State Dependence in Poverty: The Case of Turkey

Julide Yildirim, M. Akif Bakır and Ayse Savas

Emerging Markets Finance and Trade, 2018, vol. 54, issue 9, 1963-1972

Abstract: Despite poverty alleviation efforts, almost a quarter of households live below the poverty line in Turkey. This article aims to examine the dynamics of poverty focusing on poverty persistence in Turkey, utilizing Income and Living Conditions panel data belonging to 2010–2013. A random effects dynamic panel probit model has been employed. In order to tackle the initial values problem Heckman’s reduced form approximation is utilized. Empirical results indicate that gender, educational attainment, employment type, and household structure have statistically significant impact on the probability of being poor. Besides, experiencing poverty has a positive impact on future poverty likelihood, signalling state dependence.

Date: 2018
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DOI: 10.1080/1540496X.2017.1386097

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