Intertemporal CGE Analysis of Income Distribution in Turkey

Aykut Yakut and Ebru Voyvoda

No 1703, ERC Working Papers from ERC - Economic Research Center, Middle East Technical University

Abstract: This study focuses on the effects of public policies on the size distribution of income in Turkey. To this end, an intertemporal dynamic equilibrium model with heterogeneous agents in a small open economy framework is constructed. This study serves several extensions to the literature via its algebraic structure and the calibration process in which various micro-level data sets are utilized. The results reveal that, in line with the previous findings of the literature, increasing budget allocations to unilateral social transfer programs has no significant effect on the size distribution of income and has adverse effects on the labor market decisions of relatively poor laborers. On the contrary, subsidizing the cost of labor has positive impacts on labor supplies and the size distribution of income improves in favor of relatively poor households.

Keywords: Income distribution; Redistributive policies; Internal migration; Intertemporal CGE (search for similar items in EconPapers)
JEL-codes: D33 D58 D91 D92 H23 (search for similar items in EconPapers)
Pages: 58 pages
Date: 2017-02, Revised 2017-02
New Economics Papers: this item is included in nep-ara, nep-cmp and nep-cwa
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:met:wpaper:1703

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