The Relationship between R-D Expenditures and Economic Growth: A Case of the Central Asian Republics and Turkey

Year 2016, Volume: 2 Issue: 1, 74 - 84, 01.06.2016

Said Kıngır Ahmet Kamacı

Abstract

Research and Development (R-D), which means of new technology, new information, new
production technics and new product is one of the most important resources of human capital.
In endogenously growth theories, the relationship between R-D expenditure and economic
growth that was developed by Romer, Grossman-Helpman and Aghion-Howitt, has directed a
lot of studies nowadays. Enterprises have to seeking innovation to obtain. This seeking
innovation, will raise efficiency and contribute the economic growth. Multiple countries
which provide competitive power in science and technology and product technology and
information based products, are inside the developed countries today. In this study, the
relationship between R-D expenditures and economic growth was tested with panel data
analysis for the four Central Asian Republic (Kazakhstan, Kyrgyzstan, Tajikistan and
Azerbaijan) and for Turkey. General theory shows that there is a positive relationship between
R-D and economic growth. This relationship will analyzed for the this five country. In this
context, to test the data’s stability, we made Levin-Lin and Chu (LLC) Panel Unit Root Test.
After that, we made Pedroni Cointegration and Panel Granger Causality tests. In the
conclusion of the analysis it has been reached that there is a one-sided causal relation from
economic growth to R-D expenditures. On the other hand there is no causal relation from R-D
expenditures to economic growth.

Keywords

R-D Expenditures, economic growth, panel data

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