The impact of public expenditures on private investments: An econometric assessment of Turkey for the period 1975-2023

This thesis examines the impact of public expenditures on private sector investments in Turkey from 1975 to 2023. The primary objective of the study is to understand how public expenditures affect private sector investments and to determine the direction and magnitude of this relationship. The significance of this study lies in the fact that public expenditures are one of the most influential government policies, aiming to evaluate their effects on economic growth and investments. These findings are expected to provide guidance for policymakers. In this study, ARDL and Fourier ARDL models were used as analysis methods. These models were considered effective tools for examining the short and long-term relationships between public expenditures and private sector investments. The research results show that, in the long term, bank loans provided to the private sector encourage private sector investments. However, it was determined that total public expenditures and public investments not related to infrastructure have negative effects on private investments. These findings indicate that if public expenditures are directed towards the right areas, they can support economic growth by encouraging private sector investments. The importance of infrastructure expenditures is particularly emphasized. It was concluded that such expenditures positively affect private sector investments. The findings obtained are consistent with existing studies in the literature and reinforce the role of public expenditures in economic development. The contribution of the study lies in its use of the most recent research sources to examine the relationship between variables, providing valuable references for researchers. In this context, it will be beneficial not only for Turkey but also for all researchers who want to investigate the factors affecting private investments.