By Onur Ant
Bloomberg - Jun 30, 2014
Your economics textbook got it all wrong. At least that’s what Prime Minister Recep Tayyip Erdogan says. The Turkish leader, 60, is emerging as a global pioneer of putting an untested theory of economics into action. While central bankers around the world, including Turkey’s, have made interest rate decisions based on the textbook assumption that higher rates will work to slow inflation, Erdogan and his administration argue the opposite. “High interest rates are not the result of a high inflation rate, they’re its cause,” Yasin Aktay, head of the foreign relations committee of Erdogan’s ruling Justice and Development Party, or AKP, said by phone from Ankara on June 7. “The premier is talking about the relationship between the two based on scientific facts,” he said, without explaining how Erdogan reached that conclusion.