Analysis of sources of economic growth in Turkey

This study analysis the sources of growth in Turkey between 1980-2007 period by supply and demand side in the economy. After the first section, in which factors of growth are determined and explained within the context of theorethical relations, it is started to analysed the sources of growth.In the second part of the study, independent from the supply side of the economy, the sources of growth are analized within the context of approaches which mention the demand side. With the help of input-output tables and decomposition analysis the sources of growth are separated to for reasonal factors. These factors are the growth of final domestic demand, the growth of export, import substitution and technological change. The basic data sources for the first section in the study are input-output tables which are prepared for 1985, 1990, 1998 and 2002 years for Turkish economy. Input-output tables are aggrigated to 23 sectors and all of the tables are transformed to 1985 fixed prices. In order to sustain the study in a real base, double deflation method is used implated. In order to see clearly the effects of different economy policies between the periods, analysis are done by determining three subperiods which are 1985-1990, 1990-1998 and 1998-2002.The findings of the study indicates that in all subperiods between 1985-2002 years growth in Turkey depends on to increase of final domestic demand. In the last years the positive effect of the increase of final domestic demand decreases but in the growth period the relative importance between other factors still continues. In addition to this development it is proved that throughout the period the contribution of export, import substitution and technology to growth is unstable.In the last part of the study the sources of economic growth is tried to analyse from supply side. In this approach, which is also expressed as a traditional approach, the contribution of production factors and total factor productivity to the growth is studied by extensive growth accountancy approach and cointegration analyises for 1985-2007 period. The findings of the study show that the most important. factors of growth are capital accumulation and total factor productivity. But because of economic, politicial and instructural changes the increase of total factor productivity shows some changes in a time. In addition to labour and human capital accumulation plays a stable but a little role.Key Words: Sources of Growth, Input-Output Analysis, Decomposition Analysis, Growth Accounting, Total Factor Productivity