Dynamic Analysis of Jobless Growth in Turkey

Article Information
Journal: Business and Economics Research Journal
Title of Article: Dynamic Analysis of Jobless Growth in Turkey
Author(s): Ezgi Demiral, Abreg S. Celem
Volume: 11
Number: 1
Year: 2020
Page: 63-76
ISSN: 2619-9491
DOI Number: 10.20409/berj.2020.235
Abstract
The indicators of Turkey’s economy show that the long-term growth seems not to have provided the desired reduction in the unemployment rate. This indicates that economic growth cannot create sufficient growth in employment, that is known as the jobless growth phenomenon in economics literature. In this study, we examine the dynamic effects of the national income on the unemployment rates in Turkey for the 2005-2015 period. For this purpose, primarily, Perron unit root test was applied to examine the structural breaks in the variables caused by the global crisis in 2008. Subsequently, impulse-response analysis and variance decomposition analysis based on VAR model were applied. As a result of the empirical analysis, it was concluded that the unemployment reduction effect of the growth in national income was only valid in the short term in Turkey.

Keywords: Jobless Growth, Unemployment, Growth, 2008 Global Crisis, VAR Model Analysis

JEL Classification: E24, C32, J21

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