Does Internal Migration Lead to Faster Regional Convergence in Turkey? An Empirical Investigation

In this study, we examine whether internal migration in the last 30 years in Turkey has had any effect on the speed of convergence across Turkish provinces. According to our results, contrary to the predictions of the standard neoclassical theory, for 1975-2000,internal migration is not conducive to faster convergence across provinces in Turkey. One probable reason is that marginal returns to capital in most net outmigration provinces and regions are relatively lower than those in the net in-migration provinces and regions in Turkey. Accordingly, the incentives to invest in capital in net-out migration regions may well be less than those in the net in-migration regions.Faced with lower investment in gross capital formation, and thus lower economic growth, net out-migration provinces and regions may not benefit from out-migration in terms of convergence in per capita income.

International Capital Mobility and Factor Reallocation in a Multisector Economy

This paper examines the effects of international capital flows in a small open econ omy utilizing a dynamic general equilibrium framework based on a three-sector Ramsey growth model. In order to analyze the impact of international capital mobility on production, consumption and allocation of resources across three sectors ,two different economic environments are modelled. The first model represents an open economy with capital mobility (a more comprehensive environment),and the second model introduces a closed economy with no capital mobility. Numerical applications of the models use data from the Turkish economy for the year 2002. The numerical results demonstrate that the presence of capital mobility, despite being limited by a borrowing constraint, reverses the impact of economic growth on production and resource allocation. The results also show that while production in the closed economy model simply adjusts to domestic demand, that of the open economy model is not constrained by it. Results further point that although there is positive growth in income and output in both environments, income growth in the capital mobility environment falls short of that in the no capital mobility environment. This result can be attributed to the relatively slower accumulation of capi tal in the former, which may be compensated by a positive rate of technological progress to accompany international capital flows.International Capital Flows,Human Capital, Multisector economy,Borrowing Constraint

Regional convergence and the causal impact of migration on regional growth rates

The standard growth theory predicts that allowing for labor mobility across regions would increase the speed of convergence in per capita income levels and that migration has a negative causal impact on regional growth rates. Although the empirical literature has uncovered some evidence for the former implication, the latter has not been verified empirically. This paper provides empirical evidence for the negative causal impact of migration on provincial growth rates in a developing country with a high level of internal migration that is characterized by unskilled labor exiting rural areas for urban centers. We utilize instrumental variables estimation method with an instrument unique to the country examined and also control for provincial fixed effects.Regional convergence; Regional growth; Internal migration; Fixed effects; IV estimation

Does Internal Migration Lead to Faster Regional Convergence in Turkey? an Empirical Investigation

In this study, using econometric methods, we examine whether internal migration in the last 30 years in Turkey has had any effect on the speed of convergence across Turkish provinces. According to standard neoclassical theory, migration across regions is conducive to faster convergence in income per capita: migration occurs from regions with low per capita income towards regions with higher per capita income, thus per capita income in in-migration regions would fall while that in out-migration regions would tend to rise, holding all else constant. In this study, we first test for absolute convergence across 67 Turkish provinces for 1975-2000 using non-linear least squares method. We find that there occurs no absolute convergence, meaning that provinces with initial-low-income per capita had no tendency to grow at a faster rate than provinces with initial-higher-income per capita. This result may be due to the fact that there are significant structural differences among provinces. To test this likelihood, regional dummies and sectoral shares in gross provincial product variables (agriculture, industry and services) are added to the convergence regressions. As expected, when we control for regional and sectoral differences across provinces, convergence across provinces occurs. Lastly, in order to assess the contribution of migration to convergence, we include net migration rates as explanatory variables to convergence regressions. We use the Instrumental Variables method in order to control for endogeneity between growth in per capita income and migration. According to our preliminary results, contrary to the predictions of the standard neoclassical theory, for 1975-2000, internal migration is not conducive to faster per capita income convergence across provinces in Turkey. One probable reason is that the marginal returns to capital in most net out-migration provinces and regions are relatively lower than those in the net in-migration provinces and regions in Turkey. Accordingly, the incentives to invest in capital in net-out migration regions may well be less than those in the net in-migration regions. Faced with lower investment in gross capital formation, and thus lower economic growth, net out-migration provinces and regions may not benefit from out-migration in terms of convergence in per capita income.

Regional Convergence and The Causal Impact of Migration on Regional Growth Rates

The standard growth theory predicts that allowing for labor mobility across regions would increase the speed of convergence in per capita income levels and that migration has a negative causal impact on regional growth rates. Although the empirical literature has uncovered some evidence for the former implication, the latter has not been verified empirically. This paper provides empirical evidence for the negative causal impact of migration on provincial growth rates in a developing country with a high level of internal migration that is characterized by unskilled labor exiting rural areas for urban centers. We utilize instrumental variables estimation method with an instrument unique to the country examined and also control for provincial fixed effects.Regional convergence; Regional growth; Internal migration; Fixed effects; IV estimation

Regional convergence and the causal impact of migration on regional growth rates

The standard growth theory predicts that allowing for labor mobility across regions would increase the speed of convergence in per capita income levels and that migration has a negative causal impact on regional growth rates. Although the empirical literature has uncovered some evidence for the former implication, the latter has not been verified empirically. This paper provides empirical evidence for the negative causal impact of migration on provincial growth rates in a developing country with a high level of internal migration that is characterized by unskilled labor exiting rural areas for urban centers. We utilize instrumental variables estimation method with an instrument unique to the country examined and also control for provincial fixed effects

Migration and Regional Convergence: An Empirical Investigation for Turkey

The standard growth model predicts that allowing for labor mobility across regions would increase the speed of convergence in per capita income levels and that migration has a negative causal impact on regional growth rates. Although the empirical literature has uncovered some evidence for the former implication, the latter has not been verified empirically. This paper provides empirical evidence for the negative causal impact of migration on provincial growth rates in a developing country with a high level of internal migration that is characterized by unskilled labor exiting rural areas for urban centers. We utilize an instrumental variables estimation method with an instrument unique to the country examined, and we also control for provincial fixed effects

Regional convergence and the causal impact of migration on regional growth rates

The standard growth theory predicts that allowing for labor mobility across regions would increase the speed of convergence in per capita income levels and that migration has a negative causal impact on regional growth rates. Although the empirical literature has uncovered some evidence for the former implication, the latter has not been verified empirically. This paper provides empirical evidence for the negative causal impact of migration on provincial growth rates in a developing country with a high level of internal migration that is characterized by unskilled labor exiting rural areas for urban centers. We utilize instrumental variables estimation method with an instrument unique to the country examined and also control for provincial fixed effects

Migration and Regional Convergence: An Empirical Investigation for Turkey

The standard growth model predicts that allowing for labor mobility across regions would increase the speed of convergence in per capita income levels and that migration has a negative causal impact on regional growth rates. Although the empirical literature has uncovered some evidence for the former implication, the latter has not been verified empirically. This paper provides empirical evidence for the negative causal impact of migration on provincial growth rates in a developing country with a high level of internal migration that is characterized by unskilled labor exiting rural areas for urban centers. We utilize an instrumental variables estimation method with an instrument unique to the country examined, and we also control for provincial fixed effects

MACRO-MICRO FEEDBACK LINKS OF IRRIGATION WATER MANAGEMENT IN TURKEY

Agricultural production is heavily dependent on water availability in Turkey, where half the crop production relies on irrigation. Irrigated agriculture consumes about 75 percent of total water used, which is about 30 percent of renewable water availability. This study analyzes the likely effects of increased competition for water resources and changes in the Turkish economy. The analysis uses an economy-wide Walrasian Computable General Equilibrium model with a detailed account of the agricultural sector. The study investigated the economy-wide effects of two external shocks, namely a permanent increase in the world prices of agricultural commodities and climate change, along with the impact of the domestic reallocation of water between agricultural and non-agricultural uses. It was also recognized that because of spatial heterogeneity of the climate, the simulated scenarios have differential impact on the agricultural production and hence on the allocation of factors of production including water. The greatest effects on major macroeconomic indicators occur in the climate change simulations. As a result of the transfer of water from rural to urban areas, overall production of all crops declines. Although production on rainfed land increases, production on irrigated land declines, most notably the production of maize and fruits. The decrease in agricultural production, coupled with the domestic price increase, is further reflected in net trade. Agricultural imports increase with a greater decline in agricultural exports.Computable General Equilibrium; Feedback links; Irrigation Water; Turkey