A novel index of macroeconomic uncertainty for Turkey based on Google-Trends

Bilgin M. H. , Demir E., Gozgor G., Karabulut G., Kaya H.

ECONOMICS LETTERS, vol.184, 2019 (Peer-Reviewed Journal) identifier identifier

  • Publication Type: Article / Article
  • Volume: 184
  • Publication Date: 2019
  • Doi Number: 10.1016/j.econlet.2019.108601
  • Journal Indexes: Social Sciences Citation Index, Scopus
  • Keywords: Search-based indices, Economic and financial uncertainty, Turkey, Google Trends


This paper aims to measure the level of economic and financial uncertainty in Turkey. The measure used is based on an internet search-based strategy and develops the 'Turkish Economic and Financial Uncertainty Index' (TEFUI). Based on the real-time monthly Google Trends data for the period from January 2004 to December 2018, our illustration suggests that TEFUI performs significantly well to predict various indicators of the Turkish economy as well as global uncertainty. To check the relative performance of the measure, we also contrast our index, which uses Turkey economy specific words and phrases, with an index generated for another country, e.g., the U.S. Based on correlation analysis and a comprehensive VAR analysis, our results suggest TEFUI successfully capture uncertainty in Turkey. (C) 2019 Elsevier B.V. All rights reserved.