Acemoğlu highlights lack of response to Turkey’s economic problems as the biggest threat to the country’s future
Renowned economist Prof. Dr. Daron Acemoğlu has voiced criticism regarding Turkey’s economic challenges, emphasizing the lack of a proactive approach to address these structural issues. Acemoğlu has warned that the most significant danger facing Turkey lies in the continuation of a mediocre economic performance.
In a recent statement shared on social media, Acemoğlu, a faculty member at the Massachusetts Institute of Technology (MIT), underscored the inherent structural nature of Turkey’s economic problems and the absence of a concerted response to tackle them. He expressed concern over the potential consequences of maintaining the status quo without implementing necessary reforms.
Acemoğlu further raised doubts about the purpose behind recent appointments in Turkey, questioning whether they were made with a genuine intention to enhance expertise and resolve economic problems or if there were other motivations at play. He highlighted the presence of politically motivated appointments as well as those made for symbolic purposes.
According to Acemoğlu, Turkey’s economic problems demand a more comprehensive and strategic approach. While acknowledging that the real political power lies in the hands of the president, he pointed out that it is entirely possible for the same policies to continue even as local elections approach.
The esteemed economist also suggested that rational policies could contribute positively to the Turkish economy. However, he questioned whether such an approach alone would realistically solve the country’s economic challenges.
Acemoğlu argued that Turkey’s economic growth has been of low quality since 2006, characterized by a lack of technological progress and minimal productivity gains. He cautioned that a mere adjustment of interest rates from highly negative real interest rates to less negative levels would not substantially address these structural issues. Instead, he stressed the need for radical economic transformation, emphasizing the high potential for the Turkish economy to grow in a more sustainable and productive manner. Acemoğlu cited the country’s youthful population and entrepreneurial spirit, as well as the emergence of numerous companies experiencing increasing productivity, as positive factors.
To realize this potential, Acemoğlu highlighted the importance of institutional reforms, including reducing corruption, fostering greater competition, mitigating political uncertainty, and improving the judicial system. Furthermore, he emphasized the significance of investing in technology, education, and enhancing workers’ productivity.
The economist concluded by asserting that Turkey’s greatest peril lies in the continuation of a subpar growth trajectory. Should Turkey persist in this manner, its potential could be squandered, particularly as the population ages and advancements in artificial intelligence and other technologies could leave the country further behind. Acemoğlu firmly believes that the gravest threat Turkey faces is the perpetuation of this mediocre economic performance.
As Turkey grapples with ongoing economic challenges, Acemoğlu’s critical assessment sheds light on the need for a comprehensive and proactive strategy to address the country’s structural issues, fostering sustainable growth and maximizing its true economic potential.
