Economic effects of domestic borrowings after 1980 in Turkey

ıu ABSTRACT ECONOMIC EFFECTS OF DOMESTIC BORROWINGS AFTER 1980 IN TURKEY Gökhan SÜMER Department of Economics Anatolia University, Institue of Social Sciences, September 2002 Consultant: Doç. Dr. Rana EŞKİNAT Public needs is increasing rapidly day by day. This causes increase in goverment expenditure. Beside this finacing the expenditures has difficulties. The main finance source of goverment expenditures is taxes. Tax incomes can't cover goverment expenditures so that budget deficit is seen. In order to solve this problem goverment looks for lots of existing ways. One of the solution way is domestic borrowings. Now a days domestic borrowing is often used by many goverment. After 1980 domestic borrowing has essentially been used to finance budget deficit in Turkey. Domestic borrowing has essentially been used to finance the budget deficit. In Turkey high interest rates and short term domestic borrowing is seen. As a result of this composition domesttic borrowing has many economical and social harmfull effects. Domestic borrowing has demages esspecially on production, consuming, inflation rate, interest rate and distribution of national income. In this study we examined the effects of domestic borrowing and we analyzed structure of domestic borrowing in Turkey. Also we compared domestic borrowing in Turkey with other countries. We analyzed the social and economical effects of domestic borrowing in Turkey after 1980.