Regional Convergence in Inclusive Growth: Evidence from Turkiye

The 2008 Global Financial Crisis and the subsequent COVID-19 pandemic severely disrupted both global efforts and individual progress in reducing poverty worldwide. In addition to worsening poverty, the 2008 Global Financial Crisis widened income and wealth inequalities and hindered equitable access to opportunities. The devastating consequences of the pandemic further intensified these issues, renewing academic and policy interest in the debates surrounding inclusive growth. Motivated by these global events, this study tests whether inclusiveness in Türkiye’s NUTS-2 sub-regions converged (assessed relative to Istanbul (TR10)) between 2014 and 2024. The empirical analysis relies on the Social Mobility Index, constructed from Turkish Statistical Institute household income statistics, following the methodology of Anand et al. (2013). In the Anand et al. (2013) framework, inclusive growth is represented by changes in the Social Mobility Index. However, the study examines whether regional inclusiveness levels converged towards Istanbul (TR10). Accordingly, the empirical analysis uses the Social Mobility Index as the measure of regional inclusiveness. We apply second-generation panel unit root tests (Pesaran CADF/CIPS) to assess regional convergence. The results show a lack of convergence towards Istanbul (TR10) among Türkiye’s sub-regions, except TR82 (Kastamonu, Çankırı, Sinop) at the 10% significance level. Moreover, the study identifies that Türkiye’s Social Mobility Index shows a recovery in 2024, following a sharp decline driven by the COVID-19 pandemic.