Bolat, Su. leymanBelke, MuratAras, Ozan2024-10-262024-10-2620111300-3623https://hdl.handle.net/20.500.12418/29128This paper examines the validity of twin deficits hypothesis (the relationship between the budget deficit and the current account deficit) using the data period 1998:1-2010: 4 in Turkey. The paper that examines the short-run and long-run relationship between the budget deficit and the current account deficit uses the bounds testing approach. Our results show that there is no long-run relationship between the two deficits but there is a strong positive relationship between the two deficits in the short-run. When the budget deficit increases one percent, the current account deficit also increases 0,18 percent in the short-run. While the findings support the Keynesian approach that holds the validity of the twin deficits hypothesis in the short-run, they support the Ricardian equivalence hypothesis that rejects the twin deficits hypothesis in the long-run.trinfo:eu-repo/semantics/closedAccessTwin DeficitsRicardian Equivalence HypothesisBounds TestingArticle161364347WOS:000420266500020N/A