Turkish Economy Research Articles

The Asymmetric Effect of Foreign Ownership and Concentration on Financial Dollarization: The Case of the Turkish Economy

The Asymmetric Effect of Foreign Ownership and Concentration on Financial Dollarization: The Case of the Turkish Economy

Socioeconomic, Migration, and Political Upheaval Factors in Crime: Applying the Social Disorganization Theory in Turkey

ABSTRACTThis review attempts to provide a comprehensive investigation of the complex argument that socioeconomic conditions and crime are related through political instabilities and their impact on Turkey's economy, with a specific focus on social disorganization theory. By focusing on the Turkish labor market, this study examines the interplay of socioeconomic factors impacting crime rates and changing public views. This review highlights social disorganization and crime patterns via socioeconomic factors, migration, and political upheaval. By exploring the transformation of Turkey's labor market over many decades, this study aims to provide insights into the ongoing issues of the country.

The Effects of Taxes on Income Distribution Justice

One of the most important economic problems that countries have faced from the past to the present is income inequality. Income distribution is an important indicator that allows us to understand the social and political structures of societies by revealing how the income gap between the rich and the poor in a country changes. Thus, income redistribution or income justice is one of the important goals of fiscal policy. Taxes are also important intervention tools that economic management has in achieving this goal. In this context, this study aims to examine the relationships between different types of taxes and income distribution in the Turkish economy during the period from 2002 to 2022 by using markov regime switching analysis method. The analysis results indicate that, during the period covered by the study, indirect taxes have a positive effect on income distribution, while taxes based on declaration have a detrimental effect on income distribution.

Developments in the Turkish Economy Between 2010-2020 in Light of Monetary Policy in the 2000s

Developments in the Turkish Economy Between 2010-2020 in Light of Monetary Policy in the 2000s

The Stability of Party Power in Turkey after President Erdogan's Victory in the 2023 Elections

The present research aims to identify the impact of Erdogan's victory on the basic budgets in Turkey and its impact on the opposition parties and the strength of the opposition, as well as on the Turkish economy, as the economic factor played a significant and influential role in the results of the Turkish elections, which led to the rise of the Justice and Development Party with Erdogan's victory. This party has an effect on the political and democratic process in the country. Thus, the investigation includes two axes: the first, political parties in Turkey, and the second, the Turkish elections in 2023 AD.

Effects of Income Distribution and Fiscal Policy on Growth in Turkey: A Kaleckian Analysis

This study examines the effects of functional income distribution and fiscal policy on growth in Turkey. A post-Kaleckian open economy model is used to analyze the Turkish economy by integrating fiscal policy tools into the econometric model, such as tax burdens on labor and capital and government expenditure for 1988–2017. The novelty of our study is that it considers the private profit motive and rollback of government activities by including public-private partnership investments in the model. Our findings suggest that government ideologies in providing services through different channels do not cause alteration in the domestic demand regime; it stays wage-led in all scenarios we applied. Yet, the overall regime turns out to be profit-led since net export is sensitive to labor costs. JEL Classification: E12, E62, L33

A Nonlinear Causality Analysis of the Relationship Between Gold Prices, Exchange Rates and Stock Market in Türkiye

With globalisation and rapidly developing technology, financial investment instruments have diversified, and investors have begun to look for ways to make the most of their investments. Consequently, the relationships between financial instruments have gained more and more importance. This study aims to determine the direction of the causality relationship between exchange rates, gold prices, and the BIST100 index by using monthly data covering the period of 2003:01-2022:06 in the Turkish economy. Diks & Panchenko’s (2006) non-linear causality test was used to determine the direction of causality, and the test shows a unidirectional causality relationship from BIST100 to exchange rates.

Exchange Rate Pass-Through into Import Prices: Evidence from Türkiye during 2010-2020 Period

This article analyses pass through of exchange rates into the import prices for an emerging economy, Türkiye, which faced severe fluctuations in the nominal exchange rate in the recent years, and experienced significant increases in domestic prices. The Turkish economy continues to struggle due to high inflationary pressures and a steep Turkish Lira (TL) devaluation particularly after 2017. This study aimed at examining the relationship between exchange rate and import prices using quarterly data for the period of 2010q1-2019q1, while the empirical methodology is framed in the multivariate cointegration analysis, along with the application of the Johansen cointegration test and the development of an autoregressive error correction vector for the determination of the pass-through in the long term. Our findings show that 85.6% of the fluctuations of the nominal exchange rate are transmitted to the import prices in the mentioned period, slower than the findings of the study by Akgunduz and his colleagues as the difference of import prices from its long-run relationship implied by the real exchange rate is likely dominated by energy prices in a strong manner. Second significant finding derives from the parameter that measures the speed of the pass-through, whose estimate has been found as -0.0125, inferring that the adjustment in short-term imbalances between import prices and the nominal exchange rate through changes in import prices is rather slow.

Nuclear topsy turvy: the security-economics nexus in Turkish-American relations

This article discusses the shift in Turkey’s nuclear alliance with the United States from client to junior partner. Ankara sought to bring the Turkish economy and military forces in line with those of its patron to signal its loyalty. But power asymmetries made it so that Washington became Ankara’s lifeline. From the 1950s until the mid-1960s, American policymakers applied a top-down style of alliance management, making important decisions without consulting Ankara. But the mid-1960s marked a turning point in the nature of this relationship, as Turkey became better able to stand on its own feet. Rather than relying on unilateral measures, the Americans had to consult and coordinate with Ankara. Also, Turkey could reject key American proposals involving nuclear weapons, such as the creation of a Multilateral Force for NATO, and even create some ambiguity about its nuclear intentions to signal its loss of faith in the American security guarantee.

The Relationship between Agricultural Production, Agricultural Exports and Economic Growth in Türkiye: Cointegration and Causality Analysis

This study aimed to assess the influence of agricultural production and agricultural product exports on economic growth within the Turkish economy. To achieve this, annual data spanning from 1980 to 2022 were utilized to construct a model, employing the ARDL Bounds Test to discern the long-term cointegration relationship among variables and the Fourier Toda-Yamamoto Causality Test to determine causality relationships. The empirical findings from the ARDL Bounds Test indicate that increases in both agricultural production and agricultural product exports positively impact economic growth. Moreover, results from the Fourier Toda-Yamamoto Causality Test unveil a two-way causal relationship between agricultural production and GDP, while a one-way causality relationship is observed between agricultural product exports and GDP. Despite the declining share of the agricultural sector in GDP over the years in Turkey, these findings underscore the enduring importance of agriculture in driving economic growth and creating value. As potential solutions to Turkey's balance of payments challenges, strategies such as boosting domestic demand, expanding the domestic market, and augmenting agricultural sector contributions to foreign exchange earnings through agricultural export subsidies are proposed. Furthermore, efforts to mitigate income disparities between the agricultural sector and other sectors could foster socio-economic development in rural areas, thus promoting a more equitable distribution of national income across society.

FORECASTING CONSUMER PRICE INDEX USING MACROECONOMIC VARIABLES: A COMPARATIVE ANALYSIS OF MACHINE LEARNING AND DEEP LEARNING APPROACHES

The Turkish economy has faced many economic difficulties throughout it's history. At this point, predicting inflation accurately is very important for policy makers, businesses, investors and consumers. This study aims to estimate the Turkish Consumer Price Index. Producer price index, M1 money supply, gold price, dollar price, natural gas price and interest rate variables were used to estimate the CPI for Turkey. The variables used in the research were obtained through EVDS, the Central Bank's Electronic Data Management System. Monthly data from January 2003 to August 2023 was used in the study. The obtained data were estimated using DDPG, XGBoost, SVR, KNN and CNN-BiLSTM methods. Model performances were compared using RMSE, MSE, MAE, MAPE and R2 statistical coefficients. When model performances were evaluated, the best CPI prediction for Turkey was obtained by the SVR method.

Promoting Lampung’s coffee to the Small Medium Enterprises (SMEs) in Turkey

Coffee producers in Indonesia need help with product quality, capital, and marketing. This international Community Service activity aims to promote Lampung coffee to the Turkish coffee market and improve the quality of Lampung coffee production and marketing. The activities were carried out in Istanbul, Turkey, with participants consisting of lecturers and students of the Master of Accounting FEB University of Lampung and management/employees of Kahvegihbikahve, one of the SME's coffee producers in Istanbul, Turkey. The activity was carried out through three main stages: (1) Preparation: situation analysis, preparation of material, making brochures for Lampung coffee producers; (2) Implementation: providing material to participants discussion to strengthen understanding and application of the material. (3) Evaluation and Reporting: comprehensive evaluation of community service results so that the participants can get to know the characteristics and taste of coffee in two countries (Indonesia, especially Lampung coffee and Turkish coffee), can understand and learn strategies for increasing the quality and quantity of coffee products and their marketing. So, it can make a positive contribution to the Indonesian and Turkish economies by increasing exports of coffee products and expanding the introduction of Indonesian coffee culture and taste.

FROM MONEY TRANSFERS TO MEAL TABLES: UNRAVELLING THE NEXUS OF REMITTANCES, FOOD SECURITY, AND ECONOMIC GROWTH IN TURKEY

The link between remittances, food security, and economic growth is a complex and important element of the economic development of the society. The study aims to explore the causality relationships between Remittances, Food Security and Economic Growth in the Turkish economy. The period of study from 1974 to 2018 and annual data of Remittances, Calories intake (as a proxy for the food security) and Economic Growth are used in the framework of time series. Techniques such as Zivot-Andrews (ZA) unit root, Toda-Yamamoto (TY), Breitung-Candelon (BCG), and Hatemi-J tests are used to detect the causality assessing the direction of it. The main findings consist of: (i) the presence of cointegration of rank two among series, the lack of linear TY time domain causality; (ii) the presence of BCG spectral causality from Calories intake to Growth only in medium period at 10% significance and, (iii) the presence of asymmetric causality from Remittances to Growth in positive changes, from Growth to Calories intake in negative changes and from Calories intake to Remittances in positive changes respectively at 1,5, and 1% significance. These results provide policymakers with valuable insights into the complexity nature of the relationship among remittances, food security, and economic growth, guiding them in designing effective strategies for poverty alleviation, sustainable development, and inclusive growth.

The Relationship between Stock Market-Based Financial Development and Economic Growth: The Case of Turkey

This study aims to examine the effect of financial development on economic growth in the case of Türkiye. Financial development is considered the one of the basic elements of economic development. It provides an important reference to better understand the relationship between financial development and economic growth in Turkey and to predict the effects of economic policies. In the study, quarterly data for the period January 1999 - January 2023 are analysed for the Turkish economy with the help of ARDL (Autoregressive Distributed Lag-ARDL) cointegration methodology. According to the results, it has been seen that the stock market index, which is an indicator of financial development, consumption and net exports has a positive effect on growth. On the other hand, investment has no effect on growth rate and government expenditure has negative effect on growth rate.

Development of earthquake early warning algorithm magnitude scale for the 2023 Kahramanmaraş earthquake region

On 6 February 2023, Türkiye suffered two major earthquakes with magnitudes of Mw = 7.7 and Mw = 7.6 at 04:17 and 13:24 local time in Pazarcık and Elbistan districts of Kahramanmaraş, which were called as the disaster of the century. On 20 February 2023 at 20:04 local time, another major earthquake with Mw = 6.4 occurred in Yayladağı, Hatay. This disaster caused great loss of life and heavy destruction. The burden of the earthquake on the Turkish economy is extremely heavy. The purpose of earthquake early warning systems (EEWS) is to protect people and property, save time for precautions to be taken and prepare emergency response teams. An effective EEWS has a major role in reducing life, structural and economic losses. This study is an implementation of the original California optimized EPIC, an early warning algorithm, in the region of the 2023 Kahramanmaraş earthquakes. A total of 212 earthquakes in the region are replayed to derive magnitude scaling equations based on peak displacement amplitude (Pd) and predominant period (Tpmax). The performance of the modified equations is tested for three large earthquakes. By comparing the magnitudes estimated by Pd and Tpmax, it is observed that Pd gives more suitable results. The 2023 Kahramanmaras earthquakes real-time tests suggested a warning time of 32 s for the first earthquake in Antakya (Hatay), where the heaviest destruction and loss of life was observed. In the other earthquakes, the warning times were interpreted as quite useful to minimize the loss of life. The geography of the 2023 Kahramanmaraş earthquakes is a seismically active region and will be subject to earthquakes in the future. As a result of this study, a region-specific scaling of the magnitude, which is the most important parameter if an early warning system is established in the region, is presented. It is also a good example of how an effective earthquake early warning system can reduce potential hazards.

Double Discrimination: Attitudes toward Syrian and Ukrainian Immigrant Entrepreneurs' Job Postings in Türkiye

This study uses a vignette experiment to examine the discriminatory attitudes towards immigrant entrepreneurs. The aim is to assess how biases based on ethnicity affect the job application intentions directed towards immigrant entrepreneurs, specifically comparing those from Syria and Ukraine with their Turkish counterparts. The research addresses several objectives: to determine whether discriminatory practices against immigrant entrepreneurs differ from those faced by immigrant workers; to explore the presence and nature of discrimination against immigrant entrepreneurs in Türkiye, including taste-based and statistical forms of discrimination; to investigate potential double discrimination between entrepreneurs of Middle Eastern (Syria) and European (Ukraine) origins; and to analyze whether ethnic cues in job advertisements influence job application intentions. Findings reveal that immigrant entrepreneurs experience significant discrimination, with Syrian entrepreneurs facing more bias compared to Ukrainians, influenced by geopolitical and cultural factors. This study offers a new perspective by examining how potential applicants respond to job advertisements from immigrant entrepreneurs, differing from previous research on discrimination faced by immigrant workers. The results highlight the need for inclusive policies and practices to support immigrant entrepreneurs and enhance their participation in the Turkish economy, contributing to a more equitable and diverse entrepreneurial landscape.

Prevalence of Cystic Echinococcosis in Cattle Slaughtered in Kastamonu Slaughterhouse and Its Importance in Turkish Economy

This study was carried out to determine the prevalence of cystic echinococcosis (CE) in cattle slaughtered in the slaughterhouse of Kastamonu Municipality, where cattle breeding is common and to determine the economic loss in the country's economy due to this disease. A total of 5511 bovine livers were examined postmortem for CE between January and December 2021. Of the 5511 cattle, 3872 are male and 1639 are female. In the postmortem examination, the livers of the animals were examined and the number of animals with CE was calculated to be 524 and the preva-lence of the disease was 9.51%. In animals, the highest monthly prevalence was observed in July with 14.85% and the lowest prevalence in December with 3.94%. CE was the lowest with 4.94% in winter and the highest with 13.68% in summer. CE was found to be the lowest in male animals with 4.44% in winter and the highest prevalence in summer with 12.70%. The prevalence of the disease in female animals was 6.79% in winter and 21.32% in summer. Livers with CE were destroyed regardless of infection intensity. As a result of this study, with the destruction of 524 livers, 136240 TL (13859 USD) was lost to the Turkish economy. It has been stated that CE is common in Kastamonu as in Turkey and causes great economic losses.

ABD Merkez Bankası'nın Para Politikası Kurallarından Sapmaları ve Bunların Yayılma Etkileri

The aim of this study is to examine the impact of the FED's deviations from monetary policy rules on the Turkish economy. In other words, the spillover effect of the FED's monetary policy was examined. The dataset used in the study was divided into two parts as rule-based and discretionary periods with reference to Taylor (2012), and the interaction between the variables was examined using structural VAR models. The results show that deviations from monetary policy rules have quite significant effects on the Turkish economy in the period when the FED is closer to discretionary policy. Considering that the economies of developing countries such as Turkey are more affected by the monetary policies of the FED than the developed countries, it can be said that transparent and predictable monetary policies are an effective tool to be protected from these global effects. In addition, the diversification of the foreign trade portfolio and the strengthening of foreign exchange reserves are also extremely important in making the Turkish economy resilient to the shocks resulting from the FED's monetary policies.

Turkish textile and clothing SMEs: Importance of organizational learning, digitalization, and internationalization

Abstract The Turkish textile and clothing (TTC) industries, which are mainly made of small and medium enterprises (SMEs), are the main source of export for the Turkish economy since the end of 1980s. The introduction of digital technologies has changed the competition for the TTC industries and this change has been accelerated after the covid-19 pandemic. Digitalization of SMEs is accepted as a social and technical process in which organizational learning is the main actor and therefore, the aim of this research is to explore the relation between organizational learning, digitalization, and internationalization for TTC industries. A parallel-results convergent mixed method approach in which qualitative and quantitave analysis are performed seperately and integrated later is applied in this research. The data of the research were collected by semi-structured interviews and survey questionnaires, which are analyzed in MAXQDA and analysis of moment structures.

Political economy of Turkey’s pivot to Asia

ABSTRACT This article examines Türkiye’s increasingly complex relations with Asia from a political economy perspective, capitalizing on the notions of semi-periphery and sub-imperialism in an era marked by the crisis of globalization and a relative decline of US economic and technological power. It contends that the complexity of Türkiye-Asia relations and associated changes in Turkish foreign policy should be examined within the shifting global and domestic political-economic conditions and the changing relations between countries.