Beyond the Structural Change: Does Technology Obsolescence Effect Exist in the Economy of Turkey?

Abdullah Önden; Alnour Mohammed

doi:10.31181/jscda21202427

Authors

Abdullah Önden Department of International Trade and Finance, Yalova University, Turkey Author https://orcid.org/0000-0003-3769-8193
Alnour Mohammed Department of Economics, Institute of Social Sciences, Erciyes University, Turkey Author https://orcid.org/0000-0003-3276-7380

DOI:

https://doi.org/10.31181/jscda21202427

Keywords:

Public R&D expenditure, EKC, Population growth, GDP, ARDL, Decision making

Abstract

The implications of economic activities on the quality of environment have gained a long theoretical and empirical debate among scholars and decision-makers, using perhaps the most sophisticated analytical techniques, however, no consensus is yet to be reached on a specific pattern of the relations. Deviating from the attendant literature, this study conducts a comprehensive empirical investigation for the relationship between economic growth and environmental quality for Turkey using a cubic polynomial function under the framework of extended form of EKC hypothesis. The study employed Autoregressive Distributed Lag model for the annual data extending the period 1996-2022. The findings reveal that the relationship between economic growth (GDP) and environmental quality is inverted N-shaped. Additionally, the results uncover that public expenditure on research and development (R&D) has no reliable power to explain the variation in environmental quality, while the population growth rate contributes to reducing pollution. Among numerous policy suggestions, the study recommends that an expansion in green investment can increase the effectiveness of sustainability policies, and financial sector can play a promising role through regulated expansion of domestic credit and bank credit to the private sector to promote the development and diffusion of environmentally sound technologies.

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