This study examines the impact of economic freedom on financial development in the Turkic Republics—Azerbaijan, Kyrgyzstan, Kazakhstan, Tajikistan, Turkey, Turkmenistan, and Uzbekistan—during the 2000–2024 period. Economic freedom is defined by free market conditions and the protection of property rights, while financial development is associated with the efficient functioning of banking and capital markets. Utilizing the Economic Freedom Index by the Heritage Foundation and the Financial Development Index (FDI), the analysis employs Panel VAR and Granger causality tests. The results indicate that components of economic freedom, such as the rule of law, government expenditures, and regulatory efficiency, significantly influence financial development. The findings highlight the necessity of strengthening legal frameworks and regulatory structures to enhance investor confidence and financial stability. This study underscores the critical role of economic freedom in the development of financial markets.
PanelAnalysis, Turkish Republics, Granger Test