The Development of Foreign Direct Investments (FDI) in Turkey and an Econometric Analysis of Its Effects of Economic Growth (1985-2017)

Turkey has lived the capital and enterprise inadequacy as a result of a legacy of the past, for long time.Due to this situation, foreign capital and hence foreign (external) investments have been of a great importance in order to increase investments in the country. The encouragement of foreign capital and foreign investments due to this importance is became a valid practice in all periods. However, while the foreign capital and foreign investments is viewed favorably at the all periods, the increase of the foreign investment inflows to Turkey has realized after 1980, not before. The subject of this article is the development of foreign investments in Turkey and the impact of foreign direct investments (FDI) on economic growth for the period of 1980 to 2017. In this context, cointegration and stability analysis were performed to test the relationship between foreign investments and economic growth. According to the results obtained from our econometric research, foreign direct investments in Turkey in the long term has a positive effect on economic growth