The shift-share analysis of investment incentives in regional development

Regional disparities has been important subject in the public finance literature and economic development since long term. The fundamental problem is that regional disparities affect economic development negatively by leading to socio-economic problems. Incentive is one of the efficient instruments among policies carried out towards reducing regional disparities. Moreover, subjecting to political effects puts incentives on the agenda. Common results obtained from the studies in this field convey that regions do not take enough share from investment incentives.The aim of this study is to examine the efficiency of investment incentives with the shift-share analysis by changing system in the period of 2008-2010. In this context, incentives at the provincial and regional level are examined on sectoral basis. In the framework of regional development, it can be said that a sufficient and efficient incentive policy has not been carried out in least developed regions.