Panel data application within the scope of regional (in)equality: The case of NUTS-2 regions in Turkey

Regional inequalities have continued to be an important economic problem throughout human history since primitive societies. Income, which is widely used to explain economic inequalities and is accepted as an indicator of welfare, is not distributed equally among the regions of countries as it is in all countries. These inequalities in income distribution lead to various socio-economic problems and are a critical problem for development economics. Fair distribution of income between regions is one of the important development objectives of countries. In this context, it is very important to determine the macroeconomic factors that cause income inequalities between regions in order to ensure an effective development. This study has been prepared to determine the macroeconomic factors that cause income inequality in level-2 regions in Turkey between 2014-2022. In the study, income per capita was selected as the dependent variable and independent variables were selected as gini, employment rate, inflation rate, industry, agriculture, services, public expenditure and poverty rate. Then, panel data analysis was applied using Stata 18 package programme. According to the results of the research, the macroeconomic factors affecting per capita income in the level-2 regions in Turkey between 2014-2022 were found to be gini, employment rate, inflation rate, sectoral distribution of GDP (Gross Domestic Product) at current prices according to branches of economic activity (agriculture, services and industry) and public expenditure.