Effect of Industrialization, Financial Development, Economic Growth and Urbanization on Energy Consumption in Turkey: An Evidence with Multiple Structural Breaks

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The aim of the present study is to investigate the effect of financial development, economic growth, urbanization and industrialization on energy consumption in Turkey. For this purpose, the annual data of Turkey for the period 1960-2012 was used in the study. First, it was analyzed whether these five variables used in the study contained a unit root. As a result of the traditional unit root tests series are I(0) and I(1). In addition to traditional methods, the unit root test that allows multiple structural breaks was also used. As the result of this test, it was found that all the series were I(1) and contained structural breaks. The cointegration test that allows for multiple structural breaks was used in order to analyze whether there is a long term relationship between the series. As the result of this test, it was found that there was a long term relationship between the series and the series contained structural breaks. Finally, the model was predicted through DOLS and FMOLS and an impulse-response analysis was performed based on the SVAR model. As the result of the analysis, it was determined that the effects of economic growth, industrialization and financial development were respectively prominent on the energy consumption in Turkey. The effect of urbanization on energy consumption was not found to be considerable.

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Energy consumption , financial development , economic growth , urbanization and industrialization , multiple structural breaks

Ege Academic Review (EAR)

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Ege Academic Review (EAR)