Property rights issue and rent seeking in Turkey: A time series study with cointegration and error correction techniques for the period of 1960-2002

The property rights issue is one of the most important institutional differences between democratically developed and developing countries. In most of the cases, the violation of the property rights results with rent-seeking activities. In this chapter, Katz and Rosenberg's budgetary variable model has been tested in a time series study for the period of 1960 to 2002 to measure rent-seeking activities in Turkey. It is found that there is a cointegrating relationship exists between variables, by which mean that there is a long-run relationship between budgetary rent-seeking (Rt), GNP per capita (GNPCt) and Government Size (GYt). It is also found that independent variables help to explain rent-seeking activities in Turkey during the period 1960-2002. In addition to these cointegrated relationships, it is showed that adjustments are made towards restoring the long-run relationship between rent-seeking and other variables