FEAS RESEARCH E-BULLETIN FEAS E-BULLETIN DECEMBER 2016 | Page 17

Author: Yılmaz, Gökhan
Title: Essays on the Middle Income Trap with Special Emphasis on Turkey
Supervisor: Assoc. Prof. Dr. Dürdane Şirin Saraçoğlu
Department: Economics
Date: May 2016
Abstract: In the thesis, we present two different endogenous growth models for a middle income trap
economy. In order to present two growth models, first we investigate the experiences of the middle
income trap and nontrap countries. Our analysis shows importance of “human capital” and
“structural change” rooted factors to overcome the middle income trap. Second, we analyze the
relative importance of these factors by using the shift share analysis. Our findings demonstrate
that average

labor

productivity

growth rates

differ significantly in the trap and nontrap

economies and this difference mainly comes from the “within sector” productivity gains. Third,
we present an endogenous growth model with quadratic technology function for a middle income
trap economy (the first model). The quantitative assessment of the model for Turkey shows that
increasing the years of schooling, educational quality, share of researchers in overall educated
population, and the technology transfer may enable Turkey to escape the trap. Last, we present an
endogenous growth model with human capital and biased technological changes for a middle
income trap economy (the second model). The model implies that the most effective two ways to
get a higher growth rate and hence to get satisfactory convergence experience are to have
improvements in human capital quantity and quality. Both of the models in the thesis show the
importance of a high quality education system with special emphasis on the science, technology,
engineering and mathematics training to overcome the trap.

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