Government vs. economic theory

Mehmet Simsek, the finance minister of Turkey, said  the rate hike, from 4,5 to 10 percent, will have a limited effect on growth of the Turkish economy. And Erdogan opposed the hike with the argument that high interest rates results in high inflation, which is contrary to all economic theory and even common sense. Does any one in the government know anything about economics?

Government vs. economic theory

an old inflated Turkish lira bill

 

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