Determinants of private investments in Turkey: Examining the role of democracy-Reference-Cited by-同舟云学术

Determinants of private investments in Turkey: Examining the role of democracy

Published:2020-03-01 Issue:1 Volume:20 Page:23-49
ISSN:1804-1663
Container-title:Review of Economic Perspectives
language:en
Short-container-title:

Author:

Akçay Selçuk¹^ORCID,Karasoy Alper¹^ORCID

Affiliation:

1. Afyon Kocatepe University , Faculty of Economics and Administrative Sciences, Department of Economics , Afyonkarahisar , Turkey .

Abstract

Abstract This study investigates the determinants of private sector investments in Turkey with a focus on democracy. Using the Autoregressive Distributed Lag (ARDL) bounds testing approach and two different democracy indices along with the other determinants of private investment, we estimated a private investment function for the 1975-2014 period. Our main finding is that democracy has a profound positive impact on private investment. Moreover, the results show that: (i) public investment is a substitute to private investment; (ii) macroeconomic instability dissuades private investment; (iii) real interest is a serious impediment to private investment; (iv) financial development and GDP growth rate stimulate private investment.

Publisher

Walter de Gruyter GmbH

Subject

General Economics, Econometrics and Finance

Link

https://www.sciendo.com/pdf/10.2478/revecp-2020-0002

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