The Turkish Economy in the Period between 1990 and 2000 in the Light of the Open Economy Policies of the 1980s Developments

The structure of the economy seems to have been reshaped for the post-1980 period with the decisions of January 24,1980 and the structural changes that followed.In the 1980s,which can be called the transition process to a Free-Market Economy and an open economy,on the one hand,the privatization of state institutions and the determination of the prices of goods and services in free market conditions were tried to be ensured in order to withdraw the state from economic life,on the other hand,it was tried to grant freedom to foreign trade and capital movements.While these two main issues were being realized,the import substitution industrialization strategy was abandoned and the export-led growth model was started to be implemented.The last step of this process of opening up and liberalization was realized with the decision numbered 32 in 1989.While the change in the economic structure was achieved through domestic borrowing in the 1980s,with the liberalization of capital movements in the 1990s,it was seen that economic growth and development were tried to be achieved with hot money inflows rather than foreign direct investments.This orientation made the economy more open to crises,and for the first time there was a crisis in the form of the 1994 economic crisis,which was understood to be caused by hot money.The 1994 economic crisis could only be overcome by giving government guarantees to bank deposits and issuing high-interest Treasury Bills.Even the new banking regulations could not prevent the emergence of similar new economic crises in the following years.Because,we can say that the economic crisis experienced in the 2000s brought about a political transformation along with creating great economic problems.

Developments in the Turkish Economy During the Period Between 2000-2010 in the Light of the Free-market Economy Policies of the 1980s and 1990s

The structural changes that took place in the Turkish Economy following the January 24,1980 decisions and their aftermath.With the policies of opening up to the outside world and transition to a free market economy in the 1980s in the Turkish Economy,there were radical changes in the structure of the economy and the prices of all goods and services began to be determined by the market under market conditions.In the 1980s,which can be called the transition period to the Free Market Economy and open economy,efforts were made to privatize state institutions and determine the prices of goods and services under free market conditions in order to withdraw the state from economic life,while on the other hand,efforts were made to grant freedom to foreign trade.While these two main issues were being realized,the import substitution industrialization strategy was abandoned and the export-oriented growth model was started to be implemented.The last step of this opening up and liberalization process was realized with the decision number 32 in 1989.We can say that with the liberalization of capital movements in the 1990s,economic growth and development were tried to be achieved through hot money inflows rather than direct foreign investments.This trend made the economy more open to crises,and for the first time,a crisis occurred in the form of the 1994 economic crisis,which was understood to be caused by hot money.The 1994 economic crisis was tried to be overcome by providing state guarantees to bank deposits and applying high interest rates.Thus,it is noteworthy that high inflation was experienced in the period until the 2001 economic crisis.We can say that the financial crisis that occurred in 2001 as a result of the environment that occurred in the 1990s deepened and turned into an economic crisis,and the economic and political effects of this crisis were experienced.Although there have been many economic crises in the history of the Republic,this crisis is considered to be the most deeply effective.While the crisis was overcome with the stand by agreement made with the IMF and the announced Transition to a Strong Economy program,the economy started to grow rapidly with the ease of using foreign resources,and political stability seems to have enabled this economic growth process to continue uninterruptedly except 2009.There was also a decrease in inflation rates.

Developments in the Turkish Economy Between 2010-2020 in Light of Monetary Policy in the 2000s

In the Turkish Economy,there were radical changes in the structure of the economy with the policies of opening up to the outside world and transition to a free market economy in the 1980s,and the last step of this opening up and liberalization process was realized with the decision number 32 in 1989.We can say that with the liberalization of capital movements in the 1990s,economic growth and development were tried to be achieved through hot money inflows rather than direct foreign investments.This trend made the economy more open to crises,and for the first time,a crisis occurred in the form of the 1994 economic crisis,which was understood to be caused by hot money.The same economic structure experienced a financial and economic crisis caused by hot money again in November 2000 and February 2001.While the crisis was overcome with the stand-by agreement made with the IMF(International Monetary Fund)and the announced Transition to a Strong Economy program,the economy started to grow rapidly with the ease of using foreign resources,and political stability seems to have enabled this economic growth process to continue uninterruptedly except 2009.There was also a decrease in inflation rates.The same economic structure continued in the period between 2010 and 2020,and the financing need of economic growth was met by outsourcing.However,this process was different from the previous decade and there was no economic and financial crisis other than the sudden increase in exchange rates in 2018.We can say that the sudden exchange rate increase in 2018 was perceived as a harbinger of possible exchange rate shocks in the following years.

A Study on Inflation Theories and Turkey’s Inflation Problem

In the Turkish Economy,with the policies of opening up to the outside world and transition to a free market economy in the 1980s,there have been radical changes in the structure of the economy and the prices of all goods and services have begun to be determined by the market under market conditions.In the 1980s,which can be called the transition process to a free market economy and open economy,on the one hand,efforts were made to privatize state institutions in order to withdraw the state from economic life and to ensure that the prices of goods and services were determined under free market conditions,while on the other hand,efforts were made to grant freedom to foreign trade.While these two main issues were being realized,the import substitution industrialization strategy was abandoned and an export-based growth model was started to be implemented.The last step of this opening up and liberalization process was realized with the decision numbered 32 in 1989.With the liberalization of capital movements in the 1990s,we can say that economic growth and development was attempted to be achieved through hot money inflows rather than direct foreign investments.This orientation made the economy more vulnerable to crises,and for the first time,a crisis occurred in the form of the 1994 economic crisis,which was understood to be caused by hot money.The 1994 economic crisis was attempted to be overcome by providing state guarantees for bank deposits and applying high interest rates.Thus,it is noteworthy that high inflation was experienced in the period leading up to the 2001 economic crisis.Indeed,while the increase in the wholesale price index rarely remained below 30%on an annual basis between 1980 and 1990,increases of 50%and 60%began to be seen.However,the period between 1990 and 2000 was a period in which higher inflation rates were encountered.As a result of the environment created in the 1990s,we can say that the financial crisis experienced in 2001 deepened into an economic crisis and that this crisis had economic and political effects.Although there have been many economic crises in the history of the Republic,this crisis is considered to be the most deeply effective.While the crisis was overcome with the stand-by agreement made by the IMF and the announced Transition to a Strong Economy program,the economy began to grow rapidly with the ease of use of foreign resources,and the existence of political stability seems to have ensured that this economic growth process continued uninterruptedly except for 2009.A decrease was also experienced in inflation rates.After 2015,inflation rates began to rise again,and although negative economic growth rates were experienced between the 3rd quarter of 2018 and the 3rd quarter of 2019 during the exchange rate shock period in 2018,we can say that this was not effective enough to turn annual average growth rates into negatives.The exchange rate shock experienced in November 2021 both caused changes in economic policies and the adoption of new policies,and seems to have led to an economic crisis wave caused by the large increase in inflation rates.Within this framework,a post-Keynesian policy of combating inflation has been implemented,and with the new economic policies announced in June 2023,the Central Bank has gradually increased policy interest rates and started to implement tight monetary policy in cooperation with the Ministry of Treasury and Finance,and we can say that a new phase has been entered in the post-Keynesian policy of combating inflation.However,in our opinion,it is necessary to determine well where inflation originates from and what ensures its continuation.In this context,Turkey’s inflation problem will be analyzed by utilizing the views of post-Keynesians on inflation and the profit-push inflation approach.