An ampiric approach to the defence expenditures-economic growth relationship between selected European Union countries and Turkey under the development of Turkey and European Union's defence industry

In the economics literature, the relation of the expenditures made for the defence service with the economic growth is the one of controversial subjects. While it is accepted that this relation is very important and intense, there is no consensus on the effects of it. In this context, this study has been prepared in order to determine Turkey?s, in the process of accession to European Union and trying to develop its defence industry, if there is a relationship between the economic growth and defence expenditure or not; if there is, in what direction it would be.Primarily, conceptually in this study; defence, defence expenditures, and defence industry are defined. In second chapter, the economic effects of the defence industry, the defence industries that they are trying to develop as a result of the European Union and Turkey?s policies and the location that had reached today, has been observed economically and structurally. In the last chapter, the defence expenditures of Turkey and the European Union has been evaluated on a global scale and the resources of Turkey?s defence expenditures were mentioned.In the application of the study, selected European Union Countries and Turkey?s relationship of defence expenditure and economic growth in the context of gross national product, by using the defence expenditures between 1996 - 2009, has been observed by the panel data estimation method. In the result of the panel data model estimation, there is a positive relationship between defence expenditures and economic growth has been found out.Key Words: Defence, Defence Industry, Security and Defence Policy, Defence Expenditures, Economic Growth