An Investigation of Co-Integration and Causality between Trade Openness and Government Size in Turkey

Ismail Aydogus and Mert Topcu
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Ismail Aydogus: Afyon Kocatepe University, Department of Economics,Afyon, Turkey

International Journal of Economics and Financial Issues, 2013, vol. 3, issue 2, 319-323

Abstract: Validity of globalization brings out the question of whether greater openness is a booster reason to have a bigger government. This issue has been started to be discussed in relevant literature since the late 1970s. In this context, the purpose of this study is to examine the linkage between trade openness and the size of the government in Turkey over the period 1974-2011. Using residual based co-integration approach, we fail to find an evidence of a long run relationship. In addition, we do not provide causal support of compensation hypothesis in Turkish economy.

Keywords: Government size; trade openness; Turkish economy (search for similar items in EconPapers)
JEL-codes: F10 H10 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eco:journ1:2013-02-5

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