Abstract
ABSTRACTThis paper proposes an alternative approach for analyzing the impacts of economic crises on consumption demand patterns in the absence of household consumption or price data. To do so, an Almost Ideal Demand System (AIDS) which incorporates time dummies corresponding to the periods of economic crises is estimated by using Turkish household final consumption data derived from national accounts. All findings are plausible and coherent with the theoretical framework and show that the crises significantly affect consumption demand patterns in Turkey. The study also reveals tax cuts of 2009 were designed on the basis of economic efficiency, although they were shown to be regressive by Albayrak ([2011. “Finansal Krizde Uygulanan Vergi Politikalarının Gelir Dağilimi Etkileri: 2004-2009.” Ankara Üniversitesi SBF Dergisi 66 (2): 001–034).
Highlights
Turkey experienced two heavy economic crises between 2000 and 2015
An Almost Ideal Demand System (AIDS) which incorporates time dummies corresponding to the periods of economic crises is estimated by using Turkish household final consumption data derived from national accounts
Considering the role of the economic crisis on consumption patterns, finding an insignificant crisis dummy for culture, clothing and tourism could indicate that these expenditures are likely to depend on household characteristics like income, age, education, living in urban or rural areas
Summary
Turkey experienced two heavy economic crises between 2000 and 2015. The first one started in 2001 – see Akyüz and Boratav (2003), and the following one took place between 2008 and 2009. Due to the lack of adequate data for carrying out detailed analyses, almost all the research mainly tried to reveal food demand structure in Turkey These studies aimed to map the demand of households for the meat and dairy products in response to price changes as presented in Koç and Tan (2001). Aktuna-Gunes, Gardes, and Starzec (2014) estimated another AIDS model for Turkey considering the informal economy, by using HBS data with author built-up price index Apart from these three studies, there is no demand system estimation with the current dataset that reveals long-run elasticity figures, so the paper fills an important gap in the literature. Results from this study may be relevant beyond Turkey
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
