İstanbul İktisat Dergisi 2602-4152 2602-3954 Istanbul University 10.26650/ISTJECON2025-1522483 Economic Theory (Other) Ekonomi Teorisi (Diğer) Technological Endogeneity and Growth Trajectories: A Comparative Analysis of Türkiye and South Korea’s Economic Journeys https://orcid.org/0000-0001-6009-2793 Göncüler Sena İstanbul Topkapı Üniversitesi https://orcid.org/0000-0002-3727-916X Demirbaş Dilek Istanbul University, Faculty of Economics, Department of Economics 07 14 2025 75 1 117 136 07 25 2024 02 26 2025 Copyright © 1939, Istanbul Journal of Economics 1939 Istanbul Journal of Economics

The sources of differences in the growth and welfare of countries in the globalising world have been a long-standing topic of debate. In the economic growth literature, numerous studies have explored these sources, yet there is still no clear consensus. One of the most prominent fields regarding the sources of growth and the welfare of nations is the endogenous growth theory introduced in the 1990s. The effects of technological development, a standout achievement of the modern era, on economic growth have led to the discovery of many substantial sources related to the growth and welfare of countries, integrated into popular culture via endogenous growth theories. This study aims to enhance the understanding of the endogenous growth theory by exploring the interplay between technology and economic development across various countries and variables. The primary motivation is to examine potential technologydriven disparities in nations’ growth and welfare levels. The main research question is whether countries pursuing endogenous growth policies experience more sustainable and higher-quality growth compared to others. To answer this question, the study examines the effects of technology endogenization on Türkiye and South Korea, two countries that had similar economic conditions in the past but now show significant differences. Using ARDL Cointegration Analysis and covering the period from 1990 to 2020, the evidence demonstrates that South Korea achieved more stable and higher-quality growth due to its policy of endogenizing technology. In contrast, Türkiye has not succeeded in this area and needs improvements.JEL Classification : C32 , O30

 Endogenous growth Technology ARDL analysis Acemoğlu, D., & Üçer, M. (2015). The Ups and Downs of Turkish Growth, 2002-2015: Political Dynamics, the European Union and the Institutional Slide. NBER Working Paper Series, No. w21608, 1(32). (Online), SSRN: https://ssrn.com/abstact=2669797. google scholar Acemoğlu, D., & Üçer, M. (2019). High-Quality versus Low-Quality Growth in Türkiye: Causes and Consequences. CEPR Discussion Paper Series, No. DP14070. (Online), SSRN: https://ssrn.com/abstract=3474442. google scholar Aghion, P., & Howitt, P. (1992). A Model of Growth Through Creative Destruction. Econometrica, 60(2), 323- 351. https://doi.org/l0.2307/ 2951599. google scholar Ahmad, M., & Zheng, J. (2022). The CYclical and Nonlinear Impact of R&D and Innovation Activities on Economic Growth in OECD Economies: a New Perspective. Journal of the Knowledge Economy, 12(2023), 544-593. https://doi.org/l0.1007/s13132-021-00887-7 google scholar Akcigit, U., Pearce, J., & Prato, M. (2024). Tapping into Talent: Coupling Education and Innovation Policies for Economic Growth. Review of Economic Studies, 2024(00), 1-41. https://doi.org/l0.1093/restud/rdae047 google scholar Behera, B., Haldar, A., & Sethi, N. (2023). Investigating the direct and indirect effects of Information and Communication TechnologY on economic growth in the emerging economies: role of financial development, foreign direct investment, innovation, and institutional qualitY. Information Technology for Development, 30(i), 33-56. https://doi.org/l0.1080/02681102.2023.2233463 google scholar Cerisier, F., & Postel-VinaY, F. (1998). Endogenous Growth and the Labour Market. Annales D'economie Et De Statistigue, 49(50), 105-126. https://doi.org/10.2307/20076112 google scholar Chiang, M.H., Kao, C., & Chen, B. (1997). International R&D Spillovers: an Application of Estimation and Inference in Panel. Oxford Bulletin of Economics and Statistics, 61 (Si), 691-709. https://doi.org/l0.111l/l468-0084.0610s1691 google scholar Cobb, C.W., & Douglas, P.H. (1928). A Theory of Production, The American Economic Review, 18(i), 139-165. google scholar Coe, D.T., & Helpman, E. (1995). International R&D Spillovers. European Economic Review, 39(1995), 859-887. https://doi.org/l0.1016/0014-292l(94)00100-E. google scholar Coe, D.T., Helpman, E., & Hoffmaister, A.W. (2009). International R&D Spillovers and Institutions. European EconomicReview, 53(7), 723-741. https://doi.org/10.1016/j.euroecorev.2009.02.005. google scholar Cuaresma, J.C., & Wörz, J. (2005). On Export Composition and Growth. Review of World Economics, 141 (i), 33- 49. https://doi.org/10.1007/ s10290-005-0014-z. google scholar Daysİ, G., Karla, M., Paco, A., & Santiago, O. (2021). Co2 Emissions, High-Tech Exports and GDP Per Capita, 16th Iberian Conference on Information Systems and Technologies, Conference Paper, ISBN: 978-989- 54659-1-0. https://doi.org/l0.23919/CISTI52073.2021. 9476289. google scholar Eaton, J., & Kortum,S. (1999). International TechnologY Diffusion: Theory and Measurement. International Economic Review, 40(3), 537-570. google scholar Ekananda, M., & Parlinggoman, D.J. (2017). The Role of High-Tech Exports and of Foreign Direct Investments (FDI) on Economic Growth. European Research Studies Journal, 20(4A), 194-212. https://doi.org/l0.35808/ersj/828 google scholar Faik, M. (2007). R&D Spending in The High-Tech Sector and Economic Growth. Research in Economics, 61(2007), 140-147. https://doi.org/ 10.1016/j.rie.2007.05.002 google scholar Göçer, İ. (2013). Ar-Ge Harcamalarının Yüksek Teknolojili Ürün İhracatı, Dış Ticaret Dengesi ve Ekonomik BÜYÜme Üzerindeki Etkileri. Maliye Dergisi, 165, 215-240. google scholar Griffith, R., Redding, S., & Reenen J.V. (2001). Mapping the Two Faces of R&D: ProductivitY Growth in a Panel of OECD Industries. Review of Economics and Statistics, 86/(4), 883-895. https://doi.org/l0.1162/0034653043125194 google scholar Grossman, G.M., & Helpman, E. (1991). Quality Ladders in the Theory of Growth. The Review of Economic Studies, 58(i), 43-61. https:// doi.org/10.3386/w3099 google scholar Grossman, G.M., & Helpman, E. (1997). Innovation and Growth in the Global EconomY, MIT Press. google scholar Ha, J., & Howitt, P. (2007). Accounting for Trends in Productivity and R&D: A Schumpeterian Critique of the Semi-Endogenous Growth Theory. Journal of Money, Credit and Banking, 39(4), 733-774. https://doi.Org/l0.111l/j.1538-4616.2007.00045.x google scholar Hamia, M.A. (2022). What Level of International TechnologY Should Developing Countries Transfer to Sustain Their Economic Growth?. Quality & Quantity, 56. https://doi.org/l0.1007/s11135-0 21-01259-8 google scholar Howitt, P. (2000). Endogenous Growth and Cross-Country Income Differences, The American Economic Review, 90(4), 829-846. https:// doi.org/10.1257/aer.90.4.829 google scholar ILO. (2021). Unemployment by Sex and Age - ILO Modelled Estimates, Nov. 2021 (Thousands) - Annual, ILO STAT, (Online), https://www. ilo.org google scholar İslam, Z., Rahaman, H., & Chen, F. (2024). How do R&D and remittances affect economic growth? Evidence from middle-income countries. Heliyon, 10(2024), 2-14. https://doi.org/l0.1016/j.helİYon.2024.e30160 google scholar Jarreau, J., & Poncet, S. (2011). Export Sophistication and Economic Growth: Evidence from China. Journal of Development Economics, 97(2), 281-292. https://doi.org/l0.1016/jjdeveco.2011.04.001 google scholar Jones, C.l. (1995). Time Series Tests of Endogenous Growth Models. The Quarterly Journal of Economics, 110(2), 495-525. https://doi.org/ 10.2307/2118448. google scholar Kim, M. (2020). Cross-Industry Distribution of R&D Investments and Economic Growth. Applied Economics Letters, 27(8), 679-684. https:// doi.org/10.1080/13504851.2019.1644426 google scholar Lam, L.F., Law, S.H., Azman-Saini, W.N.W., & İsmail, N.W. (2022). High TechnologY Trade and the Roles of Absorptive Capabilities in MalaYsia. Millennial Asia, 1-26. https://doi.org/l0.1177/0976399 6211065565 google scholar Li, X., Liang, F., Pi, Y., & Chen, D. (2024). The impact of R&D factors flow and regional absorptive capacitY on China’s economic growth: Theory and evidence. Plos One, 19(il), 1-23. https://doi.org/10.1371/journal.pone.0310476 google scholar Lucas, R.E. (1988). On The Mechanics of Economic Development. Journal of Monetary Economics, 22(88), 3-42. https://doi.org/10.1016/ 0304-3932(88)90168-7 google scholar Mackinnon, J.G. (1996). Numerical Distribution Functions for Unit Root and Cointegration Tests, Journal of Applied Econometrics, 11(6), 601-618 https://doi.org/l0.1002/(SICl)l099-1255(l9961l)l1:6<601::AID-JAE417>3.0.CO;2-T google scholar Mert, M., & Çağlar, A.E. (2019). Eviews ve Gauss UYgulamalı Time Series Analizi, DetaY YaYıncılık. google scholar Nagel, K. (2015). Relationships Between Unemployment and Economic Growth - The Review (Results) of the Theoretical and Empirical Research. Journal of Economics and Management, 20(2), 64-79. google scholar NaraYan, P.K. (2005). The Saving and Investment Nexus for China: Evidence from Cointegration Tests. Applied Economics, 37(17), 1979-1990. https://doi.org/10.1080/00036840500278103 google scholar Nihal, G., Mounia, C., Hussain, M., Humayun, S., Perveen, N., Yousaf, N.R., & Akthar, S. (2023). Impact of Innovation on Economic Growth of G8 Countries- AnalYsis Över 1996-2020. Intern. Journal of Profess. Bus. Review., 8(5), 01-18. https://doi.org/10.26668/ businessreview/2023.v8i5.1403 google scholar Nonneman, W., & Vanhoudt, P. (1996). A Further Augmentation of the Solow Model and the Empirics of Economic Growth for OECD Countries. The QuarterlyJournal of Economics, 111(3), 943-953. https://doi.org/l0.1080/00036840500278103 google scholar OECD. (2020). Total Exports: Computer, Electronic and Optical, Pharmaceutical and Aerospace IndustrY, OECD MSTI, (Online), https:// stats.oecd.org/Index.aspx?DataSet Code=MSTI_PUB. google scholar Peseran, M.H., Shin, Y., & Smith, R.J. (2001). Bounds Testing Approaches to the Analysis of Level Relationships. Journal of Applied Econometrics, 16(3), 289-326. https://doi.org/l0.1002/jae.616 google scholar Rodrik, D. (2006). What’s So Special about China’s Exports?. China and World Economy, 14(5), 1-19. https://doi.Org/10.1111/j.1749-124X. 2006.00038.x google scholar Romer, P. (1986). Increasing Returns and Long-Run Growth. Journal of Political Economy, 94(5), 1002-1037. google scholar Romer, P. (1990). Endogenous Technological Change. Journal of Political Economy, 98(5), S71-S102. google scholar Segerstrom, P.S. (1998). Endogenous Growth without Scale Effects. The American Economic Review, 88(5), 1290-1310. google scholar Sojoodi, S., & Baghbanpour, J. (2024). The Relationship Between High-Tech Industries Exports and GDP Growth in the Selected Developing and Developed Countries. Journal of the Knowledge Economy, 2024(15), 2073-2095. https://doi.org/l0.1007/s13132-023-01174-3 google scholar Solow, R.M. (1956). A Contribution to the Theory of Economic Growth. The Quarterly Journal of Economics, 70(i), 65-94. https://doi.org/ 10.2307/1884513 google scholar Tung, L.T., & Hoang, L.N. (2024). Impact of R&D expenditure on economic growth: evidence from emerging Economies. Journal of Science and Technology Policy Management, 15(3), 636-654. https://doi.org/l0.1108/JSTPM-08-2022-0129 google scholar UNESCO. (2022). Enrolment in Tertiary Education, All Programmes, Both Sexes (Number), UIS Stat, (Online), http://data.uis.unesco.org/. google scholar World Bank. (2020). GDP (Constant 2015 US$) - Türkiye, Korea Rep., 1990-2020, WDI, (Online), https:// databank.worldbank.org/ reports.aspx?source=2&series=NE.GDI.FTOT.KD&countrY=KOR,TUR#. google scholar World Bank. (2020). Gross Fixed Capital Formation (Constant 2015 US$) - Türkiye, Korea Rep., 1990-2020, WDI, (Online), https://databank. worldbank.org/reports.aspx?source=2&series=NE.GDI.FTOT.KD& countrY=KOR,TUR#. google scholar Wu, J., Ma, Z., & Zhuo, S. (2016). Enhancing National Innovative Capacity: the Impact of High-Tech International Trade and lnward Foreign Direct Investment, International Business Review, 26(3), 502-514. https://doi.Org/10.1016/j.ibusrev.2016.11.001 google scholar Zietz, J. (2006). Log-Linearizing Around the SteadY State: A Guide with Examples, SSRN Electronic Journal, 2006, 1-16. https://doi.org/10.2139/ssrn.951753 google scholar