Regional welfare weights for Turkey

Abstract

Purpose

This paper aims to estimate a set of welfare weights for Turkey, based on per capita regional incomes, and to present them for possible policy consideration by the government.

Design/methodology/approach

An important component of the regional welfare weight measure is the elasticity of marginal utility of income (e), and it is estimated using a tax‐based method incorporating the principle of equal absolute sacrifice of satisfaction.

Findings

The estimated measure of e for Turkey is 1.25, and this value, in combination with per capita income levels, produces measured regional welfare weights for the poorest provinces that are over ten times as high as those for the richest provinces.

Research limitations/implications

A lack of suitable data makes it difficult to use alternative approaches to the tax‐based method for the purpose of cross checking results for e. Results based on these other approaches involving behavioural evidence are presented for some other countries for comparison purposes.

Originality/value

This paper presents estimates of regional welfare weights for Turkey based on sound economic principles. It will be of interest to academics who are concerned with issues relating to cost‐benefit analysis as well as practitioners who are involved in the allocation of public funds to different regions in Turkey.

Citation

Sezer, H. (2006), "Regional welfare weights for Turkey", Journal of Economic Studies, Vol. 33 No. 5, pp. 357-368. https://doi.org/10.1108/01443580610706582