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ID: 151157

Economic costs of separatist terrorism in Turkey / Bilgel, Fırat ; Karahasan, Burhan Can

Fırat Bilgel, Burhan Can Karahasan	Journal Article
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Summary/Abstract

Turkey has been suffering from separatist terrorism and the political conflict it implies since the mid-1980s, both of which are believed to have a negative impact on economic welfare. This article investigates the economic costs of Kurdistan Workers’ Party (PKK) terrorism, particularly in the Eastern and Southeastern provinces of Turkey by invoking the synthetic control method. We create a synthetic control group that mimics the socioeconomic characteristics of the provinces exposed to terrorism before the PKK terrorism emerged in the mid-1980s. We then compare the real gross domestic product (GDP) of the synthetic provinces without terrorism to the actual provinces with terrorism for the period 1975 to 2001. Causal inference is carried out by comparing the real per capita GDP gap between the synthetic and actual provinces against the intensity of PKK terrorist activity. Extended over a period of fourteen years (1988 to 2001), we find that after the emergence of terrorism, the per capita real GDP in Eastern and Southeastern Anatolia declined by about 6.6 percent relative to a comparable synthetic Eastern and Southeastern Anatolia without terrorism.

Key Words

Terrorism ; Conflict ; Political Economy ; Separatism

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ID: 167864

Thirty Years of Conflict and Economic Growth in Turkey: a synthetic control approach / Bilgel, Firat; Karahasan, Burhan Can

Bilgel, Fırat	Journal Article
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Summary/Abstract

This study seeks to estimate the causal effects of PKK separatist terrorism on economic development in Turkey using the synthetic control method. By creating a synthetic control group that reproduces the Turkish Gross Domestic Product (GDP) before PKK terrorism emerged in the late 1980s, we compare the GDP of the synthetic Turkey and the actual for the period 1955–2008. Our study finds that the Turkish per capita GDP would have been higher by about $2600 had it not been exposed to terrorism. This translates into an average of 21.4% higher per capita GDP over a period of 21 years.

Key Words

Economic Development ; Turkey ; PKK ; Separatist Terrorism ; Causal Inference

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