An Analysis on the Effectiveness of Stock Prices Channel of Transmission Mechanism

The effectiveness of monetary policy after the crisis has become an increasingly important issues in dealing with the crisis as well as achieving macroeconomic stability. monetary transmission mechanism refers to the process of monetary policy of central bank affecting output and inflation. although monetary transmission mechanism constitutes many channels the subject of our study is stock prices channel. in this study the effectiveness of the stock price channel of monetary transmission mechanism in turkey was investigated since 2002 when central bank has implemented implicit inflation targeting until the second quarter of 2014. as a result of the study, it is concluded that stock prices channel does not operate effectively in the relevant period.