Presentation on theme: "THE EFFECTS OF PUBLIC CAPITAL ON REGIONAL CONVERGENCE IN TURKEY Ozlem Onder, Metin Karadag, Ertugrul Deliktas Department of Economics, Ege University."— Presentation transcript:
THE EFFECTS OF PUBLIC CAPITAL ON REGIONAL CONVERGENCE IN TURKEY Ozlem Onder, Metin Karadag, Ertugrul Deliktas Department of Economics, Ege University
Aim of the Study to investigate the impact of public capital on regional convergence in Turkey at NUTS 1 level by using dynamic panel data model for the time period 1980-2001
Table 1: Basic Data for Turkish Regions at NUTS I Level NUTS I RegionsPopulation in Year 2000 (000) Share of the total population in 2000 (%) GDP per capita in 2000 (YTL, in) (1987 prices) Real GDP as a Proportion of Turkey’s Average in 2000 Share of total Gross Domestic Product in 2000 Share of total Pub. Invest. Expend. on average (1980- 2000) Istanbul 10018.714.782644.215022.1811.52 Western Marmara 2896.04.271998.21134.844.23 Aegean 8938.813.182037.611615.2518.31 Eastern Marmara 5741.28.472573.914612.378.86 Western Anatolia 6443.29.502062.111711.1212.35 Mediterranean 8706.012.841653.19412.0512.04 Central Anatolia 4189.36.181251.5714.396.07 Western Black Sea 4895.77.221373.5785.637.06 Eastern Black Sea 3131.54.621108.1632.902.87 North Eastern Anatolia 2507.73.70744.3421.562.83 Middle Eastern Anatolia 3727.05.50844.1482.634.90 South Eastern Anatolia 6608.69.75917.1525.078.96 Turkey 67803.9 100.00 1760.9 100100.00
Methodology Conditional Convergence Model (Mankiw et al. 1992) Dynamic Panel Data Model (Islam, 1995) = per capita real income, = real public capital stock,
Methodology Spatial Panel Data (Elhorst, 2003) Fixed Effect Spatial Lag Model (FSLM) Fixed Effect Spatial Error Model (FSEM)
Data Annual data on per capita real income and public capital stock at NUTS-1 level regions of Turkey between 1980-2001.
Table 3: Estimation Results Dependent Variable: y it Pooled LSDVGMM-SYS Constant0.114 (0.98) -1.431 (-1.35) y it-1 0.975*** (93.49) 0.880*** (35.39) 0.851*** (17.30) pubcap it-1 0.007 (0.35) 0.056* (1.72) 0.154*** (2.30) Convergence rate λ0.0250.1280.160 R2R2 0.9820.983 N252 Instruments diagnostics Hansen11.87 AR(1) c -2.87*** AR(2)-0.71
Table 4: Estimation Results with Spatial Effect Dependent variable: y it FSLM FSEM y it-1 0.812*** (18.481) 0.831*** (25.204) Pubcap it-1 0.041 (1.345) 0.004 (0.176) W.y it 0.09* (1.846) 0.613*** (0.000) Convergence rate λ0.2080.185 R2R2 0.9850.990 N252
Questions for further study Is it possible to apply spatial panel data models to dynamic panel data models Convergence rates What are specification tests for panel data
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