Econometric analysis of impact of recession related to the industry sector during 2008 crisis on the economic growth: Turkey implementation (2005-2016)

The fact that industrial sector is the locomotive of the development of other sectors makes it important to know the relationship between economic growth and industrial sector. While increasing the rate of GDP in the industrial sector will accelerate economic growth, the opposite situation economic growth will slow down an deven deteriorate. Especially, to determine in what way the industrial sector has been affected in the crisis period, so important for creating a policies fort he future and decreasing the effects of possible crisis in the future. The purpose of this study is to determine the effect of economic constriction in the Turkish industrial sector in 2008 along with the global economic crisis on economic growth. For this purpose, the relationship between economic growth in Turkey and industrial production index (SUE), the hours worked in the industry (CSE), the per capital production(KBU) and industry turnover index (SCE), for which represents the industrial sector, as were investgated by VECM analysis using quartely data for 2005:Q1-2016:Q1 periods. As a result of the analysis, it is concluded that all the variables are effective on the growth in the short term. In the long run, it is seen that the variables of SUE, CSE and KBU constitute the cause of growth. According to these results, improvements in the industrial sector will have a positive impact on growth. Keywords: Turkish industrial sector, Economic Growth, 2008 global crisis, Granger causality, VECM analysis