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Worthy Transfers ? A Dynamic Analysis of Turkey’s Accession to the European Union

Author

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  • Gul ERTAN OZGUZER

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

  • Luca PENSIEROSO

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) FNRS)

Abstract

In this paper, we build a two-country dynamic general equilibrium model to study whether European citizens would benefit from the eventual accession of Turkey to the European Union. The results of the simulations show that Turkey's accession to the European Union is welfare enhancing for Europeans, provided that Turkish total factor productivity (TFP) increases sufficiently after enlargement. In the model with no capital mobility, the Europeans are better off it the Turkish TFP increase bridges more than 31% of the initial TFP gap between Turkey and the European Union. That figure becomes 45% when capital mobility is introduced.

Suggested Citation

  • Gul ERTAN OZGUZER & Luca PENSIEROSO, 2009. "Worthy Transfers ? A Dynamic Analysis of Turkey’s Accession to the European Union," LIDAM Discussion Papers IRES 2009029, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:2009029
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    More about this item

    Keywords

    European Union; Turkey; Enlargement; Dynamic General Equilibrium; Open Economy Macroeconomics;
    All these keywords.

    JEL classification:

    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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    This paper has been announced in the following NEP Reports:

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