Economic impacts of Turkish defense industry and modelling the relationship between defense expenditures and economic growth ecometrically

iiABSTRACTECONOMIC IMPACTS OF TURKISH DEFENSE INDUSTRY ANDMODELLING THE RELATIONSHIP BETWEEN DEFENSE EXPENDITURESAND ECONOMIC GROWTH ECOMETRICALLYHünkar Karahan TÜRKM.A.Thesis, Department of EconomicsSupervisor: Asst.Prof.Dr.Fikret DÜLGERMarch 2007, 92 pagesIn the literature of economics, one of the most contraversial issues is that ifdefense expenditure has an impact on economic growth and-if it is so- what thetendency of this impact is.As a consequence of surveys, it is argued that defense expenditure?s impact oneconomic growth cannot be standardized. It is also underlined that there would bedifferences which takes root from structural peculiarites in different countries. Movingfrom this argument, this thesis aims to investigate what the impact of defenseexpenditures on economic growth in Turkey is. In doing so, this study takes a conciselook at defense expenditures, world defense expenditures, general outlook of thedefense expenditures and its financial resources in Turkey. On this axis, defenseindustry in Turkey and its economic impacts are examined. This study also evaluates thedifferent approaches and explanatory models which are put forward concerning therelationship between defense expenditures and economic growth. Lastly, aneconometrical model which is constructed by author is presented and, then, the resultswhich are derived from this econometrical model are interpreted.Key words: Defense, defense expenditure, defense industry, economic growth.