Fiscal risks in public finance and macroeconomic effects; Turkiah case

In this study I tried to elaborate the concept of fiscal risks in public finance. Because of this subject not being studied recently I had to cope with many difficulties. But, I did my best to put forward all about the fiscal risk. Although the concept of fiscal risk is generally known and used in the private sector it has different meaning in terms of public finance. Fiscal risks of public finance are ?the sources of financial stress that the government might face in the future?. At this point of view the government activities, natural disasters and economic crises that cause financial stress and fiscal liabilities can be called fiscal risks. Fiscal risks can?t be totally removed but they can be managed. To provide fiscal discipline in public finance is the most effective way in managing the risks. Fiscal transparency is another effective way to struggle the fiscal risks. Fiscal transparency provides information about the government activities and helps to prevent the off-budget transactions. I tried to crystallize the fiscal risk matrix of Turkish public finance and elaborate the types of fiscal risks. In this study, economic results of fiscal risks are econometrically analyzed. As a result it is found that there is strong relation between the fiscal risks and the budget deficit, inflation rate, interest rate and public sector borrowing requirement.