The Determinants of the Domestic Original Sin: The Robust Regression Analysis for Turkish Economy

Abstract

The purpose of this study is to investigate the determinants of the Domestic Original Sin in Turkey from 2003: 01 to 2012: 12 by employing the Robust Regression Analysis. The result of the Robust Regression Analysis points out that exchange rate, inflation rate and foreign debt stock have a negative effect on the Domestic Original Sin while interest rate, international reserves and credit volume have a positive effect on the Domestic Original Sin. It is also determined that credit ratings and tax revenues collected by the government sector do not play an important role on the Domestic Original Sin.