Are imports a reason of growth?: Evidence from Turkey

In smaller and open economies, import and foreign trade play major roles in economic development and growth. Thus, the importance of import and export in economic growth is a field of research, which is highly current in economic literature. The purpose of this study is beyond determining, whether the export oriented growth hypothesis is valid for the period between 1998-2008 and it also aims to determine the role import has over export and growth theoretically and econometrically. Engle-Granger causality test was conducted on the data of these periods inspected. Based on the findings obtained; no causality relation is available between export and growth, while bidirectional causal relation was determined between import and export. Furthermore, unidirectional causal relation was determined from import to export. © Medwell Journals, 2010.