Provincial economic growth in Turkey: Cross-section analyses

Abstract

In this paper, which aims at determining the dynamics of provincial economic growth in Turkey, cross-section analyses are conducted on a model based on internal growth theory for 72 cities for which sufficient data set is available for the period 1991-2000. Regression estimate results, considering all provinces, indicate that the factors affecting provincial growth are geographical position (positively), degree of openness (positively), investment incentives (positively), population growth rate (negatively) and initial income level (negatively). Furthermore, the provinces are categorized in two homogenous subgroups as developed and less developed according to the industrial development index of the provinces and same analyses are applied to these subgroups as well. It is observed that the initial per capita income level give results on the provincial economic growth as similar to those in the first analysis, but the effects of investment incentives, exports, human capital and infrastructure variables differentiate for both subgroups.