VALIDITY OF THIRLWALL’S LAW FOR BRIC-T COUNTRIES: PANEL DATA ANALY-SIS

According to the Thirlwall’s Law, the main factor which restricts the economic growth in an open economy is the balance of payments. The aim of this study is to investigate the validity of the Thirlwall Law for BRIC-T (Brazil, Russi India, China, Turkey) countries for the period between 2000 and 2015. Panel data analysis has been used in the empirical part of the study. Heterogeneity (vice versa) and cross-sectional dependency of the variables are examined with some preliminary tests. Respectively, Delta test and CDlm test have been applied. After proving the stability of the variables with second generation panel unit root tests, the long-term cointegration relationship is estimated by Westerlund Durbin-H test. According to the results, Thirlwall’s Law is not valid for BRIC-T economies