The effects of civilian and military defence expenditure on gross demostic product in Turkey: Spatial econometrics approach

Due to its geostrategic position, Turkey is located at the key point of the world. This important role is closely related to the previous and future defense spending. For this reason, many studies were conducted on the issue of defense spending in recent years, including Turkey.The purpose of this study is to estimate the spatial effect of the provincial military and civilian defense spending on economic growth. The relationship between military - civil defense spending and economic growth is examined by using spatial econometrics for 67 provinces of Turkey. According to the empirical findings, there is a statistically significant and negative relationship between Turkey?s military and civilian defense spending and economic growth for the period of 2004-2007. Positive and significant relationship was found between the economic development index and economic growth.Keywords: Military defense spending, civil defense spending, economic growth, economic development index, spatial data analysis.