The effect of public debt on economic growth: Turkey case

The effect of borrowing, which has increased in recent years and has become an almost normal source of income for the public, has had an impact on macroeconomic variables, especially growth, and has been an interesting issue and a considerable literature has been formed on this subject. In this study, however, theoretical and empirical aspects of the relationship between the two variables were taken independently from each other, and the issue was only explained on the basis of one of them. In this study, it is aimed to present the impact of public debt on growth, both on economic reasons which are revealed in theoretical studies as applicable to Turkey and suggested empirical studies. As a result of the analysis carried out in the light of indicators, it was concluded that public debt in Turkey after 2000 had both positive and negative consequences and the final outcome is dependent on the relative position of these two influences. The empirical study conducted to analyze the direction of the final effect, which is the dominant effect, concluded that total public debt has a positive effect on growth in the long run.