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Optimal Size of Government in Turkey

Year 2014, Volume: 4 Issue: 2, 286 - 294, 01.06.2014

Abstract

This paper examines the relationship between a size of the government and the economic growth and estimates the optimal size of the government for Turkey by using two different specifications. We find that the optimal size of the central government varies from 8.8 (15.4) to 9.1 (17) percent of GDP for 1950-2012 (1970-2012) period, depending on the specification. The optimal size of the central government expenditures excluding the interest payments is 14.4 percent of GDP. The actual rates have been well above the estimated optimal ones for a long time. The results of our quadratic specification also suggest that Armey curve is valid for Turkey during the period examined. We find that the estimated optimal sizes of the government from different specifications are consistent with each other, but there is a substantial variation in the size when different time periods are used. This shows that Armey curve is sensitive to change in the time periods. Our results clearly point out that the Turkish government should cut its expenditures in order to have a growth maximizing size.

Year 2014, Volume: 4 Issue: 2, 286 - 294, 01.06.2014

Abstract

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Details

Other ID JA35ZD22DH
Journal Section Research Article
Authors

Taner Turan This is me

Publication Date June 1, 2014
Published in Issue Year 2014 Volume: 4 Issue: 2

Cite

APA Turan, T. (2014). Optimal Size of Government in Turkey. International Journal of Economics and Financial Issues, 4(2), 286-294.
AMA Turan T. Optimal Size of Government in Turkey. IJEFI. June 2014;4(2):286-294.
Chicago Turan, Taner. “Optimal Size of Government in Turkey”. International Journal of Economics and Financial Issues 4, no. 2 (June 2014): 286-94.
EndNote Turan T (June 1, 2014) Optimal Size of Government in Turkey. International Journal of Economics and Financial Issues 4 2 286–294.
IEEE T. Turan, “Optimal Size of Government in Turkey”, IJEFI, vol. 4, no. 2, pp. 286–294, 2014.
ISNAD Turan, Taner. “Optimal Size of Government in Turkey”. International Journal of Economics and Financial Issues 4/2 (June 2014), 286-294.
JAMA Turan T. Optimal Size of Government in Turkey. IJEFI. 2014;4:286–294.
MLA Turan, Taner. “Optimal Size of Government in Turkey”. International Journal of Economics and Financial Issues, vol. 4, no. 2, 2014, pp. 286-94.
Vancouver Turan T. Optimal Size of Government in Turkey. IJEFI. 2014;4(2):286-94.