Effects of Banking Credits on Economic Growth in Turkey

In this study, the development and sectoral distribution of banking credits in Turkey after financial liberalization and the effects of loans on economic growth are examined. In the study, the Autoregressive Distributed Lag (ARDL) model was adopted and Turkey’s 2000-2016 period data were used. According to the findings, loans used by sectors increased, but the share of agriculture and industry in total loans declined gradually, while the shares of the construction and services sector increased steadily. On the other hand, agriculture, industry and services sector credits affect economic growth positively, while loans to the construction sector affect long-term economic growth negatively. Moreover, although the share of the industrial sector in loans declined gradually, it was found to be the sector that increased the economic growth most