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The response of private investment to structural adjustment—a case study of Turkey

✍ Scribed by Öner Günçavdi; Michael Bleaney; Andrew McKay


Publisher
John Wiley and Sons
Year
1999
Tongue
English
Weight
162 KB
Volume
11
Category
Article
ISSN
0954-1748

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✦ Synopsis


Much concern has been expressed about the apparently adverse response of private investment to structural adjustment and other economic reform programmes, even in countries where these reforms appear to have been fairly successful according to other criteria. This issue is examined for the case of Turkey, where private investment dipped signi®cantly following the launch of the economic reform programme. Particular attention is paid to the ®nancial sector reforms in that programme. While the high interest rates which were associated with ®nancial liberalization did discourage investment, this eect appears to have been temporary, and ®nancial liberalisation had the bene®cial long-term eect of relaxing credit constraints on investment, which had been an important feature of the pre-reform era.


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