City and Regional Planning / Şehir ve Bölge Planlama
Permanent URI for this collectionhttps://hdl.handle.net/11147/4274
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Article Citation - WoS: 1Citation - Scopus: 1Socio-Economic and Development Disparities Over the Long-Run: Exploring Spatial Heterogeneities in the Case of Turkey(Hungarian Central Statistical Office, 2024) Duran, Hasan Engin; Cifci, Burcu Degerli; Karabakan, Berfin; Dogan, FehmiThe aim of this paper is to explore the evolution of socioeconomic development and income disparities and convergence patterns across Turkish provinces, emphasizing the impact of spatial heterogeneities. We propose two types of contributions to the literature. First, most of the studies that apply the 13- convergence method presume a unique 13 parameter, assuming that all regions homogenously converge to the steady state at the same pace. However, we argue that relaxing this assumption by way of considering spatial heterogeneities might be more informative. Second, we provide a simple solution to a severe problem: The neoclassical model assumes a monotonic saddle path along which economic fluctuations are not considered, which might be particularly influential with regard to convergence when the time span is too short to capture long-term evolution. Many empirical studies cover only short periods, which may be easily dominated by recessions or expansions, significantly biasing the results. To overcome this problem, we look into two datasets covering long periods (1963-2017 and 1975-2021). Having applied various empirical methods, such as spatial regressions, GWR and nonparametric regressions, we obtain several results. First, at the country level, there is empirical evidence of regional convergence and decreasing development inequalities. Second, however, this convergence process is not valid in all areas. We conclude that there is nonnegligible spatial heterogeneity that should be taken into account in such analyses.Article Citation - WoS: 12Citation - Scopus: 12Economic Resilience and Regionally Differentiated Cycles: Evidence From a Turning Point Approach in Italy(Wiley, 2023) Duran, Hasan Engin; Fratesi, UgoThe literature on regional resilience often neglects the timing of recessions and simply uses national cycles. Region-specific cycles and turning points might bias the results, however, and affect the choice of regions to target with policies. This paper investigates the geography and determinants of regional resilience with a regional turning point approach, using data for Italy, a country with a well-known and sizeable regional divide. The results show that the timing of regional cycles varies substantially and that the detected resilience determinants are different across the two approaches, implying that the policy levers may be wrongly estimated with national turning points.Article Citation - WoS: 3Citation - Scopus: 4Region-Specific Turning Points in Territorial Economic Resilience: a Business Cycle Approach To Turkey(Routledge, 2023) Duran, Hasan Engin; Elburz, Zeynep; Kourtit, Karima; Nijkamp, PeterAlmost all regional economic resilience studies measure resilience by referring to national time patterns of recessions. This study of region-specific patterns of resilience of 81 Turkish regions in the period 2009-20 and their underlying economic/demographic determinants in regions in Turkey shows that ignoring the different timings of regional and national economy recessions leads to misleading/biased results. The study shows first that provincial employment cycles are asynchronous. Second, the geographical pattern of resistance to the last 2018 economic crisis changes considerably when using province-specific rather than national turning points. Third, those provinces that are more open to trade, export- oriented, highly urbanised, and with a low level of human capital and entrepreneurial activities were more resistant to the recession.Article Citation - WoS: 8Citation - Scopus: 13Heterogenous Responses To Monetary Policy Regimes: a Regional Analysis for Turkey, 2009-2019(Hungarian Central Statistical Office, 2022) Duran, Hasan Engin; Karahasan, Burhan CanThe heterogeneous response of regions to interest rate shocks is a severe issue that reduces the effectiveness of monetary policy. While the impact of interest rate shocks is central on policymaking, less has been discussed about the spatial heterogeneity in influencing macroeconomic policy implementations. In order to fill this gap, the authors explore regional responses to monetary policy in developing countries, such as Turkey. The main aim of the paper is to investigate how different regions adjust the extent of real economic activity in response to an exogenous country-wide shock in the interest rate policy. The analyses cover 81 Turkish provinces using monthly data from January 2009 to November 2019. To consider temporal and spatial patterns in the same framework, time-series analyses via unit root, co-integration, and VAR with spatial methods have been combined, including exploratory spatial data analysis and spatial econometric models. Preliminary findings validate that regional economic activity measured by employment responses is heterogeneous across provinces and policy regimes. Among the different determinants in assessing responsiveness to monetary policy shocks, interest rate, broad credit channels, and certain regional demographics have explanatory power. Moreover, sizeable spatial spillovers have been detected, which are believed to be crucial in evaluating the externalities and the exact impact of the country-wide policy shock in Turkey. Combined results indicate that the macroeconomic policy impact and spatial externalities are visible only during monetary expansion periods.Article Citation - WoS: 8Citation - Scopus: 8Validity of Okun’s Law in a Spatially Dependent and Cyclical Asymmetric Context(Savez Ekonomista Vojvodine, 2022) Duran, Hasan EnginThe current article analyzes the validity of Okun’s Law and sizable distortions that can occur in the estimation when spatial dependence and cyclical asymmetric impacts are not considered, which is a concern commonly ignored by the existing literature. Primarily spatial panel regressions (SDM, SAR, and SEM) and nonparametric regressions along with specification tests are adopted in terms of the methodology (such as panel unit root tests, panel cointegration, Moran’s I and Geary’s C tests of global spatial dependence, spatial LM, and Hausman tests). Additionally, spatial heterogeneity and cross-regional variation in Okun’s Law are investigated by adopting geographically weighted regression, LISA (local indicators for spatial association), and local Geary’s C analysis. A panel of 26 Turkish NUTS-2 regions from 2004 to 2018 was analyzed. The results clearly revealed that failing to incorporate spatial proximity and asymmetric cycle impacts leads to the biased estimation of Okun’s coefficient, such that during the downswing years of the national economy, Okun’s Law holds robustly: unemployment increases quickly in response to a decline in output. In contrast, during upswing years, the size of Okun’s coefficient is relatively much lower. Moreover, spatial dependence and heterogeneity are sizably evident. Okun’s coefficient is demonstrated to vary significantly across regions that have different industrial and labor market characteristics. As a policy implication, it has been understood that the reduction of unemployment is more difficult than initially understood, as economic growth itself does not provide a solution during upswing periods. The necessary special and region-specific policies are discussed throughout the text.Article Citation - WoS: 8Citation - Scopus: 9The Distribution of City Sizes in Turkey: a Failure of Zipf's Law Due To Concavity(Wiley, 2021) Duran, Hasan Engin; Cieslik, AndrzejThe linearity of the distribution of city sizes is often assumed in the existing literature. Although different functional forms were tried, almost all of them impose a certain functional shape. In this study, we investigate the urban hierarchy and Zipf's law using data for 973 Turkish subprovincial cities in 2019. We contribute to the literature in several ways. We force no definite functional form to observe the natural shape and employ nonparametric and quadratic regressions. We incorporate formal procedures of spatial dependence in regression models. We demonstrate that the linear model overestimates the Pareto exponent for small cities and underestimates it for bigger cities. We show that city sizes are unevenly distributed in Turkey. The rank-size rule is not valid in Turkey, either above or below a certain city-size truncation level. Thus, the Pareto exponent estimated from the linear model is not a reliable indicator as quadratic regressions perform much better.Article Citation - WoS: 2Citation - Scopus: 2Regional Inflation Persistence in Turkey(John Wiley and Sons Inc., 2021) Duran, Hasan Engin; Dindaroğlu, BurakThe purpose of the current study is to investigate the degree of inflation persistence, its geographical variation, sources of cross-regional variation, and presence of geographical/sectoral aggregation bias in national monetary policy. Our data set covers 26 NUTS-2 level Turkish regions and monthly CPI inflation over the period 2003-2019. We first estimate the degree of regional inflation persistence by autoregressive regressions, check its robustness against the presence of structural breaks (by Bai-Perron's algorithm) and nonlinearities (by Markovian Regime Switching regressions). Second, we examine the possibility of geographical and sectoral aggregation bias. Third, we investigate the cross-regional determinants of inflation persistence by panel data analysis, employing hybrid-effects spatial panel regressions. We analyze the direct and indirect effects of the determinants and test for regional spillover effects. Three main results are obtained. First, estimated persistence degrees are heterogeneous across regions. The geographical pattern is empirically robust against structural breaks and nonlinearities. We find that inflation persistence is distributed in a spatially correlated manner. Second, when sectoral and regional aggregation bias is tested, only sectoral aggregation indicates a considerable level of bias. Third, we find that the presence of large firms in the region and a higher share of agricultural output in GDP leads to lower persistence, while an increased share of industrial output, and increased trade volume leads to higher inflation persistence. Moreover, we find spatial spillovers of price variability evident in regression analysis. From a policy standpoint, it is required that structural policy programs are targeted to maintain flexibility in the regions where persistence is high (i.e., providing market entry/exit, institutional quality, policy credibility, stimulation of SMEs). Moreover, sectors that have high persistence, such as Hotels and Restaurants (persistence degree 0.55) and Health Services (0.39) should be weighted more in CPI calculations.Article Citation - WoS: 9Citation - Scopus: 10Employment Volatility in Lagging and Advanced Regions: the Italian Case(Wiley, 2020) Duran, Hasan Engin; Fratesi, UgoThe presence of cycles characterizes all economic systems, but economic cycles have differentiated spatial impacts. Some regions have broader cycles with respect to the country, while others tend to be less responsive to shocks and hence have narrower cycles. Being exposed to broader cycles, that is, greater volatility, may increase the strain on a regional economic system. This paper investigates the different responsiveness to cyclical forces and volatility of regions in the long run. It does so by using quarterly employment data for the Nuts2 Italian regions over almost 40 years before and during the period 1978-2016. Explored in particular are the cross-regional variations in employment volatility and the reasons for the patterns observed, as well as whether they have changed the following different macroeconomic policy regimes. The paper identifies the break dates of different regimes, and these regime changes will be related to policy modifications, such as the implementation of the European Monetary Union. The determinants of this regional volatility appear to be quite stable, so that the changes in volatility are explained by how these determinants have changed overtime and how they are unevenly distributed in space. In particular, the lagging regions of the country suffer, in addition to lower production and income, from higher volatility due to a structure which is weaker and more unstable. Volatility can hence be an additional issue for lagging regions.Article Citation - Scopus: 3Structural Change and Output Volatility Reduction in Oecd Countries: Evidence of the Second Great Moderation(Springer Verlag, 2019) Duran, Hasan EnginIn this article, we provide new, novel evidence for a more recent structural break (in 2010) indicating a greater moderation of output volatility compared to the well-known break during the mid-1980s. The period of analysis runs from 1962Q2 to 2018Q3. It covers 26 OECD countries. In terms of methodology, it has mainly been used as the measures of conditional and unconditional volatility and procedures of structural break detection (Inclan–Tiao test and autoregressive conditional heteroscedasticity model). As a result, it has been found that output greatly stabilized following the structural break at 2010Q1 in the post-era of 2008/09 global financial crisis. Moreover, output stabilization is robustly evident for 24 (out of 26) OECD countries. From a political standpoint, it is implied that the Keynesian view may be influential in this moderation. Government expenditures and fiscal programs, regulations of financial markets against the sub-prime lending and limitations to trade of mortgage-backed securities might have been the main driver of stability. Rapid improvement of digitalization and technical productivity may be regarded as another relevant reason that might have contributed to the stabilization process. © 2019, The Author(s).Article Citation - WoS: 10Citation - Scopus: 10Determinants of Co-Movement and of Lead and Lag Behavior of Business Cycles in the Eurozone(Taylor and Francis Ltd., 2017) Duran, Hasan Engin; Ferreira-Lopes, AlexandraIn this paper we study business cycle correlations in the Eurozone and its determinants. Additionally, we also analyze the determinants of the lead and lag behavior of business cycles in the Eurozone. We explore the relevance, in the Eurozone context, using GDP and employment as the business cycle measures, of the determinants of business cycle synchronization identified in the literature, namely bilateral trade intensity, dissimilarity of labor market rigidity, dissimilarity in industrial structures, financial openness, and foreign direct investment relations. We estimate a simultaneous 4-equations model by Ordinary Least Squares (OLS) and three-stage least square to investigate empirically the above-mentioned determinants of business cycle correlation. Bilateral trade relations present a positive influence on business cycle correlations, while the dissimilarity of labor market rigidity presents a negative influence. The rest of the above-mentioned variables are non-significant. These results are robust to the use of the Hodrick–Prescott-filter and first differences as the de-trending methods, as well as the use of GDP as the business cycle measure, excluding the financial crisis years (2008 and 2009). Results for employment as the business cycle measure are in contrast with the previous ones, and found industrial dissimilarity to be the relevant variable to determine business cycles synchronization. In what concerns the determinants of the lead and lag behavior, results show that the member states of the Eurozone that usually lead the cycle are the ones that are wealthier, with strict employment legislation, more specialized in construction and finance sectors, and more prone to international capital movements. Differences in the determinants between contemporaneous business cycles and lead and lag behavior of business cycles are especially important for policy-makers in the Eurozone to know about, in particular if asymmetric shocks between countries are set in place.