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Investment Incentives in Türkiye: Macroeconomic Analysis with Geographically Weighted Regression

Author

Listed:
  • Serife Merve Kosaroglu

    (Sivas Cumhuriyet University, Cumhuriyet Social Sciences Vocational School, Department of Finance-Banking and Insurance)

  • Ilkay Noyan Yalman

    (Sivas Cumhuriyet University, Faculty of Economics and Administrative Sciences, Department of Econometrics)

  • Sinan Dundar

    (Sivas Cumhuriyet University, Faculty of Engineering, Department of Industrial Engineering)

  • Selcuk Yasin Yildiz

    (Sivas Cumhuriyet University, Cumhuriyet Social Sciences Vocational School, Department of Office Services and Secretarial)

  • Necati Alp Erilli

    (Sivas Cumhuriyet University, Faculty of Economics and Administrative Sciences, Department of Econometrics)

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.

Suggested Citation

  • Serife Merve Kosaroglu & Ilkay Noyan Yalman & Sinan Dundar & Selcuk Yasin Yildiz & Necati Alp Erilli, 2024. "Investment Incentives in Türkiye: Macroeconomic Analysis with Geographically Weighted Regression," World Journal of Applied Economics, WERI-World Economic Research Institute, vol. 10(2), pages 137-152, December.
    • Handle: RePEc:ana:journl:v:10:y:2024:i:2:p:137-152
    DOI: 10.22440/wjae.10.2.6
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    References listed on IDEAS

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    1. A. Stewart Fotheringham & Wenbai Yang & Wei Kang, 2017. "Multiscale Geographically Weighted Regression (MGWR)," Annals of the American Association of Geographers, Taylor & Francis Journals, vol. 107(6), pages 1247-1265, November.
    2. Montresor, Elisa & Pecci, Francesco & Pontarollo, Nicola, 2011. "The convergence process of the European regions: the role of Regional Policy and the Common Agricultural Policy," Studies in Agricultural Economics, Research Institute for Agricultural Economics, vol. 113(2), pages 1-11.
    3. Tung, Samuel & Cho, Stella, 2001. "Determinants of Regional Investment Decisions in China: An Econometric Model of Tax Incentive Policy," Review of Quantitative Finance and Accounting, Springer, vol. 17(2), pages 167-185, September.
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    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics

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