Assessing domestic debt sustainability of Turkey with a risk management approach

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2006

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Tiftik, Mehmet Emre

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This thesis analyzes the debt dynamics of Turkey and assesses the sustainability of fisscal policy. The assessment of fiscal policy follows the methodology of Garcia and Rigobon (2004). This approach focuses on the concept of debt sustainability from a risk management perspective and incorporates the effects of stochastic shocks to the economy in its assessment. The results suggest that a continuation of the present fiscal stances will lead to a fiscal unsustainability in Turkey. Furthermore, the results indicate that the properties of the debt dynamics are closely related to the spreads on both dollar denominated debt and YTL denominated debt. This thesis also provides an application of two traditional methodologies, such as Wilcox's (1989) methodology and Uctum and Wicken's (2000) methodology in order to assess the fiscal sustainability of Turkey.

Subject Keywords

Finance, Public

URI

http://etd.lib.metu.edu.tr/upload/3/12607632/index.pdf
https://hdl.handle.net/11511/16057

Collections

Graduate School of Social Sciences, Thesis

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Citation Formats

M. E. Tiftik, “Assessing domestic debt sustainability of Turkey with a risk management approach,” M.S. - Master of Science, Middle East Technical University, 2006.