Analysis of Foreign Debt and Economic Growth in Turkey by Using Core Regression

Abstract

The duration and volume of foreign indebting bear an important issue for every economy no matter how developed it is. Foreign indebting, which is applied when domestic savings can not meet the planned investments, causes different results based on the economic structures and the way that they use these funds. This study investigates the relationship between foreign debt and economic growth for Turkish economy using core regression method. The data have been obtained from the statistics database of World Bank for the years 1970 to 2013 annually. Existing data reveals that 1 unit increase in foreign debt of Turkey decreases economic growth at about 0,12