Impact of socio-economic factors on growth in Turkey

Economical and social sides of development are complementary thateconomic sides are related to increasing income and the social sides arerelated to socio-cultural change. The unequal distribution of economical andsocial factors that guide the development process with a dynamic structure inTurkey can be accepted as the reason of interregional differentiation indevelopment levels. In this study, it is mentioned that occurrence of not onlythe sustainable growth but also the occurrence of horizontal growth isimportant. According to the Neoclassic Growth Theory, if the developmentcauses a decrease in interregional income diversity the ?convergency?, in theopposite situation the ?divergency? is valid. The hypothesis of NeoclassicTheory assumed that steady state levels are same in different economies, forthis reason convergence is defined as absolute. On the other hand, even ifthe estimation of different steady state levels depends on conditions,convergence is conditional.This thesis constitutes of three major parts. In the first chapter,considering the Solow Model, the significance of model?s explaining thegrowth and development in terms of its hypothesis, functioning, and resultsare analyzed in detail. In the second chapter, the convergence hypothesisassuming that relatively poor countries/regions develop faster thandeveloped ones and in time levels of its personal income converges to theamount of personal income in developed countries/regions; transitionaldynamic that is the fundamental of convergence hypothesis; and its types b -convergence and s -convergence concepts are examined in detail. At theend of this chapter, the empirical studies that were held in the subject ofconvergence hypothesis both in Turkey and other countries are discussed. Inthe last and third chapter of the thesis work, the significance of convergencehypothesis between the cities of Turkey while considering the effects ofselected socio-economical factors on the convergence are tested empirically.Absolute convergency analysis points out that, in the period of 1990-2001, 67 cities approximately converge to each other annually with apercentage of 0.7. For the period between 1990 and 1995, a significantconvergency can not be detected, however for the period 1995-2001 anannual convergency approximately with a percentage of 1.8 was found. Inthis frame, it is decided that the major reason of the low convergency in1990-2001 period was the strong that realized in the secondconvergencyperiod. In the direction of this thesis aims, restricted convergence analysis isimplemented within the base of 67 cities of Turkey, by deciding the severalsocio-economical factors that are thought to be influential on theconvergence between those cities. By the aid of variables that are used inthis thesis it is found that, as an indicator of demographic variables;population growth and net migration rate, as an indicator of employment; theproportion of number of workers in brunch of industry to the wholeemployment and unemployment rate; as an indicator of economic; addedvalue of service sector per person, public investment expenditures perperson, import per person, export per person and budget income per person,as an indicator of health; population per doctor are contributing to theconvergence between the provinces.In this thesis, in Turkey by analyzing the affects of socio economicfactors on growth, it is aimed to find whether the above mentioned factors arecontributing to the realization of horizontal growth.