GROWTH AND PRODUCTIVITY DYNAMICS IN TÜRKİYE SINCE ECONOMIC LIBERALIZATION

This study examines the sources of economic growth in Türkiye since the onset of economic liberalization within a growth accounting framework, focusing on the role of total factor productivity (TFP) in shaping long-term growth performance. Understanding productivity dynamics is essential, as sustained improvements in living standards depend primarily on efficiency gains rather than continued factor accumulation. The analysis decomposes growth into the contributions of physical capital, human capital, and productivity across six subperiods defined by major policy shifts and economic crises. The findings indicate that growth in Türkiye has been driven largely by physical capital accumulation, while the contribution of TFP has remained limited and mostly cyclical. Periods of stronger productivity performance coincide with comprehensive reform episodes, whereas demand-driven policy frameworks generate only temporary gains. In an era of heightened global uncertainty and rapid technological change, these results underscore the need for a coherent policy framework that prioritizes productivity-led growth.