The impact of game between state and market to real GDP growth

In this study, interaction of variables adopted as an indicator of economic policies with Istanbul Stock Exchange (ISE) 100 index which effect to real growth is investigated at Turkey’s economy. In this context, the state s economic policy instruments and the stock market price index are discussed. Money supply, tax revenue, government expenditure and interest rate are indicators of the state s fiscal and monetary policy are evaluated as the state s strategies. As market strategies; the increase of price index, the constant position (+/-3%) and a decrease in the price index is determined. In this study, optimum real growth is targeted between government and market, which are two actors of the game. The gain matrix is formed according to game theory within 2006Q2-2012Q4 period as the percentage change of quarterly data.