The goal of this research is to determine whether the causal relationship betweenfinancial development and economic growth in Turkey is stable over time. For thispurpose, causal relationship between financial development and economic growthin Turkey has been investigated by means of annual data for the period of 1960-2013. Differently from previous studies in the literature, considering that causalrelationship between financial development and economic growth might changedepending on time, time-varying causality test developed by Balcilar, Ozdemir andArslanturk (2010) has been used. The results show that there is a unidirectionalcausal relationship from financial development to economic growth and thisrelationship changes depending on time. It is seen that unidirectional causalityfrom financial development to economic growth emerged during the periods offinancial turmoil and political crisis. The basic conclusion is that there is no stablecausal relationship between financial development and economic growth in Turkeyover the given time period.
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