Economics Department Working Papers

Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.

The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.

English, French

After the Crisis

Mitigating Risks of Macroeconomic Instability in Turkey

Turkey is recovering from a severe recession. Once growth gains full speed, the authorities will likely face the challenge of widening external imbalances and of ensuring a smooth functioning of the financial markets. The former will require improving competitiveness, raising domestic saving, attracting more FDI inflows and reducing energy import dependency. Improvements in many of these areas will depend on structural reforms in the labour and product markets. Financial market stability calls for adopting international standards of prudential regulations and reacting pre-emptively to new developments in the financial markets. Mitigating risks of macroeconomic instability will be crucial for embarking on a stable and strong growth path to generate sustainable convergence with the OECD average income level. This paper relates to the 2010 OECD Economic Review of Turkey (www.oecd.org/eco/surveys/turkey).

English

Keywords: Turkey, financial supervision, competitiveness, saving, energy import dependence, trade model, current account deficit, FDI
JEL: H3: Public Economics / Fiscal Policies and Behavior of Economic Agents; Q43: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Energy / Energy and the Macroeconomy; G18: Financial Economics / General Financial Markets / General Financial Markets: Government Policy and Regulation; F32: International Economics / International Finance / Current Account Adjustment; Short-term Capital Movements; F41: International Economics / Macroeconomic Aspects of International Trade and Finance / Open Economy Macroeconomics; E21: Macroeconomics and Monetary Economics / Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy / Macroeconomics: Consumption; Saving; Wealth; C5: Mathematical and Quantitative Methods / Econometric Modeling
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