Empirical Application of The Effectiveness of Investment Incentives in Türkiye From The Perspective of Investors
Necati Alp Erilli, Şerife Merve Koşaroğlu, İlkay Noyan Yalman, Sinan Dündar, Selçuk Yasin YıldızThe effectiveness of investment incentives is expected to reduce the imbalance between regions while ensuring economic growth. The sustainability of investment incentives and their expected impact are related to the rational allocation of resources to be used in this field. Although the incentive system, which has been in place in Türkiye for many years, has been updated according to economic requirements and planning, the evaluation of incentives from the perspective of investors has been neglected. The opinions and experiences of investors, who are the most important stakeholders in incentives, on the content and implementation of incentives are important in terms of increasing efficiency. The purpose of this study is to evaluate incentive implementation systems from the perspective of investors to enhance the effectiveness of investment incentives. This study aims to develop policy recommendations in line with the answers given to the survey questions prepared to evaluate the views of investors on the implementation of incentives. According to the results, it was determined that investors could not fully utilise the investment incentive system effectively because of both the investors and the system implemented. As a result, it has been concluded that to increase the effectiveness of investment incentives, the general characteristics of the region, sector, and investor should be taken into account in incentive practises and the SEGE criteria should be revised.
Türkiye’de Yatırım Teşvikleri Etkinliğinin Yatırımcılar Açısından Değerlendirilmesi Üzerine Ampirik Bir Uygulama
Necati Alp Erilli, Şerife Merve Koşaroğlu, İlkay Noyan Yalman, Sinan Dündar, Selçuk Yasin YıldızYatırım teşviklerinin etkinliğinden beklenen, ekonomik büyümeyi sağlarken, bölgeler arası dengesizliği de azaltmasıdır. Yatırım teşviklerinin sürdürülebilirliği ve beklenen etkiyi gösterebilmesi bu alanda kullanılacak kaynakların rasyonel dağılımıyla ilgilidir. Türkiye’de uzun yıllardır uygulanmakta olan teşvik sistemi ekonomik gereklere ve planlamalara göre güncellenmekle birlikte, yatırımcılar açısından teşviklerin değerlendirilmesi ihmal edilmektedir. Teşviklerin en önemli paydaşı olan yatırımcıların teşviklerin içerik ve uygulanması konularında görüşleri ve tecrübeleri etkinliğin artırılması bakımından önemlidir. Bu çalışmanın amacı, yatırım teşviklerinin etkinliğinin artırılması amacıyla yatırımcılar açısından teşvik uygulama sisteminin değerlendirilmesidir. Teşviklerin uygulanması konusunda yatırımcıların görüşlerini değerlendirmek üzere hazırlanan anket sorularına verilen cevaplar doğrultusunda politika önerilerinin geliştirilmesi hedeflenmiştir. Sonuçlara göre, yatırımcıların yatırım teşvik sistemini tam olarak etkin kullanamadığı, bunun da hem yatırımcılardan hem uygulanan sistemden kaynaklandığı tespit edilmiştir. Sonuç olarak yatırım teşviklerinin etkinliğinin artırılabilmesi için teşvik uygulamalarında, bölgenin, sektörün ve yatırımcının genel özelliklerinin dikkate alınması ve SEGE kriterlerinin revizyon edilmesinin uygun olacağı sonucuna ulaşılmıştır.
Legal arrangements for investment incentive systems are among the most important fiscal policy instruments used to increase development. Regardless of the country’s level of development, the aim of incentives is to ensure sustainable economic development and increase the level of welfare. At this point, incentives aim to ensure sustainable economic development, such as ensuring efficient resource allocation, eliminating regional inequalities, creating new employment areas, increasing export potential, increasing foreign investments, ensuring international competitiveness, and closing current account deficits. Regional development definitions emphasise raising the quality of life in developing countries to the level of developed countries in terms of socioeconomic indicators (Keskin, 2022:4). The investment incentive system has been in place in Türkiye for many years. Evaluations and research on the incentive system evaluate these incentives from different perspectives. In particular, the results of the studies show that incentives, an important policy tool for eliminating regional imbalance in Türkiye, have not had a sufficient effect in eliminating imbalance over the years. A major criticism is that the criteria applied to determine the degree of incentives are inadequate and inaccurate.
Studies investigating the effectiveness of investment incentives using different methods are available in the literature. The literature on the subject can be analysed in two parts. In the first part, the relationship between investment incentives and macroeconomic variables is investigated. In the second part of the study, survey studies were conducted to determine the effectiveness of incentives.
This study aims to evaluate the effectiveness of incentives from the perspective of investors, who are the most important stakeholders in investment incentive policies. The survey questions prepared for this evaluation were applied to firms benefiting from incentives in different regions. The expected contribution of this study to the literature is to determine investors’ views on the effectiveness of incentives. The views of investors who implement incentives in the field are thought to be effective in determining incentives’ deficiencies.
The data to be used in the evaluation of the Investment Incentive System implemented in Türkiye were collected through a situation assessment questionnaire. The situation assessment questionnaire comprised 48 questions. Of these questions, 21 are demographic questions, 10 are about the effects of incentives on firm activities (5-point Likert type), 16 are about firm opinions on the incentive implementation process (5-point Likert type) and 1 is a comment question. The situation assessment questionnaire was sent online to companies serving in different provinces and in different fields of activity in 6 regions classified according to the Socio-Economic Development Index (SEGE) using the simple random sampling method, and 313 companies responded positively. For the selection of companies to participate in the survey, the Chambers of Industry and Commerce of the provinces selected from these 6 regions were contacted, and the survey questions were sent through the communication channels received. The responses obtained from the surveys were compiled, analysed and interpreted.
When the results of the survey are evaluated in general, 72.2% of enterprises benefiting from the incentives have positive effects. In other words, approximately one-third of companies state that they are not positively affected. This is an important rate. It would be appropriate to increase the positive aspects of incentives and take initiatives to eliminate negative aspects. In this context, according to Table 4, institutionalisation increases the positive effects of incentives. Therefore, when offering incentives to firms, setting criteria that will increase their institutionalisation as a prerequisite may be a measure that will increase effectiveness. It was found that the effectiveness of incentives varies across sectors. For example, it is observed that the effectiveness in the agriculture, food, machinery, and textile sectors is higher than the effectiveness in the health, restaurant, and entertainment sectors. Therefore, incentives should be selective rather than generalising in terms of sectors. It is important to take sectoral distinctions into account when directing resources to appropriate and effective areas.
The primary effect expected from incentives is to reduce regional imbalances while ensuring economic growth. These two effects are realised together. Otherwise, ignoring regional differences and focusing only on firm growth will increase regional imbalances. On the other hand, incentivizing inefficient sectors to support regional development negatively affects economic growth. In conclusion, according to both the data obtained as a result of the literature review and the results of the survey conducted within the scope of the study; according to investors, the effectiveness of incentives as not at a sufficient level. To increase this level, it is important to review the incentive programme and increase sustainable and permanent effects.
