Inflationary Periods and the Communication Problem of Fiscal Authorities
Chapter from the book: Ayyıldız, Y. & Demirli, Y. & Şahin, S. (eds.) 2024. Inflation and Public Finance (Theory-Policy-Practice).

Neslihan Burgaz
Ankara Hacı Bayram Veli University

Synopsis

During inflationary periods, the successful implementation of fiscal policies requires not only economic tools but also an effective communication strategy. High inflation increases economic uncertainties, complicating decision-making processes for market actors and the public. In such an environment, clear and transparent communication by fiscal authorities is a critical tool for building trust, managing expectations, and ensuring economic stability. By openly announcing their decisions, governments and central banks enable market participants to make accurate predictions about future economic conditions, allowing markets to operate more efficiently.

In Turkey, the central bank has ensured market predictability through a successful communication strategy in its fight against inflation. However, uncertainties and shortcomings are observed in the communication strategy of fiscal authorities. Insufficient explanations regarding fiscal policies such as wage adjustments and pricing, as well as the ambiguity surrounding these rates, hinder the management of expectations for both the public and market actors. The inadequacy of the financial authority's communication strategy creates difficulties in making economic decisions and ensuring trust.

How to cite this book

Burgaz, N. (2024). Inflationary Periods and the Communication Problem of Fiscal Authorities. In: Ayyıldız, Y. & Demirli, Y. & Şahin, S. (eds.), Inflation and Public Finance (Theory-Policy-Practice). Özgür Publications. DOI: https://doi.org/10.58830/ozgur.pub562.c2265

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Published

December 19, 2024

DOI