Panel Econometric Analysis of The Effect of Economic Freedom on Economic Growth in New Industrialized Countries

İlyas Bayar

Article Details

Panel Econometric Analysis of The Effect of Economic Freedom on Economic Growth in New Industrialized Countries

Authors:

İlyas Bayar

Publisher:

Bingol University

Main Topics:

Ekonomi

Journal:

Bingöl Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi Vol.7 Issue Prof. Dr. Muammer ERDOĞAN Anısına Kongre Özel Sayısı, pp.35-62

Document Type:

Article

Publication Date:

3/2023

Document Language:

Turkish

Document ID (Org No.):

2001286912

pISSN:

2651-3234

Keywords:

Abstract:

 In the first quarter of the twentieth-first century, two global economic crises were experienced. After 2008 global crisis and Covid-19 pandemic taken the monetary, fiscal and macroprudential measures increased the states intervention in the economy. With the increasing public expenditures, the economic size of the state has increased and policies to increase international trade barriers have begun to be discussed. This situation paved the way for a re-examination of the effect of free market economy and economic freedom, which is one of the determinants of economic welfare, on economic growth. For this purpose, the aim of the study is to analyze the effect of economic freedom on economic growth between 2000-2020 in 10 Newly Industrialized Countries Brazil, China, India, Indonesia, Malaysia, Mexico, Philippines, South Africa, Thailand, Turkey by means of new generation econometric methods. Since cross-sectional dependence was detected in the model and variables, panel unit root and cointegration tests were carried out with second generation tests. A cointegration relationship was found between the variables. With the help of the CCE cointegration estimator, it was concluded that the economic freedom and gross fixed capital formation increases economic growth. By providing economic freedom, low taxation and private property security, economic actors increases their willingness to work and investment desires. In this context, the study reveals that policies that increase economic freedom for the purpose of growth should be supported.

 In the first quarter of the twentieth-first century, two global economic crises were experienced. After 2008 global crisis and Covid-19 pandemic taken the monetary, fiscal and macroprudential measures increased the states intervention in the economy. With the increasing public expenditures, the economic size of the state has increased and policies to increase international trade barriers have begun to be discussed. This situation paved the way for a re-examination of the effect of free market economy and economic freedom, which is one of the determinants of economic welfare, on economic growth. For this purpose, the aim of the study is to analyze the effect of economic freedom on economic growth between 2000-2020 in 10 Newly Industrialized Countries Brazil, China, India, Indonesia, Malaysia, Mexico, Philippines, South Africa, Thailand, Turkey by means of new generation econometric methods. Since cross-sectional dependence was detected in the model and variables, panel unit root and cointegration tests were carried out with second generation tests. A cointegration relationship was found between the variables. With the help of the CCE cointegration estimator, it was concluded that the economic freedom and gross fixed capital formation increases economic growth. By providing economic freedom, low taxation and private property security, economic actors increases their willingness to work and investment desires. In this context, the study reveals that policies that increase economic freedom for the purpose of growth should be supported.

 In the first quarter of the twentieth-first century, two global economic crises were experienced. After 2008 global crisis and Covid-19 pandemic taken the monetary, fiscal and macroprudential measures increased the states intervention in the economy. With the increasing public expenditures, the economic size of the state has increased and policies to increase international trade barriers have begun to be discussed. This situation paved the way for a re-examination of the effect of free market economy and economic freedom, which is one of the determinants of economic welfare, on economic growth. For this purpose, the aim of the study is to analyze the effect of economic freedom on economic growth between 2000-2020 in 10 Newly Industrialized Countries Brazil, China, India, Indonesia, Malaysia, Mexico, Philippines, South Africa, Thailand, Turkey by means of new generation econometric methods. Since cross-sectional dependence was detected in the model and variables, panel unit root and cointegration tests were carried out with second generation tests. A cointegration relationship was found between the variables. With the help of the CCE cointegration estimator, it was concluded that the economic freedom and gross fixed capital formation increases economic growth. By providing economic freedom, low taxation and private property security, economic actors increases their willingness to work and investment desires. In this context, the study reveals that policies that increase economic freedom for the purpose of growth should be supported.

 Yirminci birinci yüzyılın ilk çeyreğinde küresel ölçekte iki ekonomik kriz yaşanmıştır. Gerek 2008-2009 küresel iktisadi kriz gerekse de Covid-19 pandemisi sonrası alınan para, maliye ve makro ihtiyati tedbirler devletin ekonomiye müdahalesini arttırmıştır. Artan kamu harcamaları ile devletin ekonomik büyüklüğü artmış ve uluslararası ticaret engellerinin artırılmasına yönelik politikalar tartışılmaya başlanmıştır. Bu durum, serbest piyasa ekonomisinin ve dolayısıyla ekonomik refahın belirleyicilerden biri olan ekonomik özgürlüğün iktisadi büyüme üzerindeki etkisinin yeniden incelenmesine zemin hazırlamıştır. Bu amaçla çalışmada, yeni sanayileşen 10 ülkede Brezilya, Çin, Hindistan, Endonezya, Malezya, Meksika, Filipinler, Güney Afrika, Tayland, Türkiye 2000-2020 dönemleri arasında ekonomik özgürlüğün ekonomik büyüme üzerindeki etkisi yeni nesil ekonometrik yöntemler vasıtasıyla analiz edilmiştir. Modelde ve değişkenlerde yatay kesit bağımlılığı belirlendikten sonra ikinci nesil testlerle panel birim kök ve eşbütünleşme sınaması yapılmıştır. Değişkenler arasında eşbütünleşme ilişkisi tespit edilmiştir. Yapılan CCE eşbütünleşme tahmincisi yardımıyla ekonomik özgürlüğün ve gayri safi sabit sermaye oluşumunun ekonomik büyümeyi arttırdığı görülmüştür. Ekonomik özgürlük, düşük vergilendirme ve özel mülkiyet güvencesi sağlayarak iktisadi aktörlerin çalışma isteklerini ve yatırım arzularını artırmaktadır. Bu çerçevede, mevcut çalışma büyüme amacına dönük olarak ekonomik özgürlüğü artıran politikaların desteklenmesi gerektiğini ortaya koymaktadır.

Article Details

Panel Econometric Analysis of The Effect of Economic Freedom on Economic Growth in New Industrialized Countries

Authors:

İlyas Bayar

Publisher:

Bingol University

Main Topics:

Ekonomi

Journal:

Bingöl Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi Vol.7 Issue Prof. Dr. Muammer ERDOĞAN Anısına Kongre Özel Sayısı, pp.35-62

Document Type:

Article

Publication Date:

3/2023

Document Language:

Turkish

Document ID (Org No.):

2001286912

pISSN:

2651-3234

Economic freedom

economic growth

panel data analysis

panel CCE

Ekonomik özgürlük

ekonomik büyüme

panel veri analizi

panel CCE

Issues

Article Details

Authors: İlyas Bayar

Publisher: Bingol University

Main Topics: Ekonomi

Journal: Bingöl Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi Vol.7 Issue Prof. Dr. Muammer ERDOĞAN Anısına Kongre Özel Sayısı, pp.35-62

Document Type: Article

Publication Date: 3/2023

Document Language: Turkish

Document ID (Org No.): 2001286912

pISSN: 2651-3234

Issues

Authors:

İlyas Bayar

Publisher:

Bingol University

Main Topics:

Ekonomi

Journal:

Bingöl Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi Vol.7 Issue Prof. Dr. Muammer ERDOĞAN Anısına Kongre Özel Sayısı, pp.35-62

Document Type:

Article

Publication Date:

3/2023

Document Language:

Turkish

Document ID (Org No.):

2001286912

pISSN:

2651-3234