The Nexus Between Imports and National Income in Turkey

Özcan Karahan () and Olcay Çolak ()
Additional contact information
Özcan Karahan: Balıkesir University
Olcay Çolak: Uşak University

A chapter in Economic Crisis, Development and Competitiveness in Southeastern Europe, 2016, pp 93-104 from Springer

Abstract: Abstract Nowadays the investigation of the relationship between import and national income has been the major issue of many empirical studies in literature. Keynesian Models traditionally argue that a rise in import decrease the net export and hence aggregate demand as a basic source of economic growth, which implies a negative causal relationship from import to national income. Contrarily, Endogenous Growth Models put forward that imports play a positive and promoting role in a rise in real national income via technology transfer. Accordingly, imports transfer new technologies embodied in capital and intermediate goods and thus spur production productivity especially in developing countries. Consequently, Endogenous Growth Models advocate the import-led economic growth while Keynesian Models assert import-led economic shrinkage. The aim of this paper is to test these arguments concerning with the impacts of import on Turkish economy. We use time series techniques based on Johansen co-integration and Granger causality tests and Innovation Accounting Techniques for the quarterly data from 2002 to 2014. Empirical findings indicate that there is a strong causality relationship from the imports towards economic growth, supporting the argument of Endogenous Growth Models. Thus, sustainable growth rates in Turkey need outward-looking policy including not only exports but also import and policy covering the measures supporting steadily financing of imports.

Keywords: Economic Growth; Gross Domestic Product; Productivity Growth; Foreign Trade; Unit Root Test (search for similar items in EconPapers)
Date: 2016
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:conchp:978-3-319-40322-9_6

Ordering information: This item can be ordered from
http://www.springer.com/9783319403229

DOI: 10.1007/978-3-319-40322-9_6

Access Statistics for this chapter

More chapters in Contributions to Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().