TESTING THE VALIDITY OF THE COMPENSATION HYPOTHESIS BY USING PANEL DATA ANALYSIS

Öz

The compensation hypothesis has been examined throughout the literature, but there is limited research testing whether the validity of this hypothesis varies between low- and high-classification countries. Thus, the present paper extends the analysis to examine whether or not the relationship between openness and government size fluctuates across low- and high-classification countries. The classifications are based on foreign direct investment, current account, portfolio investment and income. By using a panel of 145 countries over the period 1970-2017, this paper provides robust empirical evidence about the validity of the compensation hypothesis. Regardless of the countries’ classifications, the empirical results do not differ and they confirm the compensation hypothesis proposed by Rodrik (1998).

Anahtar Kelimeler

• trade openness,government size,the compensation hypothesis

PANEL VERİ ANALİZİ İLE TELAFİ HİPOTEZİNİN GEÇERLİLİĞİNİN SINANMASI

Öz

Öz Telafi hipotezi (compensation hypothesis) literatürde birçok çalışmada incelenmiştir, ancak bu hipotezin geçerliliğinin farklı ülke özelliklerine göre değişip değişmediğine dair sınırlı sayıda çalışma bulunmaktadır. Dolayısıyla, bu çalışmada dışa açıklık ve kamu harcamalarının büyüklüğü arasındaki ilişkinin nasıl farklılık gösterdiği analiz edilmiştir. Farklı ülke özellikleri için doğrudan yabancı sermaye yatırımları, cari açık, portföy yatırımları, kişi başı milli gelir temel alınmıştır. Çalışma 1970-2017 dönemine ait 145 ülkeden oluşan panel veri seti kullanarak telafi hipotezinin geçerliği hakkında güçlü ampirik kanıtlar sunmaktadır. Bulgular telafi hipotezinin geçerliğinin farklı ülke özelliklerine göre değişmediğini göstererek Rodrik (1998) tarafından geliştirilen telafi hipotezinin geçerliliğini doğrulamaktadır.

Anahtar Kelimeler

• dışa açıklık,kamu harcamaları,telafi hipotezi

Kaynakça

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