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Structural Reforms to Boost Turkey's Long-Term Growth

Author

Listed:
  • Rauf Gönenç

    (OECD)

  • Oliver Röhn

    (OECD)

  • Vincent Koen
  • Şeref Saygili

    (OECD)

Abstract

Turkey can achieve strong sustainable growth and job creation but further reforms in the labour market, education and product markets are required for such gains to materialise. In recent years, growth has been largely driven by the industrial catch-up of Anatolian regions, although the Marmara area in the West has also been very dynamic. In the process, labour force participation has started to rise anew, but around one third of new low-skilled jobs have been created in the informal sector. Sustaining vigorous growth over the longer run therefore requires pushing ahead with a number of structural reforms. First, Turkey’s rigid labour market regulation needs to evolve, so as to encourage job creation in the formal sector. Second, further progress with education reform, from pre-school all the way to the tertiary level and vocational training, is needed to boost growth and bring about employment gains in the formal sector. Third, implementing product market reforms, notably in network industries, would unleash productivity gains in those sectors and be a boost to the rest of the economy. A set of alternative growth scenarios through 2030 illustrates how progress on these various fronts can deliver lasting improvements in living standards. This Working Paper relates to the 2012 OECD Economic Survey of Turkey (www.oecd.org/eco/surveys/turkey). Des réformes structurelles pour stimuler la croissance à long terme en Turquie La Turquie a les moyens d’une croissance rapide et durable riche en emplois, mais des réformes s’imposent en matière de – marché du travail, d’éducation et de marchés de produits –pour que ce potentiel se concrétise. Le rattrapage industriel des régions d’Anatolie a largement tiré la croissance de ces dernières années, même si la région de Marmara, à l’ouest, a elle aussi été très dynamique. Accompagnant ce processus, la participation au marché du travail est repartie à la hausse, mais environ un tiers des nouveaux emplois peu qualifiés ont été créés dans l’économie informelle. Maintenir un rythme de croissance vigoureux sur longue période nécessite donc de faire avancer un certain nombre de réformes structurelles. Tout d’abord, la réglementation du marché du travail, rigide, doit évoluer de façon à encourager la création d’emplois dans l’économie formelle. Ensuite, il faut aller plus loin encore dans les réformes de l’éducation, de l’enseignement préscolaire à l’enseignement supérieur et à la formation professionnelle, pour dynamiser la croissance et favoriser les créations d’emplois dans le secteur formel. Enfin, la mise en oeuvre de réformes des marchés de produits, notamment dans les industries de réseau, devrait permettre de libérer des gains de productivité dans ces secteurs et insuffler une dynamique au reste de l’économie. Différents scénarios de croissance à l’horizon 2030 montrent comment les avancées sur ces différents fronts peuvent engendrer une amélioration durable du niveau de vie. Ce Document de travail se rapporte à l’Étude économique de l’OCDE de la Turquie, 2012 (www.oecd.org/eco/surveys/turkey).

Suggested Citation

  • Rauf Gönenç & Oliver Röhn & Vincent Koen & Şeref Saygili, 2012. "Structural Reforms to Boost Turkey's Long-Term Growth," OECD Economics Department Working Papers 987, OECD Publishing.
  • Handle: RePEc:oec:ecoaaa:987-en
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    File URL: http://dx.doi.org/10.1787/5k92smv7cnjl-en
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    Cited by:

    1. Izak Atiyas & Ozan Bakis & Esra Ceviker Gurakar, 2016. "Anatolian Tigers and the Emergence of the Devout Bourgeoisie in the Turkish Manufacturing Industry: An Empirical Analysis," Working Papers 1064, Economic Research Forum, revised 11 2016.
    2. Nurrachmi, Rininta Nurrachmi & Abd Samad, Khairunnisa & Foughali, Ibrahim, 2012. "The Development of SMEs in Turkey," MPRA Paper 46817, University Library of Munich, Germany.
    3. Dutz, Mark A., 2013. "Resource reallocation and innovation : converting enterprise risks into opportunities," Policy Research Working Paper Series 6534, The World Bank.

    More about this item

    Keywords

    competition; concurrence; croissance; education; employment protection legislation; growth; informality; informalité; labour market; législation sur la protection de l'emploi; marché du travail; productivity; productivité; Turkey; Turquie; éducation;

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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