The effects of endogenization of technology upon economic growth: A comparative analysis of Turkey and South Korea

The sources of the differences between growth and welfare of countries in the globalizing world, have been a long-standing topic of debate. In the economic growth literature, there have been numerous studies to depict the sources of growth, yet, there is still no clear consensus on the issue. One of the most prominent field of studies regarding the sources of growth and welfare of nations is the endogenous growth theories which were put forward in the 90s. The effects of the technological development, which is one of the most outstanding yields of the modern era, on economic growth has served to discovering many substantial sources in relation to growth and welfare of the countries by integrating into popular culture via endogenous growth theories. The key motivation of this study which aims to contribute to the endogenous growth literature by researching the relationship between technology and growth based upon different countries and variables, is the possible technology-based differences between nations' growth and welfare levels. At this point, the main research question of this study is to determine whether or not the countries that are pursuing endogenous growth policies have more sustainable and higher quality growth compared to others. In order to provide an answer to this question, the effects of endogenization of the technology upon Turkey and South Korea, which are the sample countries that had similar economic conditions in the past but have significant differences nowadays, examined via ARDL Cointegration Analysis. Covering the period of 1990-2020, the evidences of this analysis demonstrate that South Korea had more stable and higher quality growth, thanks to its policy of endogenizing technology. However, Turkey couldn't succeed in endogenizing technology and needs to have some improvements on this area.