The Impact of Budget Revenue and Expenditure Forecasting Errors on Inflation in Turkey: An Analysis of the 1975-2021 Period

Authors : Berat Kara

Pages : 19-28

Doi:10.52693/jsas.1417919

View : 62 | Download : 56

Publication Date : 2024-06-30

Article Type : Research Paper

Abstract :The forecasts embedded in the state budget both influence and are influenced by economic indicators. The divergence of budget forecasts from reality or the occurrence of inaccuracies due to various reasons significantly affects specific economic indicators. In the majority of cases, inaccurate forecasts lead to deviations in certain economic indicators. This study addresses this issue within the context of Turkey for the period 1975-2021. Budget forecasts in Turkey often yield inaccurate results. The Prais-Winsten regression method is employed to analyze whether errors in revenue and expenditure have any impact on inflation. The analysis reveals that expenditure errors have an inflationary impact. While there are studies in the literature examining the impact of inflation on forecasting errors, there is a notable gap in research focusing on the reverse scenario. This study aims to fill this gap and contribute significantly to the existing literature.
Keywords : Gelir tahmin hatası, Harcama tahmin hatası, Enflasyon, Türkiye, Prais Winsten