Poverty trends in Turkey

This paper provides new evidence about poverty trends in Turkey between 2003 and 2012 and the factors accounting for them. We give particular attention to issues of statistical inference, and the choice of the poverty line and the poverty measure. Our robust conclusion is that absolute poverty declined rapidly between 2003 and 2008 but fell only slightly between 2008 and 2012. Changes in relative poverty were negligible throughout. Using decomposition methods, we argue that the declines in the absolute poverty rate are largely accounted for by changes in the rate of economic growth rather than by distributional changes or changes in population composition

Türkiye'nin yoksulluk dinamikleri.

Poverty analysis has been confined to incidence studies in Turkey. In the last decade research has focused on poverty persistence referred to as „new poverty‟, but it has not been quantified. In this thesis, we examine poverty dynamics in Turkey using the panel feature of the Survey of Income and Living Conditions for the years 2006 and 2007. Our aim is to contribute to the understanding of poverty persistence in Turkey and provide an input to the policy development to combat it. Firstly, we examine poverty transitions. Our results suggest that changes in earnings are important for transitions and individuals who experience poverty are more likely to experience it again. Heterogeneity among individuals and the causal link between past and current poverty (true state dependence) are processes that generate persistence. Secondly, we employ endogenous selection model to distinguish these processes. The results suggest that true state dependence is significant even after controlling for individual and household level characteristics. We search the source of state dependence in poverty in the labor market. Employing a similar model as in poverty persistence, a significant true state dependence in low-pay is found. When the poor are caught in low-pay trap, they are also caught in poverty trap. Lastly, we analyze whether social assistance is a remedy for state dependence in poverty. We find the effect of social assistance on poverty (direct effects) to be small. The analysis of potential work disincentive effects (indirect) of social assistance indicates that it leads to slower entry into employment.Ph.D. - Doctoral Progra

The effect of the global financial crisis on household income, inequality and poverty in Turkey

Using a nationally representative large scale micro data, we investigate the effect of the Global Financial Crisis (GFC) on household income, inequality and poverty in Turkey. In assessing the impact of the GFC, we take 2007 (pre-crisis year) as the benchmark and compare 2009 to 2007 and to 2011 (post-crisis period). We find that (real) household disposable income drops by 3.6 percent from 2007 to 2009, but that the decline in equivalized income is lower at 1.2 percent. Income inequality decreases over the crisis period, so does the absolute poverty rate, though quite marginally. Changes in household size and composition, household labor supply and non-contributory transfers help mitigate the negative effects of the GFC. The period following the crisis is marked by increases in both disposable income and equivalized income, and a sizeable drop in the poverty rate though we also observe an increase in income inequality.Publisher's Versio