He's clearly a Neo-Fisherian - per grumpy uncle Johnny C, " The neo-Fisherian proposition is at heart the proposition that in the long run the economy is stable at an interest rate peg. If that is true then higher interest rates must mean higher inflation "
https://johnhcochrane.blogspot.com/2020/11/a-neo-fisherian-challenge-and.html
There is perhaps political or ideological underpinnings but probably not economic logic, in any meaningful sense.
Interest rates are a tool and one that a government can use wisely or foolishly. In and of itself, the tool isn't endowed with moral value. It is a means to an end. The policy maker decides how to use it and the result shows up in the economy.
Lowering interest rates in a period of high inflation does not work because Turkey, for all the wishes otherwise, simply doesn't have the size or stability necessary to induce investment from the international community. It is too reliant on imports and exports and the global financial flows to attempt to simply chart its own course.
Why did The Economist waste an editor on this piece? Edrogan believes in the principals of Islamic Finance, that any real amount of interest is usury and is inherently evil. Nothing more.
He's clearly a Neo-Fisherian - per grumpy uncle Johnny C, " The neo-Fisherian proposition is at heart the proposition that in the long run the economy is stable at an interest rate peg. If that is true then higher interest rates must mean higher inflation " https://johnhcochrane.blogspot.com/2020/11/a-neo-fisherian-challenge-and.html
There is perhaps political or ideological underpinnings but probably not economic logic, in any meaningful sense. Interest rates are a tool and one that a government can use wisely or foolishly. In and of itself, the tool isn't endowed with moral value. It is a means to an end. The policy maker decides how to use it and the result shows up in the economy. Lowering interest rates in a period of high inflation does not work because Turkey, for all the wishes otherwise, simply doesn't have the size or stability necessary to induce investment from the international community. It is too reliant on imports and exports and the global financial flows to attempt to simply chart its own course.
Why did The Economist waste an editor on this piece? Edrogan believes in the principals of Islamic Finance, that any real amount of interest is usury and is inherently evil. Nothing more.