Analyzing The Determinants of Agricultural Value Added in EU15 Countries and Turkey by Panel Data

Abstract

Countries have to deal with the sustainability of food supply and demand due to factors such as rapid increase in demand for agricultural food products on a global scale and climate change. Therefore, productivity and agricultural value added products have become strategically important to ensure food security. Developed countries provide a significant amount of value added in the agricultural sector. The aim of the study was to determine primary factors affecting the agricultural value added production in Turkey and EU15 countries and to determine how Turkey differs from these countries as a developing country. In this context, the long-term impact of government effectiveness, political stability and gross domestic product on agricultural value added has been investigated for the EU15 countries and Turkey for the period of 2002-2019. Results indicated that Turkey had a lower agricultural value added amount than the EU15 countries. While a statistically significant and positive relationship between agricultural value added and agricultural GDP and Political Stability Index, a statistically significant and negative relationship between agricultural value added and Government Effectiveness Index were observed. Keyword: agricultural value added, government efficiency index, political stability index, panel data analysis JEL Classification: C23, , H50, O13, Q18