Investigating the relationship between the recent investments on construction sector and some economic indicators of Turkey

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2016
Aydın, Aykut
Construction industry is believed to constitute a significant part of the economic development and there are quite noteworthy studies that analyze the relationship between construction industry investments and economic development. This study attempts to find out this causal relationship by using Toda and Yamamoto Augmented VAR model for Granger Non-causality. In addition, two separate models are used in order to detect the effects of specific construction activities such as residential, commercial and industrial by both public and private actors. The quarterly data are taken from Turkstat covering the period of 2000Q1-2013Q4 for model 1 and 2002Q1-2013Q4 for model 2. The results of the Wald tests of the first model shows that the total construction activities and GDP have bidirectional causal relationship both for public and private sectors. Also, a significant bidirectional causality has been found between public and private construction activities indicating the mutual interaction among different actors in the industry. However, the second model shows that these bidirectional causalities are not valid for specific construction types. According to the results of the Wald tests, all of the unidirectional relationships are proceeded from GDP to residential and commercial construction types of public sector, and residential and industrial construction activities by private actors. Nonetheless, an important bidirectional causality is detected between public residential construction activities and total employment.
Citation Formats
A. Aydın, “Investigating the relationship between the recent investments on construction sector and some economic indicators of Turkey,” M.S. - Master of Science, Middle East Technical University, 2016.