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Much academic debate in the tradition of economic geography has focused on how to design successful strategies to trigger local and regional development. How a more effective economic policy to tackle regional imbalances and inequalities should be developed remains hotly discussed. Too frequently, however, the effective delivery and implementation of policies across all cities and regions fail not simply because of wrong policy tools. Often, one of the challenges is, also, to sort out the institutional process so that incentives to achieve effectiveness arise among politicians and bureaucrats. This thesis specifically focuses on pork-barrelling and distributive politics, that is, how politicians selectively target cities and regions with more or less governmental goods to reinforce their electoral advantage. While a significant number of contributions have been made to this field of enquiry, numerous gaps remain in understanding the implications of distributive politics on regional economic development policymaking and performance. The dissertation critically examines four different aspects and effects of distributive politics, drawing from the case of post-2002 Turkey. In spite of a significant burgeoning of this line of research across the world, questions about the extent to which ‘tactical allocative games’ prevail over technical policymaking criteria are frequently left unanswered. The first theme concerns the extent to which electoral factors prevail over technical considerations in the allocation of public investment by the central state to Turkey’s provinces. The evidence suggests that, while the government has allocated spending to reward its core constituencies, socioeconomic factors nonetheless remain the most relevant predictors of investment. Relatedly, almost no research has so far explored whether pork-barrelling has any economic consequences on regional economies. The second theme explores whether votes for the incumbent party can ‘buy’ preferential policy treatment and regional economic growth. The results show how, after addressing potential endogeneity, economic performance is almost entirely explained by ‘standard’ drivers, primarily human capital endowment. Third, the literature on distributive politics has frequently been legislature centric, in the sense that it has not paid adequate attention to the role played by bureaucratic agencies. The third paper explores whether the institutional characteristics of the agency in charge of the project cycle condition the attainment of publicly-oriented goals. Results point towards the argument that, to enhance policy effectiveness, bureaucracies must be not only capable an autonomous, but also accountable. Finally, the literature still provides unclear evidence on whether shifts from highly competitive electoral environments towards electoral one-party hegemony may lead to higher – or to lower – levels of pork-barrelling. The fourth theme therefore explores whether the constant surge of power enjoyed by Turkey’s AK Party has determined any change in the way public investment is allocated for tactical redistribution. Findings unexpectedly uncover decreasing levels of ‘punishment’ against opponents’ strongholds. Such reduction, however, is accompanied by increasing populist spending throughout the country. Overall, by providing novel evidence on the links between elections, public investment, and regional economic growth in post-2002 Turkey, the thesis contributes to advancing the understaning of the political economy of local and regional development.

This dissertation presents a paired case study of the growth performance of Turkey and Egypt in the interwar period, in order to shed fresh light on the income per capita divergence that occurred between them. First, we look at the extent and determinants of agricultural growth by estimating the net agricultural output and decomposing the crop output into its components. It is shown that acreage expansion, population growth and improvement in yields led to rapid recovery in agricultural output in Turkey, whereas the increasingly intensive cultivation in Egypt was only able to offset the impact of land scarcity and the earlier deterioration in yields. We also fill a major empirical gap in the literature by estimating industrial output growth and argue that although the industrial take off started in both countries in the 1930s, the output growth in Turkey was much greater. Moreover, industrialisation was mainly driven by textiles in Egypt, whereas it was more balanced in Turkey. Finally, we explore the sources of industrial output growth by focusing on textiles. The empirical analysis based on a partial equilibrium model implies that the impact of tariff protection on domestic growth was significant in both countries, yet it was complemented by the favourable movement of relative prices and wages and, in the case of Turkey, the increase in domestic incomes in the second half of the 1930s. Overall, it is argued that the greater expansion of domestic demand in Turkey, which was particularly driven by agricultural growth, was not only responsible for the per capita divergence, but also combined with different degrees of tariff protection to lead to a notable variation between Turkey and Egypt’s industrial performance. Therefore, the dissertation has implications for the experience of agricultural economies after the Great Depression. It is argued that in the presence of passive monetary and fiscal policies, factor endowments, historical development paths and geography played a prominent role in determining the extent of recovery in the 1930s.

The effect of public investment on economic growth is a popular topic in economic literature. Although there are endogenous growth models that incorporate public expenditure as a factor that promotes growth, findings in empirical literature provide conflicting results. This thesis contributes to this debate by providing a comprehensive analysis of the relationship between public investment and development by using a new panel dataset for Turkish provinces. For analyses, public investment is disaggregated as energy infrastructure, city infrastructure and security, education, health, transportation and communication, agriculture, mining, manufacturing, tourism and housing. The outcome variables are chosen as economic growth rate, the gross enrolment rate for primary and middle school, and the infant mortality rate. With regard to the econometric method, the fixed-effects technique is chosen. The dependent variables are calculated as the five-year forward moving averages of the outcome variables. Standard errors are corrected for serial correlation, cross-sectional dependence and heteroscedasticity. Findings in this thesis suggest that public investments in education, agriculture, tourism and energy infrastructure are associated with higher growth rates. There does not appear to be any statistical relationship between public city infrastructure and security investment and economic growth. However, public city infrastructure and security investment is related to the long-run gross enrolment rate positively, and the long-run infant mortality rate negatively. Additionally, public investment in energy infrastructure appears to have a negative relationship with the long-run infant mortality rate. Finally, results show that public investment in mining, transportation and communication are negatively related to the long run growth. The results provide partial support for the predictions of the model in Barro (1990) in the second chapter and the development literature in the third and the fourth chapters. Public policies in the sectors mentioned above arise as a factor that has an impact on the outcome of public investment. Post-estimation diagnostics and robustness analyses provide statistical evidence that support the findings.