POLITICAL BUDGET CYCLES AND ELECTIONS IN TURKEY

Abstract

This paper analyzes political budget cycles in theory and applies Turkish elections between 1950 and 2011. Political budget cycles theory refers to increases in government spending or the deficit or decreases in taxes (including changes relative to long-term trends) in an election year which are perceived as motivated by the incumbent’s desire for re-election for his party. This study examines and tests existence of political budget cycles in Turkey. For this analysis, defense spending, educational spending, health spending, agricultural spending and spending on construction and housing on central government budget has used. In addition, budget of Ministry of Finance and government debt is analyzed. Findings of this study indicate that there is weak evidence of manipulation of the government budget but no evidence of manipulation of the budget after 2002.