İşsizlikle Mücadelede Doğrudan Yabancı Yatırımların Etkisi: Türkiye Örneği
The Impact of Foreign Direct Investment in Struggling with Unemployment: A Case of Turkey

Summary/Abstract: One of the most important conditions for achieving a sound structure of the national economies is to ensure economic stabilization. In this context, achieving economic stability is only possible by combination of full employment and price stability. In full employment level, all production factors in the economy are used. However, the lack of employment of labour, which is one of the factors of production, raises the unemployment problem and refers to underemployment in the strict sense. Unemployment has been an important problem for many years for the developing Turkey economy, which has a significant young population. The solution of the unemployment problem, which constitutes an important obstacle to economic stability, growth and development, is important and difficult for the economy. Foreign direct investment, which is one of the instruments in the fighting against unemployment, is expected to provide additional resources to the economy and create employment. Therefore, encouraging and increasing foreign direct investments is one of the most important objectives in the policies developed and implemented in Turkey. In this context, the effect of foreign direct investments on the struggling with unemployment for the Turkey economy was empirically analysed. In this study, the effect of foreign direct investments on employment was tested in two different ways as foreign direct investment inflow which is domestic investment of non-residents and foreign direct investment outflow that is domestic residents' investments to abroad. As a result of the research, it was found that there is no statistically significant relationship between the foreign direct investment outflows and unemployment. It is concluded that foreign direct investment inflows have a negative effect on unemployment in the long term.

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