THE RELATIONSHIP BETWEEN DEMOCRACY AND ECONOMIC GROWTH IN THE 21st CENTURY: A LITERATURE REVIEW

The relationship between democracy and economic performance has been the subject of interest to social scientists, especially economists, for the past few centuries. However, the democratization movements experienced in the Middle East recently have caused the relationship between democracy and economic growth to become a current issue. The study aims to contribute making the relation between democracy and development-growth more prominent by presenting different views that are related to these two concepts, and to examine how this relation (presence/absence, direction, grade) in the 21st century particularly in the light of empirical studies. Following the theoretical and empirical evaluation, it can be claimed in general that the democratic institutions are more favorable (positive) in terms of economic growth. This result supports the Compatibility Perspective that expresses a positive relationship between democracy and economic growth. Considering the small number of studies investigating the relationship of democracy and economic growth in Turkey, it is seen that the results are in accordance with all three views in the international literature