Turkey's Twin Deficits Linked to Domestic Investments, Impacting Long-Run Current Account
The study looked at how Turkey's budget deficits, domestic investments, and current account deficits are related from 1987 to 2004. They found that there is a long-term connection between these factors, showing that Turkey relies on its own investments rather than external funds. The research also showed that there is no direct cause-and-effect relationship between budget deficits and current account deficits. In the long run, domestic investments are the main reason for Turkey's current deficits. This suggests that Turkey is not heavily reliant on foreign investments to fund its projects.