IDEAS home Printed from https://ideas.repec.org/a/ibn/ijefaa/v9y2017i8p221-228.html
   My bibliography  Save this article

Efficient Use of Capital: Paradox of Real Estate and Industry in Turkey

Author

Listed:
  • Ali Hepsen
  • Mehmet Asici
  • Olgun Aydin

Abstract

In recent years, one of the hottest debates on Turkish economy is the conflict on resource allocation between real estate and industry sectors. The debate was so intense that ex-minister of Economy Mr. Ali Babacan declared his opinions. Mr. Babacan¡¯s statements about the creation of fixed capital by the private sector is not promising, and private sector fixed capital expenditures are not in the desired level. This situation is due to the limited economic growth and future economic growth. In this study, we have investigated whether Mr. Babacan¡¯s statement is right or not. We have discussed the reliability of the measurement of real estate output as Gruneberg and Folwell did in 2013 and Ruddock did in 2002. That could be concluded that we agree with ex-minister of Economy Mr. Babacan¡¯s comments regarding to imbalances among sectors are threatening Turkish economy¡¯s stability. The imbalances are favoring residential real estate investments and consequently the country is exposed to currency risk.

Suggested Citation

  • Ali Hepsen & Mehmet Asici & Olgun Aydin, 2017. "Efficient Use of Capital: Paradox of Real Estate and Industry in Turkey," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 9(8), pages 221-228, August.
    • Handle: RePEc:ibn:ijefaa:v:9:y:2017:i:8:p:221-228
    as

    Download full text from publisher

    File URL: http://ccsenet.org/journal/index.php/ijef/article/view/69024/37898
    Download Restriction: no
    File URL: http://ccsenet.org/journal/index.php/ijef/article/view/69024
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Dean Baker, 2002. "The Run-up in Home Prices: A Bubble," Challenge, Taylor & Francis Journals, vol. 45(6), pages 93-119.
    2. Mahalia Jackman, 2010. "Investigating the Relationship between Residential Construction and Economic Growth in a Small Developing Country: The Case of Barbados," International Real Estate Review, Global Social Science Institute, vol. 13(1), pages 109-116.
    3. Erol, Isil & Unal, Umut, 2015. "Role of Construction Sector in Economic Growth: New Evidence from Turkey," MPRA Paper 68263, University Library of Munich, Germany.
    4. Stephen Gruneberg & Keith Folwell, 2013. "The use of gross fixed capital formation as a measure of construction output," Construction Management and Economics, Taylor & Francis Journals, vol. 31(4), pages 359-368, April.
    5. Les Ruddock, 2002. "Measuring the global construction industry: improving the quality of data," Construction Management and Economics, Taylor & Francis Journals, vol. 20(7), pages 553-556.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Roy, Saktinil & Kemme, David M., 2012. "Causes of banking crises: Deregulation, credit booms and asset bubbles, then and now," International Review of Economics & Finance, Elsevier, vol. 24(C), pages 270-294.
    2. Elena Stupnikova & Tatyana Sukhadolets, 2019. "Construction Sector Role in Gross Fixed Capital Formation: Empirical Data from Russia," Economies, MDPI, vol. 7(2), pages 1-16, May.
    3. Michal Jurek & Pawel Marszalek, 2014. "Subprime mortgages and the MBSs in generating and transmitting the global financial crisis," Working papers wpaper40, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.
    4. Dirk J. Bezemer, 2012. "Modelos contables y comprensión de la crisis financiera," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 14(26), pages 47-76, January-J.
    5. Dirk J. Bezemer, 2011. "Who Predicted the Crisis and What Can We Learn from Them?," Chapters, in: Óscar Dejuán & Eladio Febrero & Maria Cristina Marcuzzo (ed.), The First Great Recession of the 21st Century, chapter 1, Edward Elgar Publishing.
    6. Ryan Fox & Peter Tulip, 2014. "Is Housing Overvalued?," RBA Research Discussion Papers rdp2014-06, Reserve Bank of Australia.
    7. Alan S. Blinder, 2014. "Federal Reserve Policy Before, During, and After the Fall," Book Chapters, in: Martin Neil Baily & John B. Taylor (ed.), Across the Great Divide: New Perspectives on the Financial Crisis, chapter 5, Hoover Institution, Stanford University.
    8. Kwabena Asomanin Anaman & Irene Susana Egyir, 2019. "Economic Shocks and the Growth of the Construction Industry in Ghana Over the 50-Year Period From 1968 to 2017," Research in World Economy, Research in World Economy, Sciedu Press, vol. 10(1), pages 1-16, June.
    9. David M. Kemme & Saktinil Roy, 2012. "Did the Recent Housing Boom Signal the Global Financial Crisis?," Southern Economic Journal, Southern Economic Association, vol. 78(3), pages 999-1018, January.
    10. Gunther Tichy, 2010. "War die Finanzkrise vorhersehbar?," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 11(4), pages 356-382, November.
    11. Peter C. B. Phillips & Jun Yu, 2011. "Dating the timeline of financial bubbles during the subprime crisis," Quantitative Economics, Econometric Society, vol. 2(3), pages 455-491, November.
    12. Les Ruddock & Jorge Lopes, 2006. "The construction sector and economic development: the 'Bon curve'," Construction Management and Economics, Taylor & Francis Journals, vol. 24(7), pages 717-723.
    13. Egan, Paul & Kenny, Eoin & McQuinn, Kieran, 2022. "Increasing future housing supply: What are the implications for the Irish economy," Quarterly Economic Commentary: Special Articles, Economic and Social Research Institute (ESRI).
    14. Yang Hu & Les Oxley, 2017. "Exuberance in British Share Prices during the Railway Mania of the 1840s: Evidence from the Phillips, Shi and Yu Test," Working Papers in Economics 17/09, University of Waikato.
    15. John Harvey, 2010. "Keynes’ Business Cycle: Animal Spirits and Crisis," Working Papers 201003, Texas Christian University, Department of Economics.
    16. Hirota, Shinichi & Suzuki-Löffelholz, Kumi & Udagawa, Daisuke, 2020. "Does owners’ purchase price affect rent offered? Experimental evidence," Journal of Behavioral and Experimental Finance, Elsevier, vol. 25(C).
    17. Muhammad Ali Musarat & Alishba Sadiq & Wesam Salah Alaloul & Mohamed Mubarak Abdul Wahab, 2022. "A Systematic Review on Enhancement in Quality of Life through Digitalization in the Construction Industry," Sustainability, MDPI, vol. 15(1), pages 1-20, December.
    18. Upreti, Priyanka & Handa, Akanksha & Chaudhari, Dipak & Ghosh, Saurabh, 2021. "A Composite Indicator of Realty Sector Activity in India," MPRA Paper 111059, University Library of Munich, Germany.
    19. Yefimov, Vladimir, 2011. "Дискурсивный Анализ В Экономике:Пересмотр Методологии И Истории Экономической Науки. Часть 1. Иная Методология Экономической Науки [Discourse analysis in economics: methodology and history of econo," MPRA Paper 49157, University Library of Munich, Germany.
    20. David M. Kemme & Saktinil Roy, 2012. "Did the Recent Housing Boom Signal the Global Financial Crisis?," Southern Economic Journal, John Wiley & Sons, vol. 78(3), pages 999-1018, January.

    More about this item

    Keywords

    use of capital; economic development; economic outlook; real estate investments; mortgage issuance;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ibn:ijefaa:v:9:y:2017:i:8:p:221-228. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Canadian Center of Science and Education (email available below). General contact details of provider: https://edirc.repec.org/data/cepflch.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.