Akdeniz, Coşkun2023-05-062023-05-06202197830305410889783030541071https://doi.org/10.1007/978-3-030-54108-8_9https://hdl.handle.net/20.500.11776/12034As an important indicator for the central banks that adopting inflation targeting regime, this paper aims to construct a monetary conditions index (MCI) for Turkey based on the weighted sum approach covering the period of 1986:05-2018:10. As a novelty time-varying parameter vector autoregressive (TVP-VAR) models allowing the change of index weights is used over time. The results suggest that the weights of the index components varied substantially over the analysis period and the constructed index is able to capture the crisis periods accurately. © The Authors 2021. All rights reserved.en10.1007/978-3-030-54108-8_9info:eu-repo/semantics/closedAccessMonetary conditions indexTurkish economyTVP-VARBook Chapter2152282-s2.0-85146479367