This study aims to contribute monetary economics by studying monetary transmission channels in Turkey, an economy experiencing rapid structural change, rendering structural models very fragile. A case is made using VAR techniques to measure monetary policy and reaction to it of other economic variables. One of the findings of my empirical work is the existence of ''prize puzzle'', i.e, inflation rises in response to an increase in interest rates. A possible explanation for the persistent ''prize puzzle'' is what we termed as ''cost effect''. Another possible explanation is so called ''omitted variable'' argument. A second finding of my empirical work is that monetary aggregates perform better than interest rate measures in the framework of VAR. Among monetary aggregates, narrow measures of monetary policy perform better than the larger measures. A third finding of my empirical work is that in second sub-period covered, the interest rates become more sensitive to inflation when compared to the sub-period. However, the increased sensitivity of interest rates does not lessen the reactionary character of monetary aggregates in response to inflation.