Analysis of Economics Applications

Economies are based on capital accumulationin fixed capital investments. The accumulation of capital is expected tocontribute positively to economic growth as production and employment increase.The aim of this study is to investigate the relationship between agriculturalfixed capital investments and agricultural gross domestic product in Turkeyfrom 1999 to 2021, which considers multiple structural breaks. The stationarityof the variables has been examined for the first time using the Bai-Perronmultiple structural break unit root test approach in addition to traditionalunit root tests, which differs from other studies. Three different structuralbreak dates have been identified in the study, and the findings have beenevaluated in four different regime periods. As a result of the study, apositive and significant relationship between agricultural fixed capitalinvestments and agricultural gross domestic product has been found in the firstthree regime periods. In the first three regime periods, a 1% increase inagricultural fixed capital investments increased agricultural gross domesticproduct by approximately 0.260%, 0.054%, and 0.565%, respectively. Furthermore,the positive effect of agricultural fixed capital investments on agricultural grossdomestic product is highest in regime 3. However, contrary to theoreticalexpectations a 1% increase in agricultural fixed capital investments reducesagricultural gross domestic product by 0.09% in regime 4. The study concludesthat the impact of fixed capital investments in the agricultural sector onagricultural gross domestic product varies in direction and magnitude indifferent regime periods. It is considered necessary for Turkey, which aims toevaluate its potential in the agricultural sector sustainably andcompetitively, to promote technological innovations, prioritize infrastructureimprovements to increase agricultural productivity, and implement education andskill development programs.