This study examined the effects of competitiveness on the economic growth of transition countries between the years 1995 and 2009. Panel ARDL (Autoregressive distributed lag) models were applied for 23 countries. The competitiveness of industrial sectors and sub-sectors were calculated by Balassa index, and the effects of the indexes on transition economies (TEs) were checked via the control variables of: capital formation per capita, and globalization index in the Cobb-Douglas production function framework. The findings indicate that some sectors affect TEs positively whereas others affect them negatively.

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Together with starting to observe the situations like the development differences seen between the countries after industrial revolution between the cities and regions of the countries. This situation leads some of the cities to emigrate and some other cities to become more crowded. The negative externalities emerging in migration-receiving cities make the life in those cities intolerable, whilst the decreasing population of emigrant cities triggers the decrease in both of demand and supply that is a production factor. The reflection of this situation shows itself as the cycle of “migration-revenue decrease-migration”. Through the investment incentives given to underdeveloped regions in order to prevent the migration that is a reflection of regional imbalances, it is aimed to decrease the imbalances by increasing the employment and revenue. The incentives applied in the year after statistical region classification in Turkey consist of incentives in periods of 2004-2008 and 2009-2012. In this study, it has been examined if there is any convergence between the income per capita in city and region axes, and if the incentives have any influence on this convergence. The investment incentives prepared in accordance with the realities of the cities eliminate the development differences by creating more efficient results. As a policy argument, it can be asserted that the incentive implementations considering the comparative superiorities of the cities will play more important roles in both of ensuring the efficient use of the resources and closing the development differences.

Sudden fluctuations that occur as results of politicians’ manipulation on the macroeconomic variables during the election period are called as Political Business Cycle. In recent years, exchange rate also has become an important subject of many studies in this framework. Before the elections, to gain the public’s votes, politicians firstly put pressure on the exchange rates to prevent currency depreciation, and then this can lead to manipulative fluctuations. In this respect, during the 1992:01-2014:12 periods in Turkey, the impact of the entire local and general elections on the real exchange rate volatility is examined using E-GARCH method. On the other hand, political variables such as independence of Central Bank, exchange rate regime, the number of representatives of the ruling party in the parliament and coalition are included to the model while the pre and after election period from the 1st to the 6th month as dummy variables. Based on the results of the analysis, it can be said that the elections and the political variables affect the real exchange rate and its volatility in Turkey. However, there is no significant evidence whether the politicians act opportunistic behavior to be reelected. Since the uncertainty during the election period cause outflow of the capital and deferral of the investment decisions of the investors until after the election, it may well be said that the politicians fail to influence the real exchange rate for their self-interests.