Testing Kaldor’s Growth Laws for Turkey: New Evidence from Symmetric and Asymmetric Causality Methods

Yıl 2020, Cilt: 10 Sayı: 2, 713 - 729, 25.12.2020

Uğur Korkut Pata , Hilmi Zengin

https://doi.org/10.18074/ckuiibfd.625455

Cited By: 1

Öz

Nicholas
Kaldor’s main contribution to economic theory was his work on industry-based
growth model. Kaldor’s laws examine the relationship between the industrial
sector, economic growth and labor productivity. This paper aims to test the
validity of Kaldor’s first and second (Kaldor-Verdoorn’s)
law using symmetric Toda and Yamamoto (1995); Hacker and Hatemi-J (2006) and
asymmetric Hatemi-J (2012) causality methods for Turkey covering the period of
1980-2014. According to the results of the symmetric causality tests, Kaldor’s
first and second law are valid for Turkey. Toda-Yamamoto causality analysis
shows that industry value added have a positive effect on both economic growth
and labor productivity in the industrial sector. The asymmetric causality test
results indicate that Kaldor’s first law holds in Turkey; however,
Kaldor-Verdoorn’s law is invalid. These results show that development in the
industrial sector promotes economic growth.

Anahtar Kelimeler

Kaldor’s Laws, Industrialization, Productivity, Asymmetric Causality Test

Kaldor Yasalarının Türkiye için Testi: Simetrik ve Asimetrik Nedensellik Yöntemleri ile Yeni Bulgular

Öz

Nikolas Kaldor’un iktisat teorisine temel katkısı sanayiye dayalı büyüme
modelidir. Kaldor yasaları sanayi sektörü, ekonomik büyüme ve işgücü
verimliliği arasındaki ilişkileri incelemektedir. Bu çalışma Türkiye için
1980-2014 döneminde Kaldor’un birinci ve ikinci (Kaldor-Verdoorn) yasasının geçerliliğini, simetrik; Toda ve Yamamoto
(1995), Hacker ve Hatemi-J (2006) ve asimetrik; Hatemi-J (2012) nedensellik
yöntemleri kullanarak test etmeyi amaçlamaktadır. Simetrik nedensellik
testlerinin sonuçlarına göre Kaldor’un birinci ve ikinci yasası Türkiye için
geçerlidir. Toda-Yamamoto nedensellik analizi sanayi sektöründe yaratılan katma
değerin hem ekonomik büyüme hem de sanayi sektöründeki işgücü verimliliği
üzerinde pozitif bir etkiye sahip olduğunu göstermektedir. Asimetrik
nedensellik testinin bulguları ise Kaldor’un ilk yasasının geçerli olduğunu
ancak ikinci yasasının geçerli olmadığını belirtmektedir. Bu bulgular sanayi
sektöründeki gelişmenin ekonomik büyümeyi desteklediğini göstermektedir.

Anahtar Kelimeler

Kaldor Yasaları, Sanayileşme, Verimlilik, Asimetrik Nedensellik Testi

Kaynakça

• Almosabbeh, I.A. and Almoree, M.A. (2018). The Relationship between Manufacturing Production and Economic Growth in the Kingdom of Saudi Arabia. Journal of Economic Studies, 45(4), 674–690.
• Atesoglu, H.S. (1993). Manufacturing and Economic Growth in the United States. Applied Economics, 25(1), 67–69.
• Bairam, E. (1991). Economic Growth and Kaldor's Law: The Case of Turkey, 1925–78. Applied Economics, 23(8), 1277–1280.
• Brown, R. L., Durbin, J. and Evans, J. M. (1975). Techniques for Testing the Constancy of Regression Relationships over Time. Journal of the Royal Statistical Society, 37(2), 149–192.
• Cripps, T. F. and Tarling, R. J. (1973). Growth in Advanced Capitalist Economies 1950–1970. Cambridge: Cambridge University Press.
• Cetin, M. (2009). Kaldor Buyume Yasasinin Ampirik Analizi: Turkiye ve AB Ulkeleri Ornegi (1981-2007). Afyon Kocatepe Universitesi İ.İ.B.F. Dergisi, 11(1), 355–373.
• Drakopoulos, S. A. and Theodossiou, I. (1991). Kaldorian Approach to Greek Economic Growth. Applied Economics, 23(10), 1683–1689.
• Doruk, Ö. T, Kardaşlar, A. and Kandır E. D. (2013). Turkish Economy’s Great Transformation: Industry, Agriculture and Economic Growth in the Process After 1980: A Review from the Perspective of Kaldor's First Growth Law. The Empirical Economics Letters, 12(6), 587–592.
• Efron, B. (1979). Bootstrap Methods: Another Look at the Jackknife. Annals of Statistics, 7(1), 1–26.
• Granger, C. W. (1969). Investigating Causal Relations by Econometric Models and Cross-Spectral Methods. Econometrica: Journal of the Econometric Society, 37(3), 424–438.
• Granger, C. W. and Yoon G. (2002). Hidden Cointegration, U of California, Economics Working Paper (2002-02). https://papers.ssrn.com/sol3/papers.cfm?abstract_id=313831 (Accessed date: 20.09.2019).
• Hacker, R. S. and Hatemi-J, A. (2006). Tests for Causality between Integrated Variables Using Asymptotic and Bootstrap Distributions: Theory and Application. Applied Economics, 38(13), 1489–1500.
• Hatemi-J, A. (2003). A New Method to Choose Optimal Lag Order in Stable and Unstable VAR Models. Applied Economics Letters, 10(3), 135–137.
• Hatemi-J, A. (2012). Asymmetric Causality Tests with an Application. Empirical Economics, 43(1), 447–456.
• McCombie, J. S. and De Ridder, J. R. (1983). Kaldor’s Growth Laws: Increasing Returns, Productivity, and Output Growth, The Case of The United States. Journal of Post Keynesian Economics, 5(3), 373–388.
• Millin, M. and Nichola, T. (2005). Explaining Economic Growth in South Africa: A Kaldorian Approach. International Journal of Technology Management & Sustainable Development, 4(1), 47–62.
• Kaldor, N. (1957). A Model of Economic Growth. The Economic Journal, 67(268), 591–624.
• Kaldor, N. (1966). Causes of the Slow Rate of Economic Growth of the United Kingdom: An Inaugural Lecture. Cambridge: Cambridge University Press.
• Kaldor, N. (1975). Economic Growth and the Verdoorn Law--A Comment on Mr Rowthorn's Article. The Economic Journal, 85(340), 891–896.
• Kaldor, N. (1977). Capitalism and Industrial Development: Some Lessons from Britain's Experience. Cambridge Journal of Economics, 1(2), 193–204.
• Republic of Turkey Ministry of Development (2014). Decision on the Approval of the Tenth Development Plan (2014-2018). Ankara: Ministry of Development.
• Keho, Y. (2018). Manufacturing and Economic Growth in ECOWAS Countries: A Test of Kaldor’s First Law. Modern Economy, 9(5), 897–906.
• Lumsdaine, R. L. and Papell, D. H. (1997). Multiple Trend Breaks and the Unit-Root Hypothesis. Review of Economics and Statistics, 79(2), 212–218.
• Marconi, N., de Borja Reis, C. F. and de Araújo, E. C. (2016). Manufacturing and Economic Development: The Actuality of Kaldor's First and Second Laws. Structural Change and Economic Dynamics, 37, 75–89.
• McCausland, W. D. and Theodossiou, I. (2012). Is Manufacturing Still the Engine of Growth?. Journal of Post Keynesian Economics, 35(1), 79–92.
• Necmi, S. (1999). Kaldor’s Growth Analysis Revisited. Applied Economics, 31(5), 653–660.
• Opoku, E. E. O. and Yan, I. K. M. (2019). Industrialization as Driver of Sustainable Economic Growth in Africa. The Journal of International Trade & Economic Development, 28(1), 30–56.
• Rowthorn, R. E. (1975). What Remains of Kaldor's Law?. The Economic Journal, 85(337), 10–19.
• Stoneman, P. (1979). Kaldor's Law and British Economic Growth: 1800–1970. Applied Economics, 11(3), 309–319.
• Tekeli, I. (2010). Sanayi Toplumu Icin Sanayi Yazilari. Istanbul: Tarih Vakfi Yurt Yayinlari.
• Terzi, H. and Oltulular, S. (2004). Causal Relationship between Industrialization and Economic Growth in Turkey. Dogus University Journal, 5(2), 219–226.
• Thirlwall, A. P. (1983). A Plain Man’s Guide to Kaldor’s Growth Laws. Journal of Post Keynesian Economics, 5(3), 345–358.
• Toda, H. Y. and Yamamoto, T. (1995). Statistical Inferences in Vector Autoregressions with Possibly Integrated Processes. Journal of Econometrics, 66(1), 225–250.
• TurkStat, (2014). Statistical Indicators 1923-2013. Ankara: Turkish Statistical Institute.
• Wells, H. and Thirlwall, A. P. (2003). Testing Kaldor's Growth Laws across the Countries of Africa. African Development Review, 15(2), 89–105.
• Zivot, E. and Andrews, D. (1992). Further Evidence of Great Crash, the Oil Price Shock and Unit Root Hypothesis, Journal of Business and Economic Statistics, 10(3), 251–270.