A study on the macroeconomic effects of natural disasters in Turkey

In this study, it is empirically analysed whether there is a relationship between the cost of natural disasters occurring between 1974-2023 and the Gross Domestic Product of the country. Auto-Regressive Distributed Lag, ARDL cointegration model was used to determine this relationship. Natural disaster cost, Gross Domestic Product, Current Account Deficit, Foreign Direct Investment, Domestic Investment data sets were used in the ARDL cointegration analysis. As a result of the analysis, it was determined that there is a relationship between natural disaster cost and GDP in the long run. As a result of the analysis, it was concluded that there is cointegration between the variables at 10% significance level in the long run. The cost of natural disasters positively affects GDP. As a result of the estimation, it is determined that there is a negative relationship between current account deficit and GDP. On the other hand, there is a positive relationship between domestic investment and GDP. As a result of the shortrun estimation, it is seen that the cost of natural disasters negatively affects GDP and this situation reaches the long-run equilibrium within approximately one year and ten months. According to this study, the costs incurred after natural disasters positively affect the economy of the country in the long run, as they will increase domestic investments in the long run and there will be physical and technological renewal in the region where the disaster is experienced.