Turkey’s Distressing Dance with Capital Flows

Report (TEPAV) N° 201407, November 2014
The Economic Policy Research Foundation of Turkey

Fatih Özatay *

In the aftermath of the 2001 crisis Turkey took important steps towards achieving macroeconomic and financial stability. Together with favorable international financial conditions, this helped to achieve a rather high per-capita GDP growth. The high growth period failed to be sustainable, however. From 2008 to 2013, Turkey had a rather volatile and low growth. This paper aims at analyzing the underlying reasons of high volatility of growth and discussing short-term economic policy alternatives to mitigate such undesired fluctuations.

* Director , TEPAV Finance Institute.

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