The effects of İller Bank on the regional development in Turkey

The infrastructure and superstructure investments have profound effects on the economic development of a country or a region. The fast growth in the population rate, urbanization, and industrilazition in the regions and cities requires new and huge investments in the infrastructural and superstructural investments. The economic power and monetory sources of manucipalities and provience private assembly are not sufficient to finance these investments. In this connection, iller bank is a bank of local administrations, it opens credits of quiete low interest rates to support their projects and the technical investments. In this study, the effect of credits given by iller bank was investigated on the seven geographic regional development. Hence, the first chapter covers the development of investment banking in Turkey and in the world, the second chapter includes institutional duties and activities of iller bank. In the last chapter, the types of regions, the economic development level of regions in Turkey, the credits given by iller bank between 1999-2009 period were studied. Panel data analysis method was employed to analyse and comment the development level of regions.As a result, it was understood that when iller bank increases the credits 1% for a region, the GNP rises 1.05% within the region, on the other hand, 1% increase in the legitimate share of region given through city bank rises the regional GNP by 1.5%.Keywords: Development And Investment Banking, İller Bank, Regional Varieties, Regional Imbalance, Regional Development, Panel Data Analysis, Hausmann Model.