Investment Incentives in Türkiye: Macroeconomic Analysis with Geographically Weighted Regression
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Abstract
One of the most important objectives of investment incentive policies implemented in Türkiye is to reduce regional development level disparities. In this context, 81 provinces were classified into six regions, and region-specific investment incentives with different scopes and budgets have been implemented. The effectiveness and contributions of investment incentives to the region are essential in economies such as Türkiye, where regional imbalances are evident. In this study, investment incentives implemented in Türkiye are examined from a macroeconomic perspective to determine their economic effects using the geographical (spatial) analysis method. The results show that the relationship between investments, employment, the number of incentive applications, and exports within the scope of incentives and province-level national income is more substantial in particular provinces. Our analysis indicates that increasing the effectiveness of incentives requires developing institutions to continuously and dynamically evaluate and monitor the impacts of these policies.
JEL Codes: O10, O20, C010
Keywords: Investment Incentive System, Turkish economy, GWR method
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How to Cite
Koşaroğlu, Şerife, Noyan Yalman, İlkay, Dündar, S., Yıldız, S. and Erilli, N. (2024) “Investment Incentives in Türkiye: Macroeconomic Analysis with Geographically Weighted Regression”, World Journal of Applied Economics, 10(2), pp. 137-152. doi: 10.22440/wjae.10.2.6.
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Research Articles
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References
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Oz, B. (2019). Gelir ve Kurumlar Vergisinin Tasarruflar Uzerindeki Etkisi. Euroasia Journal of Social Sciences & Humanities, 6 (5), 62-71.
Oz, E., & Buyrukoglu, S. (2017). Turkiye’de Uygulanan Yatirim Tesvik Politikalarinin Makroekonomik Degiskenler Uzerindeki Etkisinin Ampirik Analizi. Pamukkale Universitesi Sosyal Bilimler Enstitusu Dergisi , 27 (1-2), 322-336.
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Sartika, E., & Murniati, S. (2021). Application of the Geographically Weighted Regression (GWR) with the Bi-Square Weighting Function on the Poverty Model in the City/Regency of West Java. Advances in Engineering Research, 207, 201-207. doi:10.2991/aer.k.211106.031
Sasmaz, M. U., & Bayar, Y. (2017). Mali Tesvikler ile Dogrudan Yabancı Sermaye Girisleri Arasindaki Iliskinin ARDL Yaklasimi ile Analizi: Turkiye Ornegi. Yonetim Bilimleri Dergisi, 15 (30), 297-307.
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Yavan, N. (2012). Turkiye’de Yatirim Tesviklerinin Bolgesel Belirleyicileri: Mekansal ve Istatistiksel Bir Analiz. Cografi Bilimler Dergisi, 10 (1), 9-37. doi:10.1501/Cogbil 0000000129
Yilmaz, H. (2020). Turkiye’de Yatirim Tesvik Sisteminin Tarihcesi. Akademik Arastırmalar ve Calismalar Dergisi , 12 (23), 431-441. doi:10.20990/kilisiibfakademik.707681
Akdeve, E., & Karagol, E. T. (2013). Gecmisten Gunumuze Turkiye’de Tesvikler ve Ulke Uygulamalari. Dumlupinar Universitesi Sosyal Bilimler Dergisi, 37, 329-350.
Ay, H. M. (2005). Yatirim Tesviklerinin Sabit Sermaye Yatirimlari Uzerindeki Etkisi. Selcuk Universitesi Karaman Iktisadi ve Idari Bilimler Dergisi, 2 (5), 176-184.
Fotheringham, A. S., Brunsdon, C., & Charlton, M. (2002). Geographically Weighted Regression: The Analysis of Spatially Varying Relationships. John Wiley & Sons, UK.
Fotheringham, A. S., Yang, W., & Kang, W. (2017). Multiscale Geographically Weighted Regression (MGWR). Annals of the American Association of Geographers, 107 (6), 1247-1265. doi:10.1080/24694452.2017.1352480
Gerni, C., Sari, S., Sevinc, H., & Emsen, O. S. (2015). Bolgesel Dengesizliklerin Giderilmesinde Yatirim Tesviklerinin Rolu ve Basari Kriteri Olarak Yakinsama Analizleri: Turkiye Ornegi. In International Conference on Eurasian Economies, 9-11 Eylul 2015, Kazan-Rusya. https://avekon.org/papers/1234.pdf.
Gollini, I., Lu, B., Charlton, M., Brunsdon, C., & Harris, P. (2013). GWmodel: an R Package for Exploring Spatial Heterogeneity Using Geographically Weighted Models. Journal of Statistical Software, 63 (17), 1–50. doi:10.48550/arXiv.1306.0413
Gonzalez-Paramo, J. M., & Lopez, D. M. (2003). Public Investment and Convergence in the Spanish Regions (Studies on the Spanish Economy, No. 112). FEDEA. https://documentos.fedea.net/pubs/eee/eee112.pdf.
Goss, E. P., & Phillips, J. M. (1999). Do Business Tax Incentives Contribute to a Divergence in Economic Growth? Economic Development Quarterly, 13 (3), 217- 228. doi:10.1177/089124249901300302
Guo, L., Ma, Z., & Zhang, L. (2008). Comparison of Bandwidth Selection in Application of Geographically Weighted Regression: A Case Study. Canadian Journal of Forest Research, 38 (9), 2526-2534. doi:10.1139/X08-091
Gulmez, M., & Noyan Yalman, I. (2010). Yatirim Tesviklerinin Bolgesel Kalkinmaya Etkileri: Sivas Ili Ornegi. Ataturk Universitesi Iktisadi ve Idari Bilimler Dergisi, 24 (2), 235-257.
Gurler Hazman, G., & Karakus Buyukben, N. (2020). Vergi Tesviklerinin Yerel Ekonomik Buyume ve Istihdam Uzerindeki Etkisi: TR33 Bolgesi Acisindan Degerlendirme. Maliye Dergisi, 179, 186–212.
Ilkhan, C., Cevikgil, D., Aydin, B., & Zeren, F. (2022). Bolgesel Yatirim Tesviklerinin Ekonomik Buyume ve Ihracata Etkisi: Turkiye Ornegi. Bucak Isletme Fakultesi Dergisi, 5 (1), 47-65.
Kamata, K., Iwasawa, M., & Tanaka, K. (2009). Spatial Variations in Fertility: Geographically Weighted Regression Analyses for Town-and-Village-level TFR in Japan. The Journal of Population Studies, 45, 1-20. doi:10.24454/jps.45.0 1
Lu, B., Brunsdon, C., Charlton, M., & Harris, P. (2017). Geographically Weighted Regression with Parameter-Specific Distance Metrics. International Journal of Geographical Information Science, 31 (5), 982-998. doi:10.1080/13658816.2016.1263731
Lu, B., Charlton, M., Harris, P., & Fotheringham, A. S. (2014). Geographically Weighted Regression with a Non-Euclidean Distance Metric: A Case Study Using Hedonic House Price Data. International Journal of Geographical Information Science, 28 (4), 660–681. doi:10.1080/13658816.2013.865739
Lu, B., Yang, W., Ge, Y., & Harris, P. (2018). Improvements to the Calibration of a Geographically Weighted Regression with Parameter-Specific Distance Metrics and Bandwidths. Computers, Environment and Urban Systems, 71, 41-57. doi:10.1016/j.compenvurbsys.2018.03.012
Madani, D. H., & Mas-Guix, N. (2011). The Impact of Export Tax Incentives on Export Performance: Evidence from the Automotive Sector in South Africa (Policy Research Working Paper, No. 5585). World Bank. https://documents1.worldbank.org/curated/en/913141468114550935/pdf/WPS5585.pdf.
Mahdavikia, N., & Tanrioven, C. (2022). Mali Tesviklerin ve Vergi Tesviklerinin Sanayi Yatirimlarina Etkileri. Ucuncu Sektor Sosyal Ekonomi Dergisi, 57 (2), 1233-1248. doi:10.15659/3.sektor-sosyal-ekonomi.22.06.1841
Montresor, E., Pecci, F., & Pontarollo, N. (2011). The Convergence Process of the European Regions: The Role of Regional Policy and the Common Agricultural Policy. Studies in Agricultural Economics, 113 (2), 167-177. doi:10.22004/ag.econ.119653
Ogut, M. U., & Barbaros, R. F. (2003). Regional Development Ineqalities in Turkey: An Assesment on the Distribution of Investment Incentives. In ODT¨U Ekonomi Kongresi-VII, 6-9 Eylul 2003, Ankara.
Oz, B. (2019). Gelir ve Kurumlar Vergisinin Tasarruflar Uzerindeki Etkisi. Euroasia Journal of Social Sciences & Humanities, 6 (5), 62-71.
Oz, E., & Buyrukoglu, S. (2017). Turkiye’de Uygulanan Yatirim Tesvik Politikalarinin Makroekonomik Degiskenler Uzerindeki Etkisinin Ampirik Analizi. Pamukkale Universitesi Sosyal Bilimler Enstitusu Dergisi , 27 (1-2), 322-336.
Recepoglu, M., & Deger, M. K. (2016). Turkiye’de Bolgesel Yatirim Tesviklerinin Bolgesel Ekonomik Buyume Uzerine Etkisi: Duzey 2 Bolgeleri Uzerine Panel Veri Analizleri (2004-2011). Kastamonu Universitesi Iktisadi ve Idari Bilimler Fakultesi Dergisi, 14 (4), 6-21.
Recepoglu, M., Doganay, M. A., & Deger, M. K. (2022). Yatirim Tesvikleri, Kamu Yatirim Harcamalari ve Ihracat Arasi Iliskiler: Turkiye’de Iller Uzerine Panel Nedensellik Analizi. Mehmet Akif Ersoy Universitesi Iktisadi ve Idari Bilimler Fakultesi Dergisi, 9 (2), 1056-1081. doi:10.30798/makuiibf.979277
Republic of Turkiye Ministry of Industry and Technology. (2023). Investment Statistics. https://www.sanayi.gov.tr/istatistikler/yatirim-istatistikleri.
Republic of Turkiye Ministry of Industry and Technology. (2024). Devlet Yardimlari Hakkinda Genel Karar. https://www.sanayi.gov.tr/mevzuat/diger/mc0403018201.
Sagdic, E. N., Karas, G., & Yildiz, F. (2021). The Impact of Investment Incentives on Regional Economic Growth in Turkey: An Empirical Analysis. Sayistay Dergisi, 32 (121), 39-64. doi:10.52836/sayistay.966483
Sahin, M., & Uysal, O. (2011). Bolgesel Kalkinma Cercevesinde Yatirim Tesviklerinin Shift-Share Analizi. Maliye Dergisi, 160 , 111-138.
Sartika, E., & Murniati, S. (2021). Application of the Geographically Weighted Regression (GWR) with the Bi-Square Weighting Function on the Poverty Model in the City/Regency of West Java. Advances in Engineering Research, 207, 201-207. doi:10.2991/aer.k.211106.031
Sasmaz, M. U., & Bayar, Y. (2017). Mali Tesvikler ile Dogrudan Yabancı Sermaye Girisleri Arasindaki Iliskinin ARDL Yaklasimi ile Analizi: Turkiye Ornegi. Yonetim Bilimleri Dergisi, 15 (30), 297-307.
Sassi, M. (2009). Agricultural Convergence and CAP in the EU-15: A Territorial Approach. Atlantic Economic Journal, 37 (5), 449-450. doi:10.1007/s11293-009-9187-5
Sevinc, E., & Seker, A. (2023). Yatirim Tesvikleri ile Uluslararasi Ticaret ve Dogrudan Yabancı Yatirimlar Arasindaki Iliskii: Turkiye Ornegi (2001-2021). Alanya Akademik Bakis, 7 (1), 337-354. doi:10.29023/alanyaakademik.1115832
Telbas, A., & Yalcinkaya, M. H. (2022). Bolgesel Kalkinmada Yatirim Tesvikleri. Iksad Yayinevi, Ankara.
Tung, S., & Cho, S. (2001). Determinants of Regional Investment Decisions in China: An Econometric Model of Tax Incentive Policy. Review of Quantitative Finance and Accounting, 17, 167-185. doi:10.1023/A:1017925721627
Turkish Statistical Institute. (2023). Statistics. https://www.tuik.gov.tr/.
Wu, R., Zhang, J., Bao, Y., & Tong, S. (2016). Using a Geographically Weighted Regression Model to Explore the Influencing Factors of CO2 Emissions from Energy Consumption in the Industrial Sector. Polish Journal of Environmental Studies, 25 (6), 2641-2651. doi:10.15244/pjoes/64142
Yavan, N. (2012). Turkiye’de Yatirim Tesviklerinin Bolgesel Belirleyicileri: Mekansal ve Istatistiksel Bir Analiz. Cografi Bilimler Dergisi, 10 (1), 9-37. doi:10.1501/Cogbil 0000000129
Yilmaz, H. (2020). Turkiye’de Yatirim Tesvik Sisteminin Tarihcesi. Akademik Arastırmalar ve Calismalar Dergisi , 12 (23), 431-441. doi:10.20990/kilisiibfakademik.707681