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The study empirically examines the impact of armed conflict on population growth in Eastern Turkey. The empirical findings confirm the implications of the theoretical model in the body of the paper. The results indicate that PKK recruitment leads to depopulation at the district level while increases rural population growth. Moreover, the results indicate that the number of killed PKK militants in the province to which a district belongs negatively affects population growth at the district level. On the other hand, the results also indicate that number of killed PKK militants does not significantly affect the population growth at the district level while decreases rural population growth. The results show that the percentage of valid votes to registered voters increases the population growth at the district level. [ABSTRACT FROM AUTHOR]

Net profits of state-run chance games are either earmarked for non-defence 'good causes' or added to the public purse in international practice. The Turkish case is unique as 95% of profits were earmarked for the extrabudgetary Defence Industry Support Fund (DISF) by legislation during 1986–2007. The DISF administers security equipment procurement and domestic arms production in Turkey. The earmarking practice was dissolved in 2007 and chance game profits are transferred to the general budget. The incomings of the DISF are from the budget and from earmarked taxes from 2007 onwards. The purpose of this paper is to investigate the effect of these practices on chance game sales for the period 1986–2017. Noting that a chance game is a joint public-private good, participation is motivated by expectations for private gain but at the same time loss is legitimised by expectations for provision of public services with the takeout part. In order to gain insight into the societal motives in chance game participation in Turkey our model is defined in the context of private (consumerism) cum public (security, warfare) interest. The VECM estimates support a long-run relationship between chance game sales and security variables. [ABSTRACT FROM AUTHOR]

When governments' ability to maintain power is threatened, they use any tool at their disposal to re-establish or boost their survival. In this paper, we theorize dyadic strategic choices and interactions between governments and domestic terrorist groups in times of economic turmoil. We contend that governments are more likely to increase their targeting of domestic terrorist groups, which provides legitimate opportunities to divert public attention from economic concerns and rally individuals around the flag. Meanwhile, observing such incentives, domestic terrorist groups make strategic decisions similar to those of interstate actors by either decreasing their attacks (strategic conflict avoidance) or increasing them (strategic conflict seeking) to add an inability to provide safety and security to the government's existing struggles. We test these competing hypotheses by leveraging two recently released event datasets focusing on the Turkey-PKK conflict. Our findings contribute to the terrorism studies literature on decision-making and strategic choices, and broader scholarship about conflict processes by testing conflict dynamics at the domestic level. [ABSTRACT FROM AUTHOR]

This paper employs a wavelet approach to investigate the relationship between economic growth and military spending in a time-frequency domain for the case of Turkey. Turkey presents an interesting case for analysis of military spending and economic growth, as its geopolitical position and history of insurgencies and separatist violence oblige the country to devote an unusually large share of the central government budget to national defence. Timescale regression analysis reveals that military expenditures have significant negative effects on growth in per capita GDP at business cycles of 16 years and longer. Timescale Granger causality analysis indicates that per capita GDP growth responds to movements in military expenditures at business cycles of eight years and above and that this result is very significant. Wavelet coherency analysis corroborates these findings, indicating a significant negative long-run co-movement at business cycles of 16 years and longer. Thus, the neoclassical prediction that military spending may promote growth does not hold in the case of Turkey, at least in the long run. Furthermore, the analysis reveals that, in the long run, military spending has been leading rather than lagging economic growth. [ABSTRACT FROM AUTHOR]

The economic growth effects of military expenditure have been the subject of a large literature in defence economics. Theories on the economic impacts of military expenditure greatly differ and include arguments that they either enhance economic growth or crowd out productive investments. Empirical literature on defence expenditure and economic growth nexus generally employs linear specifications to investigate the impact of defence expenditures on economic growth. Although it is now well established that many economic variables may have a non-linear data-generating mechanism, it seems that this reality has long been neglected in empirical work on defence–growth nexus. This paper attempts to fill this gap by employing non-linear panel data models to examine the effects of military expenditures on economic growth for Middle Eastern countries and Turkey, for the time period 1988–2012. Results show that the effect of military expenditure on economic growth is nonlinear such that the state of the economy actually determines the effect of the former on the latter. This is important not only in showing asymmetric relationship between these variables but also in revealing the reasons of mixed results of earlier literature. [ABSTRACT FROM AUTHOR]

This paper examines the relationship between defence spending and income inequality in Turkey for the period of 1963–2007. Using the Theil Index of pay inequality as a proxy of overall income distribution, this study overcomes the problem of lack of time series data. Utilizing basic cointegration and causality tests, the paper aims to add to the literature by providing evidence that defence spending has an impact on income inequality for the case of Turkey. [ABSTRACT FROM PUBLISHER]

This paper looks into the Greek-Turkish arms race a decade after an earlier contribution to the issue that relied heavily on artificial neural networks. The time period between the two papers contributes to the reliability of the results derived, not just by increasing the number of observations, but also mainly by incorporating the progress made in the realm of artificial intelligence. The focus on the case of both countries unlike the paper mentioned above that dealt with just the Greek side provides ample room for comparative purposes regarding the determinants of defense expenditure on both sides. The results derived in terms of input significance estimation support the findings of the earlier research as indicated above, pointing to the leading role of the demographic preponderance of Turkey over Greece. The paper also points to the fact that 10 years later, Turkey continues to set the arms race rules against its rival by determining the defense expenditure of Greece, whereas the role of the latter in affecting the military spending of Turkey is non-existent. [ABSTRACT FROM AUTHOR]

This paper uses linear and non-linear Granger causality methods to determine the causal relationship between defense spending and economic growth in Turkey for the period 1949-2004. The innovative feature of this paper is that it provides evidence regarding the nonlinear causal dependence between military spending and economic growth in Turkey. The empirical results contribute to the empirical literature by indicating support for both linear and non-linear causality between military expenditures and economic development and they may prove useful in theoretical and empirical research by regulators and policy makers. [ABSTRACT FROM AUTHOR]

The ongoing Turkish-Greek antagonism has triggered the interest of defense economists to investigate the various aspects of the arms race between Turkey and Greece. However, empirical studies examining the long-run relationship between the military expenditures of the two countries offer little evidence in favor of such an interaction. This paper attributes the poor results of the previous literature to the adherence to linear cointegration techniques and argues that if the adjustment towards long-run equilibrium is asymmetric, nonlinear co-integration models should be employed. Accordingly, this paper considers threshold autoregressive (TAR) and momentum threshold autoregressive (M-TAR) models as alternative adjustment processes for the cointegration relationship, following Enders and Siklos (2001). The results indicate that the relationship between the variables can be characterized by a threshold cointegration specification following an M-TAR type adjustment process. [ABSTRACT FROM AUTHOR]

This paper empirically investigates the importance of financial and political variables in determining debt rescheduling probabilities in Turkey for 1955-2000. The problem of sovereign debt default and rescheduling has been the subject of substantial academic research during the last two decades. There has been criticism of models of developing countries' indebtedness and rescheduling that rely solely on some economic or financial predictors related to country debt, the foreign exchange sector or the domestic economic situation. Using probit analysis, this paper indicates that financial variables are important determinants of rescheduling probabilities. However, political variables are not significant in our models. [ABSTRACT FROM AUTHOR]

This scope of this paper is to forecast the extent to which a settlement of the Cyprus issue may be possible given the decisions taken during the Copenhagen EU summit. It aims, in addition, at investigating the possibilities of improvement in Greek-Turkish relations which may lead, in turn, to reducing the arms race between the two countries. The paper uses a Genetically Evolved Certainty Neuron Fuzzy Cognitive algorithm to consider a number of scenarios examining the possible reactions of all sides involved in the Cyprus issue, namely Greece, Turkey, Cyprus, the Turkish-Cypriot community that the international environment. All simulation exercises suggest that the Greek and the Cypriot side should not necessarily rely on the decisions taken during the Copenhagen summit conference. The forecasts point out, in addition, that the optimism of the Greek government concerning the outlook of its relations with Turkey, and a subsequent reduction of the arms race against it, is far from being justified. [ABSTRACT FROM AUTHOR]

Uprising tensions during 2010 in eastern and southeastern regions of Turkey provoked arguments about the necessity for a State of Emergency (SOE; ‘Olağanüstü Hal’ in Turkish) declaration in those regions, with a belief of enduring political sustainability. The discussion is inflamed by a speech of the Nationalist Movement Party’s leader about the suggestion to announce a SOE ruling after the death of 24 Turkish soldiers in Hakkari (a city in the southeast of Turkey) in an attack of the PKK (Kurdistan Workers’ Party) on the 19 October 2011. Although a new announcement of SOE did not take place, the discussion itself induced the idea behind this paper which is to provide a quantitative analysis of the SOE in Turkey. In fact, the SOE ruling is not a new concept for Turkey and it has been implemented in 13 cities in the eastern and southeastern regions from 1987 to 2002. Although there have been many discussions about the costs of these 15 years of the SOE ruling in terms of military expenditure and, thus, on the national budget, there is a lack of quantitative analytical examination of the economic and social costs of it. Difference-in-differences analysis reveals negative spillover impacts of the SOE, especially on the forced migration, unemployment, and educational investments. The results also show that SOE ruling is an important factor for the underdevelopment of the eastern and southeastern regions in Turkey and, thus, a new SOE will bring enormous inequalities, both economically and socially, and an intensification of the ethnic tensions in Turkey. [ABSTRACT FROM PUBLISHER]

This paper investigates the determinants of provincial terrorism in Turkey taking spatial dimension into account for the time period 1990–2006. Following a traditional global regression analysis, spatial variations in the relationships are examined with geographically weighted regression (GWR) to obtain locally different parameter estimates. Empirical results indicate that increases in income and schooling ratio tend to reduce the provincial average level of terrorism, whereas an increase in unemployment enhances it. Moreover, GWR results indicate that the provincial effects of per capita income and education are more pronounced for the Eastern and South Eastern provinces compared to the Western provinces. [ABSTRACT FROM AUTHOR]

This paper investigates the economic roots of separatist terrorism in Turkey. The political conventional wisdom is that poverty in highly Kurdish-populated, south-eastern Turkey is one of the most important causes of separatist terrorism and Turkish-Kurdish conflict in Turkey. Therefore, many economic policies have been implemented to improve the economic conditions in the south-eastern part of the country. Using the Global Terrorism Database and Vector Autoregression (VAR) methodology, I find that there is no causal relationship between economic conditions in south-eastern Turkey and separatist terrorism. Therefore policy-makers should be cautious in using economic measures to prevent separatist terrorism in Turkey. [ABSTRACT FROM AUTHOR]

Using a time series method called 'transfer function', this paper examines the effect of terrorism on tourism in Turkey. The results indicate that there exists a negative but small impact of terrorism, which is observed within approximately one year. However, terrorist attacks in Turkey have accounted for a reduction of six million foreign tourists over the last nine years. Moreover, the economic cost of terrorism in the tourism industry was more than $700 million in 2006. However, terrorist attacks in continental Europe and America, and an active war involving a neighboring country, had no effects on tourism in Turkey. [ABSTRACT FROM AUTHOR]

This paper examines the peace dividend effect of Turkish convergence to EU membership. By employing a multi-region dynamic CGE model, we examine the prospect for conflict resolution if Turkey becomes an EU member. The model allows us to analyse several scenarios that imply varying amounts of reduction of the military expenditure/GDP ratios. On the one hand, this change will cause a decrease in sectoral demand for military expenditures, while on the other hand, reallocation of the reduced expenditure on (i) education, (ii) tax decrease, and (iii) infrastructure, should have a huge growth impact. Our dynamic CGE simulation experiments emphasize the economic gain for all parties involved. [ABSTRACT FROM AUTHOR]

This paper investigates the macroeconomic effects of terror by using a novel data set from Turkey for the period of 1987:1 to 2004:4. This research contributes to the literature by controlling for the possible non-linear and endogenous relationship between political conflict and economic activity. Empirical evidence from both linear and non-linear models confirms that terrorism has a large significant negative impact on economic activity. Finally, the results from the non-linear model show that the impact of terrorism on the aggregate economy is more severe during expansionary periods, and that the impact of economic activity on terrorism is significant only in recessionary periods. [ABSTRACT FROM AUTHOR]

This paper investigates the relationship between external debt, defence expenditures and political business cycles in Turkey for 1960-2002. Here, two important aspects of the political business cycle, the electoral effects and the partisan effects, were investigated. The empirical finding of impulse response functions of defence expenditures to a shock in the partisan effect is positive. The results reported here indicate that political colours of parties appear to be important. This suggests that defence expenditure is influenced by political ideology and the fiscal policy of governments after elections. Moreover, the impulse response functions of external debt stock to shocks to the electoral effects and the response of external debt stock shocks to the partisan effects increased over the whole period. [ABSTRACT FROM AUTHOR]

This paper analyzes the relationship between government budget deficits, defence expenditure and income redistribution among different social-income groups in Turkey for the period 1965-2003. The analysis was based on a five-equation vector auto regressive (VAR) model and impulse response functions (IRFs) derived from the VAR model. The study finds that the deficit as a percentage of GNP has a negative and significant impact on transfer payments as a percentage of GNP. The IRFs indicate that shocks to deficit expenditures as a percentage of GNP (DEFGNP) have statistically significant impacts on defence spending as a percentage of GNP (DSGNP), educational expenditures as a percentage of GNP (EDGNP), health expenditures as a percentage of GNP (HEGNP), and transfer payments as a percentage of GNP (TPGNP). The results derived from this study also indicate that there is a positive and significant relationship between defence spending as a percentage of GNP and deficits as a percentage of GNP. Therefore, defence spending is viewed as a tool for transferring income among different social-income groups and across generations in Turkey for the period 1965-2004. As a result of this, the government can use deficit and defence spending as one of the major instruments to transfer income among different social-income groups and across generations in Turkey. [ABSTRACT FROM AUTHOR]

The new strategic environment that was created with the end of the Cold War, led many European countries to abolish conscription and adopt an all volunteer force (AVF). Even though it is not likely for the Turkish Armed Forces to adopt an AVF in the near future, the issue has been in the official documents of the Turkish Armed Forces since the 1990s. Thus, efforts have been made by all services to increase the ratio of professional officers. One possible way of achieving this is the re-enlistment of present recruits. This paper examines the possible economic and socio-economic determinants of the re-enlistment decision of recruits for Turkey's Armed Forces. The empirical findings indicate that the geographical background as well as economic welfare is influential in the re-enlistment decision. [ABSTRACT FROM AUTHOR]

This paper extends the Looney and Frederiksen (1986) study and investigates the relationship among external debt, defence expenditures and GNP in Turkey for 1960–2002. After applying cointegration analysis of a multivariate system of equations, impulse response functions and variance decomposition are estimated. The impulse response functions indicate that defence expenditures have a positive effect on external debt stock. Moreover, impulse response of GNP to defence expenditures tended to hike slightly within two years ahead, and dipped sharply by two years, and thereafter continued at a positive level. [ABSTRACT FROM AUTHOR]

Defence expenditures have both costs and benefits to the economy. The costs of defence expenditures are mainly emphasized as opportunity costs. On the other hand, defence spending may have growth‐promoting potential benefits: a rise in defence spending may result in a higher aggregate demand, production and employment. This paper examines empirically the effects of military expenditures on economic growth for Middle Eastern countries and Turkey, for the time‐period 1989–1999. The relationship between military expenditure and economic growth is investigated by using cross‐section and dynamic panel estimation techniques. Empirical analysis indicates that military expenditure enhances economic growth in the Middle Eastern countries and Turkey as a whole. [ABSTRACT FROM AUTHOR]

This paper investigates a series of unit root, cointegration and causality tests to ascertain the direction of causality between the growth of GNP and defence expenditure in Turkey for the years 1955-2000. The main conclusion is that there is a long-run equilibrium relationship between GNP and defence expenditures. Furthermore, the short run causality test indicates that there is a unidirectional causality between variables, from defence expenditure to economic growth. In order to see the effect of a shock, we employed impulse response analyses. The results show that GNP decreased during the period then output finally recovered from the initial shock to defence expenditures. [ABSTRACT FROM AUTHOR]

The article discusses several papers published within the issue including one about the impact of defense spending on Turkey's macroeconomic variables and another regarding the arms race between Greece and Turkey.