The effects of external debts on economic growth: The case of Turkey ( 1980-2014)

Deficieny in national economy saving in developing countries makes usage of external debt inevitable. By means of external debt increase of economic growth is aimed homever there are different approaches about the effect of external debt on the economic growth in literature at this work. The relation between the economic growth and external debt is handles in terms of Turkish economy some economic annual data is used that belongs to Turkish economy between the 1980-2014 years. In the analysis, the relationship between external debt and economic growth was examined using Granger Causality and Johansen Cointegration analyzes. According to the analysis of Granger causality, there is no causality relation between external debt and economic growth, and according to Johansen Cointegration analysis, it is found that there is a long-run relationship between these two variables. Key Words: External Debt, Economic Growth, ADF and Philips - Perron Test, Granger Causality Test