Domestic debt-inflation relationship in Turkey in the post-1980 period

At the present time, domestic debt has become a frequently used instrument in fiscal policies. In this context, a need has emerged to point out the causes of domestic debt. Inflation is one of the most prominent reasons for domestic debt and one of the current issues of our age. Within the historical process, domestic debt and inflation have been affected by economic, political, global and extraordinary developments and different dynamics. In this study, the relationship between domestic debt and inflation is analysed at the theoretical level and in the light of economic developments. Some of the empirical studies have found that domestic debt has an increasing effect on inflation and vice versa. In addition some studies have found that domestic debt increases inflation and some other studies have found that there is a relationship between domestic debt and inflation. In this study, the relationship between domestic debt and inflation in the post-1980 period in Türkiye is analysed by interpreting it in the light of the proportional analysis method and economic developments. The evaluations made within the scope of this study supported by literature works and show that there were years when domestic debt and inflation increased together and that it is important to examine the factors affecting inflation and domestic debt. Theoretical approaches, empirical studies and economic developments reveal the existence of a relationship between domestic debt and inflation and the common conditions affecting them.