Institutional Determinants of Regional Poverty in Turkey: Evidence from Advanced Causality Analysis

Poverty continues to be one of the major issues in Turkey, as in many other countries, with a large portion of the population – especially in rural areas – living below the poverty line. Those living in poverty have limited access to key public services such as education, healthcare and housing, which consequently exacerbates social and economic inequalities within society. The gap between wealthy and impoverished groups within society is continually expanding, primarily due to institutional factors that perpetuate this inequality. Drawing on data from 2009 to 2019, this study offers an empirical analysis of the role of institutions in shaping poverty in Turkey. The study applies the panel causality test developed by Juodis et al. (2021) to assess the influence of institutional structures on regional disparities. Infant mortality rates, the number of associate and bachelor’s degree graduates and the number of convicts are considered key indicators of institutional performance. The statistical analysis reveals a significant correlation between these variables and the 50% poverty rate. The findings suggest that strengthening the institutional framework is essential for addressing regional poverty in Turkey.