Abstract:

Purpose: Using time series analysis techniques, this study examines the link between economic growth and total factor productivity in the Turkish economy during the years 1971 through 2019. Methodology: Taking into account the outcomes of the unit root test, the ARDL bounds test is used to examine the long-term relationships between the series that are not stationary at the level. The dynamic interactions between the series are also investigated using the Toda and Yamamoto (1995) causality test. Findings: According to the cointegration test results, a long-term relationship has been found between the series. Long-term coefficient results show that a 1% increase in total factor productivity increases economic growth by approximately 3%. The causality test results reveal a one-way causality relationship from total factor productivity to growth. Findings show that total factor productivity has positive effects on economic growth in the Turkish economy for the period under review. Originality: Structural breaks created by the economic and political crises that emerged during the period under review were examined with economic methods that model these breaks. The study contributes to the literature by comprehensively discussing the dynamic relationships between growth and total factor productivity in the Turkish economy.

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