Innovation, human capital and economic growth in Turkish cities: do city dynamics play a role?

This paper explores the role of city dynamics, such as growth rate, technology intensity, and population agglomeration, in the relationship between innovation, human capital, and economic growth in the case of 81 Turkish cities. A synthetic innovation index developed through principal component analysis (PCA) is employed as an innovation indicator. Based on the analysis conducted using annual data for the period 2004–2019, it has been determined that innovation and human capital positively impact economic growth. This positive effect is highest in metropolitan cities characterized by high technological density and population agglomeration. Furthermore, the influence of innovation becomes even stronger in metropolitan areas experiencing higher growth rates. While the relationship between human capital and growth follows a U-shaped pattern in metropolitan cities, no significant relationship is observed in medium-to-small-sized cities, except for those with slower growth rates.