Saving-investment imbalances and triple deficit problem in Turkey

The Triple Deficit Hypothesis is an extension of the twin deficit hypothesis that state the positive relation between current account deficit and budget deficit. The triple deficit phenomenon is occurred if the domestic private savings are inadequate to finance the domestic investment in a country which the budget balance and the current account balance both are in deficit.The Triple Deficit Hypothesis explains the interaction between budget deficit, saving-investment deficit and current account deficit. Although the surplus of budget balances of many developed countries in recent years, the current account deficit has persisted it?s rise in an opposite direction. The opposite manner of these two balances have made the twin deficit hypothesis questionable. Loosing it?s importance on the formation of current account balance deficit, the budget deficit has been yield it?s place to saving-investment balance.The aim of this paper is to show the role of saving-investment deficit in the formation of current account deficit and to investigate the triple deficit phenomenon which implies the joint deficit of tree balances of economy.In the thesis, first of all, the tree main balance; ?current account balance?, ?budget balance? and ?saving-investment balance? concepts have been studied. Afterwards, recent changes in saving-investment balance in worldwide and the impact of these changes on current account balance have been tried to explain. And finally, some information has been given about the saving-investment imbalances and the emergence of triple deficit situation in Turkey.