Another brick for the aggregate consumption puzzle in Turkey

Abstract

This paper analyses the bivariate comovement across consumption, and current income, aggregate price level, inflation, interest rate, total employment, urban employment and rural employment for Turkey for the period 1988:Q3-2009:Q3. Engle et al. (1993) seasonal cointegration test, Pesaran et al. (2001) ARDL cointegration test, Engle and Granger (1987) cointegration test and Johansen and Juselius (1990) cointegration test are applied. The tests give mixed results about the swings of bivariate linenar combination of the variables, so the consumption function puzzle exists when measured with different methodology. © EuroJournals Publishing, Inc. 2010.