The rising importance of culture in social cohesion and economic development necessitates the analysis of cultural consumption from an economic point of view.This is important to understand household profiles which provide a certain typology on the socio-economic and demographic patterns of cultural consumption. In this thesis, we identify the households that spend on recreation and culture, the amount they spend and the potential factors that impact households&rsquo / recreation and culture expenditures in Turkey using the 2003 Household Budget Survey of the Turkish Statistical Institute. The results of a multivariate Tobit analyses suggest that total household expenditures, household size and its composition, age of household head and higher education level and place of residence are significant determinants of a household&rsquo / s expenditures on recreation and culture in Turkey. Our results also indicate recreation and culture to be luxury goods with an estimated income elasticity of 1.55. The multivariate analyses also showed very different expenditure patterns among household residing in different regions of the country. While this result may indicate different tastes and preferences of households residing in different regions it may also be that the supply of cultural goods differ between regions. The impacts of education level together with the socioeconomic factors on household recreation and culture expenditures provide useful insights not only for the suppliers of recreational and cultural goods and services, but also for the policymakers who can influence household consumption behavior (that includes both participation and spending) through using both demand and supply-side instruments.

Using 2002-2006 Household Budget Survey, this thesis investigates the income, consumption and saving dynamics of Turkish households within a life-cycle theory framework by employing cross-sectional analyses and cohort techniques. Cohort techniques are used not only to analyze these variables, but also to investigate the demographics and components of income and consumption. The analyses are deepened by dividing the sample according to the location of the households (urban-rural areas), and significant differences are found between urban and rural households, especially in terms of saving behaviors. Income, consumption and savings of formal and informal households are also investigated. Analyzing these households provides information regarding the precautionary saving since the higher income uncertainty of the informal households is expected to force them for extra saving due to precautionary motive. Finally, the life-cycle model and the precautionary saving hypothesis are tested by estimating log-linearized Euler equations. In the test of precautionary saving hypothesis, formal-informal data are used as a proxy for the risk variable. According to the estimation results, the predictions of the life-cycle model do not hold for Turkey but there is no evidence that this is due to precautionary saving.

This dissertation aims to contribute to the field of economics of competition policy by analyzing the demand structure and the market power in the Turkish beverage industry and in the cola market in particular. First, a demand system for the beverage products has been estimated by using a multi-stage linearized Almost Ideal Demand System (AIDS). Using the own-price elasticity of cola in a SSNIP test (Small but Significant Non-Transitory Increase in Price), it is shown that cola market consists of a distinct relevant product market. Then, the demand elasticities of cola products at brand and package level have been estimated by the simple and nested logit models. Finally, the estimated demand elasticities of cola products have been used in measuring the degree of market power and predicting the effects of a hypothetical merger between Pepsi and Cola Turca by using a merger simulation technique. The results show that all cola suppliers have large price-cost margins for most of their products. Prices of the merging parties increase in average by 15 - 21% after the merger. The merger also causes the market price to increase by 16- 22% and consumer surplus to decrease by nearly 5% in average. Finally, depending on these results, the thesis recommends a stricter merger control criterion than dominance criterion for competition policy in Turkey.