Productivity and Growth in an Unstable Emerging Market Economy: The Case of Turkey, 1960-2004

This paper explores sources of growth in the Turkish economy by performing growth accounting exercises over the 1960-2004 period and relevant subperiods. It also analyzes the role of a number of important policy-related factors, such as infrastructure investment, macroeconomic instability, and impor...

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Bibliographic Details
Published in:Emerging markets finance & trade 2009-09, Vol.45 (5), p.4-18
Main Authors: Ismihan, Mustafa, Metin-Ozcan, Kivilcim
Format: Article
Language:English
Subjects:
Capital accumulation
cointegration
Cointegration analysis
Economic growth
Economic growth rate
Economic theory
Emerging markets
Gross national product
Growth accounting
impulse response analysis
Inflation rates
Infrastructure investments
macroeconomic instability
Macroeconomics
Productivity
Public investments
Studies
total factor productivity
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Summary:This paper explores sources of growth in the Turkish economy by performing growth accounting exercises over the 1960-2004 period and relevant subperiods. It also analyzes the role of a number of important policy-related factors, such as infrastructure investment, macroeconomic instability, and imports, on total factor productivity (TFP) by performing cointegration and impulse response analyses. The results suggest that both TFP and capital accumulation were crucial sources of growth during the sample period. Nevertheless, TFP growth displayed enormous variation from 1960 to 2004. The descriptive and empirical evidence suggests that TFP is positively affected by imports and public infrastructure investment and negatively affected by macroeconomic instability.
ISSN:1540-496X
1558-0938
DOI:10.2753/REE1540-496X450501