Socioeconomic disadvantage and politics in the geographical allocation of public resources : evidence from Turkey's fixed capital investments

Following the political economics literature documenting how public resources are likely to be geographically distributed along equity and efficiency as well as political considerations, this article is aimed at exploring to what extent, and through which channels, politics play a role in regional development policymaking. The article first contributes to the literature by providing a general political economic theoretical framework. We then test it empirically by measuring via Fixed-Effects and GMM techniques the extent to which socioeconomic criteria, as opposed to political factors, drove over 2004-2012 the allocation of public central fixed-capital investments in Turkey' 81 provinces. In spite of its low coverage in international literature, contemporary Turkey offers a unique set of economic and political dynamics providing enough variation to test our question. Results show that after controlling for political manipulations, socioeconomic measures remain the most relevant predictors of investments. In contrast to official regional development policy principles, the State tends to favour areas with a higher level of development over the ones with the most critical "socioeconomic need" Nonetheless, political factors do also amount for a relevant share of allocations. Contrasting earlier works, outcomes in particular suggest that politics-related distortions statistically reflect more party rather than individual politicicans' interests.