Abstract:

One of the most crucial elements for macroeconomics is the public sector. It is an important issue that is investigated by all countries whether public expenditures are effective or not. In the study, it is aimed to investigate the effects of public expenditures in the Turkish economy on unemployment rates for the period of 1980-2020. Within the scope of the research, unit root test based on Fourier functions is conducted to test the stationarity of the variables of public expenditures and unemployment rates. According to the Fourier KPSS unit root test, it is concluded that the variables of public expenditures and unemployment rate are not stationary at the level but are stationary in the first order. After determining that the trigonometric terms in the model are statistically significant, Tsong, Leei Tsai and Hu (2016) Fourier Cointegration test is applied to determine the relationships between the variables. According to the results of the study, it is determined that the increase and decrease in public expenditures and unemployment rates in Türkiye affect each other. The effect can be expressed as a 1 unit increase on unemployment rate, increases the public expenditures by 0.38 unit.

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