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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

World bank database 2012

Economic Growth And Financial Indicators Connection
Mustafa Öztürk, Osman Kadi, Filiz Kadi
Fatih Üniversitesi, Fatih Üniversitesi 34500 Büyükçekmece/İstanbul
E-mails: mozturk@fatih.edu.tr,oskadi@fatih.edu.tr,fkadi@fatih.edu.tr
Abstract
Real macro economic factors have always been accepted as main determinants of
nations’ economies’. However, the development of financial markets and the rise of financial
activities in globalizing world economies have led financial actors to affect nations’
economies’ more and more everyday.
With the rise of liberalization process after 1980, the influences of financial
developments rised in Turkey, too. In today’s world, the effects of financial factors on
Turkish economy is more evident than any time.
In this study, with the aim of detecting the effects of financial factors on Turkish
economy, the relations between financial data as Exchange rates, interest rates and IMKB
100 index and economic growth has been analysed.
Keywords: financial data, exchange rates, interest rates, economic growth, Vector Auto
Regression Model (V.A.R).
1.INTRODUCTION
The relation between financial developments and economic growth has been frequently
debated subject lately. These debates mostly focus on the case that financial developments
affect economic growth or economic growth affects financial developments.
In today’s economies in which financial markets gradually enlarge and financial instruments
gradually increase, it is observed that financial improvements influence economic growth.
Assets’ prices are formed and change under the influence of financial developments; financial
developments determine consumption and investment expenses in a significant amount.
In this study, financial macroeconomic data and economic growth relation has been
analysed by dividing the onservations between 1998-2010 into quarters. After a literature
review of the subject, causality relation between financial data and economic growth has been
analysed by granger causality test. After that, vector auto regression (VAR) model has been
applied. Lastly, effect-reaction functions have been deducted by the help of correctness tests.
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2. Empirical Studies
Harvey (1998) studied the relation between interest rates and maturity form and consumption
expense. Estrella ve Hardouvelis (1991) analysed the one between bond yields and growth.
Cozier ve Tkacz studied the amount of impact that interest rates in Canada have on GSYİH.
Mishkin (1995) and Bernanke and Gertler (1995) asserted that the causality from interest
rates to real production is dubious. Kamin and Rogers (2000) studied the relation between
national income and exchange rate. Çetintaş and Barışık (2003) analysed the relation between
banks, capital market and economic growth.
3. Data Set and Method
In today’s Turkey which has adopted liberal politics, it has occurred as a subject of debate
that the nation has left open to foreign shocks after the elimination of restraints beyond
foreign capital. Besides, it is asserted that a nation having savings gap needs foreign capital
for financing its expenses, mainly investment expenses and otherwise a crisis may occur.
With this aim, the years between 1998 and 2009 have been analysed in three-month segments
and macro economic data has been analysed with capital movements towards Turkey. After
detecting the crisis level that is caused by corruption of macro data, whether capital
movements are influential on these corruptions or not and which macro economic data at
which amount is influenced by capital movements have been searched for. Analyses eviews
5.0 packet programmes and VAR model were used for that.
Table. 3. 1 Macro Economic Variables Used in the Model
Variables

Code of Variable

Type

Definition

Growth Rate (GSYİH)

GROWTH1

Endogenous

Seasonal Adjusted Stagnant

Real Foreign Exchange Rate

EXCHANGELOG1

Endogenous

Seasonal Adjusted Stagnant

Foreign Exchange Interest

INTEREST1

Endogenous

No seasonal impact observed

Deposit Banks Loans

LOANSA1

Endogenous

Seasonal Adjusted Stagnant

IMKB 100 Index

IMKBLOG1SA

Endogenous

Seasonal Adjusted Stagnant

The series in the model have been selected as quarter periods from TCMB electronic data
distribution (EVDS) and they include the periods between the first quarter of 1998(1998Q11)
and the fourth quarter of 2009(2009Q4). All series that are subject to analyse have been
composed of precise periodic values. Numerical values that the the series are composed of
have been added to calculation as TL.
In the first step, it was analysed if the series contains unit root or not by the help of
Augmented Dickey Fuller and Dickey Puntola tests. The unit roots ones are bowdlerized of
root. After that, by rate to moving average method it was deseasonelized. In the third phase,
optimal delay values for the model have been determined with information criteria. In the
fourth step, relations between series and their directions were detected by Granger causality
test. In the fifth phase, VAR (Vector Auto Regressive) model was formed for the forecast of
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relations of foreign capital flow and reel macro economic data. In the sixth phase, relations
between variables were analysed by establishing cause and effect functions.
4. Model Determination and Analyses
4.1. VAR (Vector Auto Regressive) Model
Description and analyses of engagements between macro economical variables, forecasting
the future is significant. However, engagements are mostly mixed and multi dimensional. The
direction of the relation between variables, detection of dependent and independent variables
may be difficult. For this reason, simultaneous equation systems are required.
VAR Model (Vector Auto Regressive) is a model in which many variables are included in the
analyses with their past values and each equation is settled out by the method of least-square
method (Gujarati 2009:747). They have been developed for analyses of simultaneous
equation system. In this type of models, there are no boundries of in-out division. This model
puts all variables under operation at the same time and analyses in integrity. Variables can be
used even if they are not stabile at the same level. It is a cause of choice in time series
analyses for the reason that there are no restraints and it allows analyses of dynamic relations.
The fact that delayed values of dependant variables are included in the model paves the way
to strong anticipations of the future. With two variables, VAR Model can be formulated as
this:
p

p

i 1

i 1

p

p

i 1

i 1

yt  a1   b1i yt 1   b2i xt 1   1t

xt  c1   d1i yt 1   d 2i xt 1   1t
In the model, a1 is constant term, p is delay length, v is error term. In VAR model the
average of error terms is zero. Kovarians with delayed values is zero. Variances are constant.
They are in normal distribution and rassal quality. It is assumed that there is no relation
between errors and their delayed values but this doesn’t mean a restraint to the model.
Otocorelation problem may be eliminated by increasing delay length of variables. However,
in the condition of errors’ being in relation to each other (the correlation between them is
different from zero), change in one of the errors affects the other in a certain amount of time.
There is no relation between error terms and variables on the right of the model. On the right
handside of the model, there are delayed values of inner varibles and there isn’t the problem
of simultaneouty. This allows the equations in the model to be settled out with least squares
method.
4.2. Stagnancy
Stagnancy is a variable’s avarage, variance and otocovariance’s being stable in time.

 E (Yt )  E (Yt )  
 Var ( yt )  E ( yt   ) 2   2

  k  E[ yt   )( yt k )   )]
424

Average
Variance
Covariance

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Serie’s stagnancy is important in time series which follows a stocastic period. In stagnant
series, possible shocks will be temporary. The impact of shock will decrease gradually and
serie will be back to long term avarage level. In instagnant series, there will be no long term
avarage that the serie can go back after the shock. Series’ stagnancy is determined by unit
root test. Expanded Dickey Fuller (ADF) tests are used for this.

X t  a  X t 1   i 1 X t i  et

(1)

X t  a  bt  X t 1   i 1 X t i  et

(2)

m

m

Equations numbered (1) and (2) are the regression equations which are used for Dickey Fuller
test. Number (1) is an equation with a steadiness but without a trend, and number (2) is an
equation with both a steadiness and a trend. In number (1) equation H0: α =0 hypothesis and
in number (2) equation H0: b =0 hypothesis is tested for unit root test. If H0 is rejected, Xt
serie is stagnant, if not rejected it is not stagnant. Acoording to the results of ADF unit root
test, series are analysed to see if they have unit root on peg and this is done looking at %1,
%5 and %10 significance levels. Once the unit root is found, difference is taken and
evaluated out of the unit root (Bozkurt 2007:27–45).
Dickey Fuller Test was tested on %5 significance level with variables subjected to
analysis. While the test was being carried out, it was tested automatically using Schwarz Info
Criterion option since it was unknown if the error term was with autocorrelation. First
differences of not-stationary ones were differed from the unit root by taking I(1).
Table. 5.2. Steady State of Variables
Code of variable

Without trend

With trend

τ

%1

%5

%10

τ

%1

%5

%10

Growth rate (GSYİH)

-5,78

-3,59

-2,93

-2,60

-5,48

-4,2

-3,53

-3,20

Real Foreign Exchange
Rate

-7,85

-3,58

-2,93

-2,60

-7,77

-4,17

-3,51

-3,19

Foreign Exchange
Interest

-4,59

-3,58

-2,93

-2,60

-4,54

-4,18

-3,52

-3,19

Deposit Banks Loans

-1,49

-3,61

-2,49

-2,60

4,17

-3,51

-3,19

IMKB 100 Index

-5,07

-3,58

-2,93

-2,60

-4,17

-3,51

-3,19

-6,63
-5,03

Number 1 in codes of variable shows that the first level difference of that serie is taken. * symbolizes level of
the serie as %1 and ** as %5

4.3. Delay Level for VAR Analysis
Delay lengths for VAR analysis were specified being dependent on LR, FPE, AIC, HQ, SC
criteria in table 6.31 and via autocorrelation LM, heteroscedasticity White and normal
distribution Jargue-Bera tests. The smallest delay level, where there is no autocorrelation (as
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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

LM probability values more than 0,05), no heteroscedasticity (as White test Joint probability
value more than 0,05) and there is normal distribution (as normality probability values more
than 0,05), is 2 according to LR critical value.
Table. 5.3. Capital Movements and Delay Length for Real Data

VAR Lag Order Selection Criteria
Endogenous variables: GROWTH1 EXCHANGELOG1 INTEREST1 LOANSA1
IMKBLOG1SA
Exogenous variables: C
Date: 05/23/12 Time: 22:58
Sample: 1998Q1 2009Q4
Included observations: 40
Lag

LogL

LR

FPE

AIC

SC

HQ

0

320.4919

NA

9.70e-14

-15.77460

-15.56349*

-15.69827

1

363.3976

72.93965*

4.01e-14*

-16.66988*

-15.40322

-16.21190*

2

383.6763

29.40417

5.40e-14

-16.43382

-14.11161

-15.59418

3

411.3330

33.18796

5.57e-14

-16.56665

-13.18889

-15.34536

* indicates lag order selected by the criterion
LR: sequential modified LR test statistic (each test at 5% level)
FPE: Final prediction error
AIC: Akaike information criterion
SC: Schwarz information criterion
HQ: Hannan-Quinn information criterion

4.4. Causation Analysis
While the relations between variables are studied, two things are aimed at: one is whether
there is a connection between variables and if yes, in which direction; two is on which length
of delay the connection might be taking place. Granger (1969) causation test is a test done for
this purpose.
n

n

i 1

i 1

y t  a 0    i x t i   a i y t i  u i
426

(3)

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

n

n

i 1

i 1

xt   0   a i y t i    i xt i  u i

(4)

Through the causation test symbolised with the equations numbered (3) and (4), how the
variables x and y affect each other is found. With the components of x added to the model, it
gets clearer if x causes changes on the future values of variabley. The same is applied for y
with a parallel reason.
It is necessary that the variables x and y are stagnant or to be made stagnant to conduct the
Granger causation test. If the variables are not stagnant, a false causation will be observed.
The causation which appears as a result of fake regression is a sign of simultaneous
correlation.
Granger Causation Test was conducted for the reasons such as testing the correlation between
capital movements and real data, and identifying which variables affected each other in what
direction.
Table. 4.2. Economic Growth and Causation Test for Financial Indicators
Pairwise Granger Causality Tests
Date: 05/23/12 Time: 23:00
Sample: 1998Q1 2009Q4
Lags: 1
Null Hypothesis:

Obs

F-Statistic

Probability

42

7.90027

0.00769

GROWTH1 does not Granger Cause EXCHANGELOG1

0.17014

0.68225

INTEREST1 does not Granger Cause GROWTH1

4.54812

0.03931

4.85088

0.03361

5.06493

0.03013

1.65679

0.20562

12.5469

0.00105

0.49030

0.48795

46

8.32617

0.00609

EXCHANGELOG1 does not Granger Cause INTEREST1

6.53786

0.01417

EXCHANGELOG1 does not Granger Cause
GROWTH1

42

GROWTH1 does not Granger Cause INTEREST1
LOANSA1 does not Granger Cause GROWTH1

42

GROWTH1 does not Granger Cause LOANSA1
IMKBLOG1SA does not Granger Cause
GROWTH1

42

GROWTH1 does not Granger Cause IMKBLOG1SA
INTEREST1 does not Granger Cause
EXCHANGELOG1

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LOANSA1 does not Granger Cause
EXCHANGELOG1

46

EXCHANGELOG1 does not Granger Cause LOANSA1
IMKBLOG1SA does not Granger Cause
EXCHANGELOG1

46

EXCHANGELOG1 does not Granger Cause
IMKBLOG1SA
LOANSA1 does not Granger Cause INTEREST1

46

INTEREST1 does not Granger Cause LOANSA1
IMKBLOG1SA does not Granger Cause
INTEREST1

46

INTEREST1 does not Granger Cause IMKBLOG1SA
IMKBLOG1SA does not Granger Cause
LOANSA1
LOANSA1 does not Granger Cause IMKBLOG1SA

46

0.25459

0.61644

5.22721

0.02722

0.27700

0.60138

1.60341

0.21224

1.15539

0.28842

7.51754

0.00887

0.43663

0.51228

0.09848

0.75518

0.79231

0.37835

1.39905

0.24338

Portfolio investments, which constitute one part of capital movements, have a one-way
influnce on the followings; other investments, export/import ratio and capacity utilization
rate.
Other investments also have a one-way influence on economic growth. Furthermore,
export/import ratio, capacity utilization rate, industrial production index and unemployment
rate unilaterally affect other investments.
Foreign investments unilaterally affect industrial production index.
4.5. Rating of Variables
Rating the variables used in VAR method is applied for impulse-response functions which
are used to specify the reactions of the variables to shocks. Rating should be from exogenous
to endogenous. Assigning the correlation between exogenous and endogenous is done in
connection with the reactions that variables give to temporary shocks. Whereas the most
exogenous doesn’t react against the shocks stemmimg from other variables, the most
endogenous reacts against shocks both from others and the ones coming from itself. Rating
the variables is mostly decided through Granger Causation Analysis (Çiçek 2005:82–105). In
Cholesky decomposition, impulse-response functions may change when the variables are
rated differently (Güloğlu 2010:3). A correct rating must take place if the aim is a successful
analysis of the reactions of variables to shocks. In this study, variables are rated from
exogenous to endogenous using Granger Causation Test.
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Rating of real variables is as follows; direct investments, industrial production index, rate of
capacity utilisation, growth, export/import ratio, unemployment rate ve other investments.
Rating of variables is as follows; real exchange rate, foreign currency interest rate, 100 IMKB
indexes.
4.6. Impulse-Response Functions
Impulse-Response functions show how effective a standard deviation shock seen in one of
the random error terms of VAR model findings might be both in the present and future values
of endogenous variables. This decides whether the most effective variable could be used as a
political tool or not. Cholesky decomposition is one of the common methods used in defining
impulse-response coefficients, verticalising errors and diagonalising the acquired variancecovariance matrix.
Moving average method is one of the useful ways to analyse the mutual interactions between
xt and yt series. i coefficients are used to generalize the impacts of shocks in xt and yt on
the series of xt and yt. Four elements of jk (0) matris are influence values.



 xt   xt   11(i) 12 (i ) 
      
 yt   y  i  0 21(i) 22 (i)



 xt  i 
 
 yt  i 

For instance, 12 (0) shows the impact of a unit shock in yt on xt serie. Again, it shows,
respectively of 11 (1) ve 12 (1), the impact of a unit shock in xt-1 ve yt-1 on xt serie
(Bozkurt 2007:94-98).
Cumulative actions of xt and/or yt term are acquired through impulse-response functions’
sum of coefficients that their indexes match. For instance, it should be known that the item
12 (n) is the result of the impact of yt variation on xt+n after an n term. Therefore, the total
n

12 (i)
of cumulative actions of the term yt on xt serie after an n term is i  0
. Long term
influence value is acquired when n stretches into infinity. Since the series xt and yt are
n


i 0

2
jk

(i )

accepted static, the sum of
for all j ank k conditions is finite. Impulse-response
function is the name given to 11 (i), 12 (i), 21 (i) and 22 (i) coefficients. (Bilgili vd.
2007:142-143).
Whether capital movements have an impact on financial data was analysed through causation
test in previous part. In this section, on the other hand, disposability of capital movements as
a political tool was tried to test using the impulse-response analysis.
Vector Moving Average (VMA) display format was used in order to show the possible
reactions of real data to a standard deviation shock which may take place in capital
movements through impulse-response analysis. Results were shown in figures 6.23, 6.24 and
6.25. In the graphics of impulse-response analysis, centerline shows point estimates and
bottom and over lines show confidence interval of a standard error.

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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Figure 4.1. Impulse-Response Function
Response to Cholesky One S.D. Innovations ± 2 S.E.
Response of GROWTH1 to EXCHANGELOG1

Response of GROWTH1 to INTEREST1

.03

.03

.02

.02

.01

.01

.00

.00

-.01

-.01

-.02

-.02

-.03

-.03
1

2

3

4

5

6

7

8

9

10

1

Response of GROWTH1 to LOANSA1

2

3

4

5

6

7

8

9

10

Response of GROWTH1 to IMKBLOG1SA

.03

.03

.02

.02

.01

.01

.00

.00

-.01

-.01

-.02

-.02

-.03

-.03
1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

In figure 4.1, reaction shown by economic growth to a shock of standard deviation in real
dutch disease, foreign currency interest and IMKB 100 indexes is shown. Reactions given
could be outlined as follows;
Real dutch diseases positively affected the economic growth until the end of the second term.
However, after the second term it couldn’t put a recognizable impact.
Foreign currency interest rate negatively affected the economic growth until the third term.
No significant connection between deposit bank loan and growth rate could be identified.
The impact of IMKB 100 index on economic growth was positive until the end of the second
term. However, after the third term this influnce disappeared.

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4.7. Stagnancy Test of VAR Model
Stagnancy should be tested after the model is set up. Stagnancy of the model depends on
eigenvalues of coefficient matrix. System gets stagnant once all eigenvalues of coefficient
matrix exist within unit circle. When the eigenvalues of coefficient matrix exist outside the
unit circle, then the system is not stagnant. This means that it is because of the facts that since
all the eigenvalues of coefficient matrix are in the circle unit that the model is stagnant.
Figure 4.2 Stagnancy Test for VAR Model
Inverse Roots of AR Characteristic Polynomial
1.5
1.0
0.5
0.0
-0.5
-1.0
-1.5
-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

4.8. Autocorrelation Test of VAR Model
In order to testify whether VAR model involved a problem in structural meaning,
Autocorrelation Test – LM was conducted. The test, which was applied to specify whether
the error terms found in VAR model were connected, reveals that there is no autocorrelation
for 12 lags.
Table. 4.3. Capital Movements and Autocorrelation-Lm Test for Real Data
VAR Residual Serial Correlation LM Tests
H0: no serial correlation at lag order h
Date: 05/23/12 Time: 23:03
Sample: 1998Q1 2009Q4
Included observations: 42
Lags

LM-Stat

Prob

1

33.16078

0.1271

2

17.08283

0.8788

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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

3

18.71859

0.8104

4

31.84992

0.1624

5

23.28707

0.5608

6

25.88333

0.4138

7

25.45298

0.4372

8

15.74284

0.9223

9

30.50397

0.2060

10

23.30021

0.5600

11

31.83537

0.1628

12

25.43800

0.4381

Probs from chi-square with 25 df.

4.9. Heteroscedasticity Test
Chi-Square value shows there is no heteroscedasticity problem in the model predicted.
In other words, it reveals the fact that error term variance is the same for all observations. It
can be seen that there is no heteroscedasticity according to the results of white
heteroscedasticity test.

Table. 4.4. Capital Movements and White Test for Real Data
Joint test:
Chi-sq

df

Prob.

160.3245

150

0.2672

4.10. Stability Tests
Conducting CUSUM and CUSUM squere tests, it was attempted to study whether there was a
structural break in the model and no break was identified.

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Figure 4.2 Stability Tests
20

1.6

15
1.2

10
5

0.8

0
0.4

-5
-10

0.0

-15
-20

-0.4
00

01

02

03

04

CUSUM of Squares

05

06

07

5% Significance

08

00

01

02

03

CUSUM

04

05

06

07

08

5% Significance

5.CONCLUSION
Economical activities in modern-day economies are under the influence of both real
and financial data. In this analysis, it is observed that interest rates, exchange rates and stock
market data influence economic growth.
In a condition where bank loans are quite efficent in economical activities, changes in
interest rates will influnce those activities. Real economical activities are really rapid in
economies which are integrated into international system. Exchange rates, on the oher hand,
have a decisive impact in this situation. Just as securities exchanges are affected by economic
developments, economic life is also affected by the developments taking place in stock
market.
Economies which plan to achieve a steady and constant growth should also realize
healthy and sustainable finacial data besides their real macro economic data.
BIBLIOGRAPHY
Bernanke, Ben S., ve Mark Gertler. (1995). “Inside the Black Box: The Credit Channel of
Monetary Policy Transmission”, Journal of Economic Perspectives, Cilt.9, No.4. s. 27-48
Bozkurt, H. (2007). Zaman Serileri Analizi, İstanbul: Ekin Kitabevi
Cozier, B. ve Tkacz, G., (1994), “The Term Structure and Real Activity”. Working Paper 94103, Bank of Canada.
Çetintaş, H. Barışık, S. Türkiye’de Bankalar, Sermaye Piyasası ve Ekonomik Büyüme:
Koentegrasyon ve Nedensellik Analizi (1989-2000), İMKB Dergisi Cilt 7 Sayı 25-26
http://www.imkb.gov.tr/Libraries/imkbdergi/IMKB_Dergisi_Turkce25_26.sflb.ashx
Çiçek, M. (2005). “Türkiye’de Parasal Aktarım Mekanizması: VAR (Vektör Otoregresyon)
Yaklaşımıyla Bir Analiz”. İktisat İşletme ve Finans, Sayı. 233.
433

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Gujarati D. N. (2009). Temel Ekonometri, İstanbul: Literatür Yayıncılık.
David K. Backus. Kehoe, Patrick J. Kydland, Finn E (1992). International Real Business
Cycles, The Journal of Political Economy, Vol. 100, No. 4. s. 745-775,
http://www.fperri.net/TEACHING/macrotheory08/bkk.pdf (16.05.2010)
Estrella, A., ve Hardouvelis, G. A., (1991), “The Term Structure as a Predictor of Real
Economic Activity”, Journal of Finance, 46, 555–576.
Güloğlu, B. Vektör Otoregresif Modellerin Etki Tepki Fonksiyonlarının Güven Aralıklarının
Güvenirliliği, http://www.ekonometridernegi.org/bildiriler/o15s1.pdf s.3 (18.08.2010)
Harvey, C. R., (1988), “The Real Term Structure and Consumption Growth”, Journal of
Financial Economics, 22, 305–333.
Kamin S., Rogers J., 2000, The Asymmetric Effexts of Exchange Rate Fluctutations: Theory
and Evidence From Developing Countries, IMF Working Paper, WP/00/184
Mishkin, Frederic S. (1995). “Symposium on the Monetary Transmission Mechanism”,
Journal of Economic Perspectives, Cilt. 9, No. 4, s. 3-10.
Yentürk, N. (1997). “Finansal Serbestlik ve Makroekonomik Dengeler Üzerindeki Etkileri”,
Ekonomik
Yaklaşım,
Cilt
8,
Sayı
27,
,
s.139–141
http://yaklasim.iibf.gazi.edu.tr/ciltler/8/27/8.pdf

Analysis of Turkey’s Sustainable Development Performance at Last Decade by
Applying Green Economy Indicators
Yusuf Akan, İlyas Okumuş
University of Gaziantep, Gaziantep, Turkey
E-mails:iokumus@gantep.edu.tr, yusufakan@gantep.edu.tr
Abstract
In recent years, sustainable development has become a worldwide discourse, driven by
international treaties global environmental organizations and bodies such as European Union,
OECD. Sustainable development is a concept to be analyzed aspects of economic, social,
environmental and institutional. With the advents of sustainable development, green
economic development has become one of the most important economic issues. Countries
which target economic, social and institutional development should not neglect
environmental development. Development of green economy is the best way of slowing the
negative ecological and environmental impact. Developing countries neglect the protection of
the natural environment in the process of rapid industrialization. As a result of this situation,
natural resources rapidly run out and environmental quality begins to deteriorate. These
negative results return a significant cost to society. In this study, Turkey economy which has
averagely 5.5% economic growth in the last 10 years will be analyzed in terms of green
economy indicators. Turkey is a highly suitable ecological condition for crop production,
animal husbandry, fisheries and forestry activities because of its geographical position. The
basic components of ecological conditions are climate, highly variable the shape of the earth,
434

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                <text>Real macro economic factors have always been accepted as main determinants of  nations’ economies’. However, the development of financial markets and the rise of financial  activities in globalizing world economies have led financial actors to affect nations’  economies’ more and more everyday.  With the rise of liberalization process after 1980, the influences of financial  developments rised in Turkey, too. In today’s world, the effects of financial factors on  Turkish economy is more evident than any time.  In this study, with the aim of detecting the effects of financial factors on Turkish  economy, the relations between financial data as Exchange rates, interest rates and IMKB  100 index and economic growth has been analysed.  Keywords: financial data, exchange rates, interest rates, economic growth, Vector Auto  Regression Model (V.A.R).</text>
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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

concentration of anesthesia increases, the time of transition to induction stage shortens (Ross
et al, 2008). Induction times of the fish vary depending on the dose of clove oil and, normally,
as the dose increases, recovery time increases.

REFERENCES
Çetinkaya, O., Şahin A.( 2005) Balık Biyolojisi Araştırma Yöntemleri. (Ed) Mehmet Karataş,
Balıklarda Anestezi Uygulamaları ve Başlıca Anestesikler, 237-270. ISBN.975-591-757-8.
Cookea, S. J., Suskib, C. D. Ostranda , K. G, Tuftsb, B. L., Wahl, D. H.(2004) Behavioral and
physiological assessment of low concentrations of clove oil anaesthetic for handling and
transporting largemouth bass (Micropterus salmoides), Aquaculture 239, 509–529.
Padilla, D. K., Williams, S. L.(2004) Beyond ballast water: aquarium and ornamental trades
as sources of invasive species in aquatic ecosystems. Front Ecol Environ 2004, 2(3): 131–138.
Ross, L., Ross, B.(2008) Anaesthetic and Sedative Techniques for Aquatic animals, 240.
Seol, D., Lee J., Im, S., Park, I. (2007) Clove oil as an anaesthetic for common octopus
(Octopus minor, Sasaki). Aquaculture Research, 38, 45-49.
Tolon, T., Hekimoğlu, M.A.( 2011) Türkiye´de Süs Balığının Pazar Durumu. XVI. Ulusal Su
Ürünleri Sempozyumu 25-27 Ekim 2011 Akdeniz Üniversitesi, Antalya.
Ucar, A., Atamanalp, M. (2010) The Effects of Natural (Clove Oil) and Synthetical (2phenoxyethanol) Anesthesia Substances on Hematology Parameters of Rainbow Trout
(Oncorhynchus mykiss) and Brown Trout (Salmo trutta fario), Journal of Animal and
Veterinary Advances 9(14): 1925-1933.
Whittington, M., Pereira, M. A. M., Gonçalves, M., and Costa, A.(2000) An Investigation of
the
Ornamental
Fish
Trade
in
Mozambique.
URL
http://www.oceandocs.org/bitstream/1834/889/1/2000.11en.pdf
Yıldırım, Y.B., Genc, E., Turan, F., Cek, S., Yanar, M.(2010) The Anaesthetic Effects of
Quinaldine Sulphate, Muscle Relaxant Diazepam and Their Combination on Convict Cichlid,
Cichlasoma nigrofasciatum (Günther, 1867) Juvenies, Journal of Animal and Veterinary
Advances,9(3), 547-550.
Sustainable Development in Aviation Industry
and the case of Turkish Airlines
Mustafa Kavacık1, Saadet Zafer2, Ali Yıldız3, Davut Karaman
1Akdeniz University Alanya Faculty of Business, Alanya, Antalya, Turkey,
2Muğla University Dalaman Vocational School, Dalaman, Muğla, Turkey,
3Akdeniz University Alanya Chamber of Commerce and Industry Vocational School,
Alanya, Antalya, Turkey
E-mails: mkavacik@akdeniz.edu.tr, saadetzafer@akdeniz.edu.tr,
aliyildiz@mu.edu.tr,davutkaraman@akdeniz.edu.tr
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Abstract
Within changing world, sustainable development globally has become an important strategic
goal for all sectors.
Sustainable development seeks to protect, develop and balance social, economic and
environmental goals and resources in order to secure comfort and welfare of present and
future generations. The significance level of these related goals and sources is very high.
Threats and hazards such as limited resources around the globe, overly population increase,
global warming, damaging of ozone layer, decreasing of live species and environmental
pollution dramatically reveal the importance of sustainable development.
United Nations Framework Convention on Climate Change (UNFCCC) and Kyoto Protocol
which was signed in 1997 came into force in 2005. In this context, aviation industry is a good
sample for sustainability. Fuels used in consist of non-renewable resources so contribute to
climate change negatively. But, at the same time, that industry makes very valuable and
unique contributions to the sustainable development aimed by global society. These
contributions are realized social, economical and environmental dimensions.
Aviation industry is the safest and most efficient type in public transportation. Over long
distances and beyond geographical barriers, no alternative one exist so. It offers affordable
transportation services to the nations, regions and individuals with wide transportation
network. Furthermore, by promoting cultural and social ties, it facilitates exchange of
educational experiences.
Economically, aviation industry encourages economic development by facilitating access of
regional and global markets, involving with these markets and increasing market share. At the
same time, aviation industry leading to the development of trade, travel and tourism sector
provides improving of income distribution by creating employment around the globe.
This industry pioneers to the electronic transportation. Highly savings got at ticketing and
other documentation transactions by adopting to the electronic system. Decrease in the level
of aircraft noise-footprint at a 20 db in recent years, an increase in fuel efficiency of 70
percent in last 40 years – today’s newest aircraft technology often matchs the energy
consumption of modern cars and in some cases (depending on speed and distance)-, coming
down Carbon emission ratios dramatically, alternative fuel systems as biofuels and less
service required space area compared to other transportation types can be taken as outstanding
environmental effects of this industry.
Turkish Airlines (THY) showed an outstanding performance both economically and socially
for the last years. Now, being a member of Star Alliance Group, it has a wide flight network
around the globe with generated fleet. Furthermore, the company works to make contributions
to the sustainable future.
Keywords: Sustainable Development in Aviation İndustry; Sustainable Aviation; Carbon
Emission; Turkish Airlines Case;
1. INTRODUCTION
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Today, world deals with not only the countries’ GDP values or other economic data’s but
environmental issues and social benefits also. Climatic changes threat the future at a
significant degree higher than ever. Nowadays, world consumes its resources rashly, but
could future generations reach these resources easily is a problem the world faced. Similar
issues appear to be problem the world faces in this century.
Aviation industry plays essential role both in economic, social and environmental respect. As
air transportation developed, trade volume will increase, good transportation volume will
continue to be positive, cultures will socialize as a result of increased tourism traffic and time
will be used more efficiently. By performing all of them, using resources less and effectively,
being environmentally sensitive creates the critic points of this industry. To survive in this
industry depends on “Sustainability” and companies should change and design strategies
towards to the “green coloured” strategies. At this stage, instutions as IACO, IATA, UN, EU
help companies by creating and regulating rules, standards and systems as KYOTO or
European Union Emission Trading Scheme ETS.
In this sense, this paper examines the importance of sustainable development for aviation
industry. However, we examine Turkish Airlines as a case study in the context of how it has
become an international effective player in recent years, strategic alliances that have made
and contributions to the sustainability efforts.
2. Environmental Issues Associated with Aviation
Civil aviation, like most other economic activities, gives rise to environmental problems of
various kinds. In 1999, the ICAO (Interational Civil Aviation Organization) Secretariat
compiled an inventory of environmental problems what may be associated with civil aviation,
to assist the ICAO Council in identifying future priorities in the environmental. It was
assumed that "the environment" means all those natural and man-made surroundings which
may be adversely affected by the presence of civil aviation, but which are not directly
involved in the aviation itself10. Issues include:
2.1. Aircraft noise
Historically, noise has been the external impact of aviation with the highest profile. There
have been substantial reductions in the noise generated by new aircraft and in the overall
noise at many airports. However, at most airports, the frequency and total number of
movements is expected to increase in the future. For some people near airports, aircraft noise
is a significant nuisance affecting their quality of life. There is considerable variation in
individual reactions. Aircraft noise can also have impacts on sleep.11
Significant progress has been achieved in reducing the noise impact around many airports,
arising from reductions in both engine and airframe noise as well as improvements in

10 http://www.un.org/esa/sustdev/csd/csd9_bp9.pdf
11
http://www.desd.org.uk/UserFiles/File/new_articles/pro_body_participation/sustainable_aviation/S
ustainable-Aviation-full-document.pdf
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operational procedures. Today's aircraft are typically 75% quieter than jets in the 1960.12
Research initiatives target a further 50% reduction by 2020. The number of people exposed to
aircraft noise worldwide has gone down – by about 35% between 1998 and 2004. IATA (The
Air Transportation Association) has developed a policy on night flights. According to this
policy, Night time operational restrictions are increasing, especially in Europe. At some
airports, night flights are completely banned. These restrictions can have a serious impact on
the economy, next-day delivery services, home-based charters, freight services and
intercontinental flights. They can also increase daytime congestion.13 According to Air
Transport Action Group (ATAG) data, The South African horn made infamous at 2010 World
Cup, the vuvuzela, at blast is rated at 127 decibels. An A380 on the other hand takes off with
a relative whisper at 82 db.14 This shows us the latest improvements in aircraft engine
technologies.
2.2. Carbon Emissions &amp; Fresh Air
Air pollution arising from airline and airport operations has a variety of sources, including
aircraft engines, apron vehicles, ground transportation, refueling and power generation
equipment. These can pose a problem at a local scale, where increasingly stringent
environmental quality standards are being imposed, and at a global level, where increasing
concern is being expressed about the significance of the contribution of aircraft engine
emissions to the problem of global warming.15 With regard to climate change, IPCC
Report16 estimates that aircraft contribute about 3.5 per cent of the total radiative forcing by
all human activities and that this proportion is likely to increase. The emissions from aircraft
of relevance for climate change include carbon dioxide (CO2), water vapour nitrogen oxides
(NOx), sulphur oxides and soot.
In the context of environment, technological advancements, operational measures, and air
traffic management can all improve emissions and fuel efficiency. Acc. to IATA data, new
aircrafts are 70% more fuel efficient than 40 years ago and 20% better than 10 years ago.
Airlines are aiming for a further 25% fuel efficiency improvement by 2020. By 2050, net
aviation carbon emission is aimed to be half of what it was in 2005. Modern aircraft achieve
fuel efficiencies of 3.5 liters per 100 passenger km. The A380 and B787 are aiming for 3 liters
per 100 passenger km – better than a compact car! Aircraft engine emissions are directly
related to fuel burn. Each kilogram of fuel saved reduces carbon dioxide (CO2) emissions by
3.16 kg. So the key for airlines to minimize their environmental impact is to use fuel more
efficiently. IATA airlines improved their fuel efficiency by 3.1% in 2006 and 2007. IATA
12
http://www.desd.org.uk/UserFiles/File/new_articles/pro_body_participation/sustainable_aviation/S
ustainable-Aviation-full-document.pdf
13 http://www.iata.org/whatwedo/environment/Pages/aircraft_noise.aspx
14 http://www.atag.org/facts-and-figures.html
15 Upham P. Maughan J. Raper D. And Thomas C. (2003) Towards Sustainable Development ,
Earthscan Publications, 115
16 http://www.ipcc.ch/ipccreports/sres/aviation/index.php?idp=22
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airlines have adopted a voluntary fuel efficiency goal. This is to reduce fuel consumption
and CO2 emissions (per revenue tonne kilometer) by at least 25% by 2020, compared to 2005
levels.17
ICAO projections states that the commercial aircraft fleet is expected to increase to about
47,500 by 2036, of which more than 44,000 (94 %) aircraft will be new generation
technology.18 Acc. to ATAG, today, global aviation industry produces around 2 % of all
human-induced carbon dioxide (CO2) emissions. Aviation is responsible for 12 % of CO2
emissions from all transport sources, compared to 74 % from road transport. And around 80
% of aviation CO2 emissions are emitted from flights over 1,500 kilometers, for which there
is no practical alternative mode of transport19. The Figure below indicates passenger air
traffic fuel consumption per 100 km. It shows that fuel consumption will decrease in
subsequent years due to increasing technology and new generated engines and aircrafts.

Figure 1: Air Traffic fuel efficiency trend and today’s aircraft (source: ICCAIA)20
2.3. Alternative Fuels
Because of both economic and environmental issues, aviation industry should seek ways for
diversification of current fuels and should produce alternative fuels. The International Air
Transportation Association (IATA) is dedicated to support its members and the industry to
reduce the emission of CO2. Alternative fuels, particularly sustainable biofuels, have been
identified as one of the key elements in helping achieve this goal. Biofuels derived from
sustainable oil crops such as jatropha, camelina and algae or from wood and waste biomass
can reduce the overall carbon footprint by around 80% over their full lifecycle. Biofuels test
flights carried out by seven airlines have proven biofuels work and can be mixed with existing
jet fuel. The industry is now working on finalizing technical certification so biofuels can be
17 http://www.iata.org/whatwedo/environment/pages/fuel_efficiency.aspx
18 http://legacy.icao.int/icao/en/env2010/Pubs/EnvReport2010/ICAO_EnvReport10-Ch2_en.pdf
19 http://www.atag.org/facts-and-figures.html
20 http://legacy.icao.int/icao/en/env2010/Pubs/EnvReport2010/ICAO_EnvReport10-Ch2_en.pdf
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used for passenger flights.21 If the industry were to get 6 % of its fuel supply from alternative
fuels by 2020, this would reduce current carbon footprint by 5 %.22 Objectives are as follows:
building a long-term sustainable, environmentally friendly and cost competitive aviation
industry.
3. Social and Economic Factors
Aviation industry is the safest and most efficient type in public transportation. Over long
distances and beyond geographical barriers, no alternative one exist so. It offers affordable
transportation services to the nations, regions and individuals with wide transportation
network. Furthermore, by promoting cultural and social ties, it facilitates exchange of
educational experiences. However, developments at aircraft Technologies and at fuels affect
the social life directly. People lives near airports expose high noise than to other people, so
night sleep can be a torture for them. But recent developments decreased the noise problem at
a significant level about 35 % between 1998 to 2004.23 And also, low carbon emission will
affect social life in a positive manner too.
There is a general acceptance that there is a positive, mutually supportive relationship
between aviation and economy.24 Aviation supports some 56.6 million jobs around the world
or it carries 35% of the world’s cargo by value.
According to ATAG report 201025; Airlines transport over 2.6 billion passengers annually
with revenue passenger kilometers (RPK) totaling nearly 5 trillion in 2010. The USA
followed by China and then the UK were the top three countries in terms of RPK. Aviation is
indispensable for tourism, which is a major engine of economic growth, particularly in
developing economies. Globally, 51% of international tourists travel by air. Connectivity
contributes to improved productivity by encouraging investment and innovation; improving
business operations and efficiency; and allowing companies to attract high quality employees.
Aviation’s global economic impact (direct, indirect, induced and tourism catalytic) is
estimated at $2.2 trillion, equivalent to 3.5% of world gross domestic product (GDP).
It provides 8.4 million direct jobs: airlines, air navigation service providers and airports
directly employ 7.6 million people and the civil aerospace industry (manufacture of aircraft
systems, frames and engines) employs 0.8 million people. There are 9.3 million indirect jobs
generated through purchases of goods and services from companies in its supply chain.
Industry employees support 4.4 million induced jobs through spending. Aviation-enabled
tourism generates around 34.5 million jobs globally.
The world’s airlines carry over 2.6 billion passengers a year and 48 million tonnes of freight
in 2010. Providing these services generates 8.4 million direct jobs within the air transport
21 http://www.iata.org/whatwedo/environment/Pages/alternative-fuels.aspx
22 http://www.atag.org/facts-and-figures.html
23 http://www.iata.org/whatwedo/environment/pages/aircraft_noise.aspx
24 Upham P. Maughan J. Raper D. And Thomas C. (2003) Towards Sustainable Development ,
Earthscan Publications, 39
25 http://www.aviationbenefitsbeyondborders.org/download-abbb-report
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industry and contributes $539 billion to global GDP. Compared with the GDP contribution of
other sectors, the global air transport industry is larger than the pharmaceuticals ($445
billion), the textiles ($236 billion) or the automotive industries ($484 billion) and around half
as big as the global chemicals ($977 billion) and food and beverage ($1,162 billion) sectors.
In fact, if air transport were a country, its GDP would rank it 19th in the world, roughly equal
to that of Switzerland or Poland.
In 2030, forecasts suggest that there will be nearly 6 billion passengers and aviation will
support nearly 82 million jobs and $6.9 trillion in economic activity.
4. Turkish Airlines
Turkish Airlines Incorporation that was established in 1933 and named shortly THY was
called The State Airlines Administration when first established. It has taken action as
incorporation that it is called today. At first it started to fly by using 5 aircrafts. The first
international voyage Atina was flown in 1947. Turkish Airlines offered about 50% of shares
to the public in 2006 and they were traded at Istanbul Stock Exchange. In addition, it had 50%
of partnership in Sun Express centered in Antalya by making an agreement with German
airline Lufthansa in 1989 and invested in Sarajevo airline Bosnia and Herzegovina Airlines by
purchasing 49% of shares. Company established AnadoluJet centered in Ankara to serve all
people in Turkey in 2008. It joined oldest airlines alliance of world, Star Alliance, by making
an agreement in Istanbul in 2008. On the other hand, Turkish Airlines was named Turkish
Airlines Cargo has taken action its cargo service in 1936 and changed its name to TURKISH
CARGO in 2000. Turkish Airlines that owned 6 cargo aircrafts had totally 179 aircrafts.
Company grows by purchasing new aircrafts continuously and also develops its cargo
services. At the end of 2011 it reached of totally 189 cities including 40 cities for domestic
and 149 cities for international. Simultaneously it has 2 technical maintenance centers in
Istanbul. Turkish Airlines Technical Incorporation that is one of these centers was established
in Atatürk Airport in 2006 and has become an important technical maintenance point in air
transportation. Other center, Aviation Maintenance Repair and Modification Center
Incorporation (HABOM), was founded in Sabiha Gökçen Airport in 201126.
After World War II with global economy, aviation industry also developed rapidly. With
increasing population and income level, there were changes in travel expenditures and
behaviours. As a results of these developments, new infrastructure, routes, airfares and offers
was served up in aviation industry. The importance of social, economical and environmental
purposes and preservation, improvement and balancement of resources were understood. For
these purposes, Turkish Airlines shows improvements in terms of sustainable development
that global community aims.
When mentioned about sustainable development, firstly, development without effecting
environment adversely might be mentioned. World is under threat of greenhouse gases such
as carbon dioxide, methane and ozone. In this sense, Turkish Airlines tries to decrease the
amount of carbon dioxide caused by aircrafts and other activities. Because of Fuel-Saving
Project implemented in 2008, Turkish Airlines saved jet fuels about 78.371.439 $ and
decreased carbon dioxide emission about 201.700 tons.

26 http://turkishairlines.com/tr-tr/kurumsal/tarihce
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Aviation industry was joined to the Carbon Emission Trading System that was valid from 1
January 2012. In this context, Turkish Airlines has to comply with regulations of European
Emission Trading Scheme (EU-ETS) as other airlines operating flights to Europe27.
Temel Kotil, General Manager of Turkish Airlines, said that they were working with
International Air Transport Association about fuel-saving. So, less fuel usage at flights, 30
million $ fuel-saving per year and significantly decreasing amount of carbon dioxide emission
was aimed28.
Activities about decreasing of damages to the environment and human health that derives
from airport facilities were initiated by Directorate General of Civil Aviation. In 2010, for
luggage transportation, vehicles with electricity started to be used instead of vehicles with fuel
at airports with heavy traffic. If airport facilities met certain conditions in the context of this
project, airports are taken to the category of “Green Airport” and facilities that met conditions
provide discounts in the service recipe29.
Aviation industry in Turkey has grown substantially for last decade. There were liberalization
steps in the industry that was closed to the open competition and under the monopoly of
Turkish Airlines until 200230. Between 2002-2010, average annual growth was 16% for air
traffic and 25,5% for passenger traffic31.
In 2009, while the aviation industry in the world downsized, Turkish Airlines continued to
develop and increased by 11%. Turkish Airlines carried 10,4 million passengers in 2003,
raised the number of passengers to 22,5 million in 2008, 25,1 million in 2009, 29,1 million in
2010 and 32,6 million in 201132. In 2011, among the member airlines of Association of
European Airlines, it ranged fourth with 8,7% market share in terms of number of passengers
and fifth with 7,3% market share in terms of seat kilometers offered. While total number of
passengers of member airlines increased by 4,2%, Turkish Airlines raised by 15,6%. In
addition, Turkish Airlines is market leader in air cargo transportation in Turkey. It increased
its market share by 64% in 201133.
Turkish Airlines implements efficiency-oriented employment program. Its total number of
personnel was 10.239 people in 2003 and raised by 15.491 people in 2011. To become the
best airline in the world, the best cabin crew is required as a return of differentiation in the
service concept. From this point, Turkish Airlines applied “Service Quality and Increasing
Passenger Satisfaction Programme” since August, 201034.
27 http://turkishairlines.com/tr-TR/faaliyet-raporu/2010/pdf/tr-thy2010.pdf
28 http://hurriyet.com.tr/ekonomi/15229951.asp
29 http://shgm.gov.tr/greenairport.pdf
30 http://invest.gov.tr/tr-TR/infocenter/publications/Documents/TURIZM.SEKTORU.pdf
31 http://shgm.gov.tr/doc4/2010fr.pdf
32 http://turkishairlines.com/tr-tr/kurumsal/basin-odasi/THY/yolcu-sayisi
33 http://thy.com/download/investor_relations/annual_reports/faaliyet_raporu_aralik_2011.pdf
34 http://turkishairlines.com/tr-tr/kurumsal/basin-odasi/THY/is-gucu
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Company also gives promotion tickets, companion tickets and opportunity to upgrade to the
members with Miles&amp;Smiles Programme. At the same time, call center which is one of the
most important marketing and sales channel were included in the service as of 200935.
Turkish Airlines achieved significant successes in context of brand invesments. Sponsorship
of Euroleague, FC Barcelona and Manchester United has provided a great advantage in the
European market. There were other sports sponsorships. On the other hand, Kevin Costner,
Caroline Wozniacki, Kobe Bryant and Novak Djokovic were brand face of Turkish Airlines
with the slogan of “Globally Yours” and company has increased brand awareness. In the
sense of financial discipline, one of the most important keys of sustainable development,
Turkish Airlines applies long-term value-based growth programme and effective cost
management. Aviation Week Magazine, leading broadcasting organizations of aviation
industry, identified Turkish Airlines as the best airline from the point of financial situation in
2010. It has given “The Best Airline of Europe”, “The Best Airline of South Europe” and
“The Best Premium Economy Seat” by “Skytrax World Airline Awards” organization, known
as the Oscars of aviation industry. Turkish Do&amp;Co catering company, joint of Turkish
Airlines, was awarded as the best of world with the catering service in economy class.
Furthermore, it achieves “The Best Market Leader” of 2010 in the context of Air Transport
World Airline Industry Achievement Awards, accepted one of the most prestigious awards of
aviation industry36.
Turkish Airlines also sustains activities about culture, art and social responsibility. It has
supported Istanbul, 2010 European Capital of Culture, as “Capital Sponsorship”. According to
the contract with Turkish Red Crescent, company contributes victims of natural catastrophes.
Moreover, by planting 5.000 saplings it made up “THY Technical Commemorative Forest” in
Kurtköy and Kemerburgaz37.
5.CONCLUSION
This paper has attempted to show how sustainable development in aviation industry is
important for global world. Sustainable development seeks to protect, develop and balance
social, economic and environmental goals and resources in order to secure comfort and
welfare of present and future generations. Aviation industry is the safest and most efficient
transport type. Industry meets the society’s air transport needs by establishing relationship
with employees, local communities, customers and industry partners. A competitive and
commercial viable aviation industry makes a positive contribution to the world economy.
Aviation industry generates $2.2 trillion in 2010 and it equals to 3.5% per cent of global GDP.
Around the world industry supports 56.6 million jobs. Emission is a huge problem standing
that the future generations will face tragically. New aircrafts are 70 % more fuel efficient than
40 years ago and 20 % better than 10 years ago. In 2050, industry aims to decrease carbon
emission to be half of what it was 2005.
The importance of social, economical and environmental purposes and preservation,
improvement and balancement of resources were understood. For these purposes, Turkish
35 http://turkishairlines.com/tr-TR/faaliyet-raporu/2010/pdf/tr-thy2010.pdf
36 http://thy.com/download/investor_relations/annual_reports/faaliyet_raporu_aralik_2011.pdf
37 http://turkishairlines.com/tr-TR/faaliyet-raporu/2010/pdf/tr-thy2010.pdf
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Airlines shows improvements in terms of sustainable development that global community
aims. With its new generation aircrafts, Turkish Airlines tries to decrease the amount of
carbon dioxide caused by aircrafts and other activities and fuel consumption. Hence, it has
taken important steps about the sustainability by being a member of European Emission
Trading Scheme. In the sense of financial discipline, one of the most important keys of
sustainable development, Turkish Airlines has got remarkable performance by performing the
economic aspects of sustainable development. Company has to fulfil conditions what the
sustainability requires so it may survive in the market and become number one in avaition
industry around the world.
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Forecasting Carbon Emission For Turkey: Time Series Analysis
Mehmet Mercan1, Etem Karakaya2
1Hakkari University, Faculty of Economic and Administrative Science
2Adnan Menderes University, Faculty of Economic and Administrative Science
E-mail: mmercan48@gmail.com; mehmetmercan@hakkari.edu.tr, ekarakaya@gmail.com
Abstract
Within the context of sustainable development objectives, reducing greenhouse gas emissions
(GHG) that cause climate change was first discussed and officially negotiated at the 1992 Rio
Conference, which particularly emphasised developed countries to take serious measures.
Then, it was followed by the Kyoto Protocol, which specified national ghg emission reduction
targets for developed countries. With Kyoto Protocol, it was decided for these countries to
reduce global emissions by 5% below 1990 levels compared to 2008-2012 emission levels.
Turkey became a party to the Kyoto Protocol in 2009, yet due to their special circumstances
they did not take any emission reduction commitments.. Negotiations on Post-2012 emission
reduction obligations are still in progress under the UNFCCC umbrella and it is expected to
have emission reduction targets not only by developed countries but also by developing ones.
In this regard, it is important for Turkey to estimate its future ghg emissions, if they have to
take a Nationally Appropriate Mitigation Actions (NAMA) for their strategy. There are
various ghg emission estimations for 2020 and the results indicate different emission levels.
167

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                <text>The aquarium fish occupies an important place in hobby industry. When to increase the profit  margin in trading, despite of filling a small amount of oxygen and water into plastic packages,  they put into a large number of aquarium fish were identified from wholesalers. This leads to  stress on the fish. The quality of water inside the package deteriorates for reasons such as  rapid breathing and metabolic intensity. During transport or after, this situation can lead a  portion of fish to death. This is resulted being pecuniary and interest loss from this hobby.  Anesthetic agent is added to prevent this situation from carrying packages. Most of these  chemicals are not organic. Clove oil, containing the active ingredient eugenol, has been  determined to be an inexpensive and effective fish anaesthetic. It is known to be used safely in  aquaculture. In Aquaculture practical studies have been used such as tags, transportation,  shipping, vaccine etc. It is known that Clove oil is not harm to the environment. For the users  it is in a safe substance. This study is determining the lowest dose of clove oil of transport or  handling of some aquarium fishes for reduces their stress.  Keywords: clove oil, eugenol, anaesthesia, sedative, aquarium fish, ornamental fish</text>
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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Pamukçu, T. and Yeldan, E. (2005) “Country Profile: Turkey, Macroeconomic Policy and
Recent Economic Performance” Report prepared for Economic Research Forum,
http://www.bilkent.edu.tr/~yeldane/FEMISE_Macro2005.pdf.
Spilimbergo, A., Symansky, S., Blanchard, O. and Cottarelli, C. (2008) “Fiscal Policy for the
Crisis”
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Şenses, F. and Taymaz, E. (2003) “Unutulan Bir Toplumsal Amaç: Sanayileşme Ne oluyor?
Ne olmalı?”, in İktisat Üzerine Yazılar II, İktisadi Kalkınma, Kriz ve İstikrar, Oktar Türel’e
Armağan, (ed. A.H.Köse, F.Şenses and E. Yeldan), İletişim Publishing, İstanbul, 429-461.
Türel, O. (2007) “Türkiye’de Sanayileşme ve Kalkınma Planları Dönemsel Uygulamalar”
TMMOB Industry Congress, Ankara.

Consequences of financial crisis in Bosnia and Herzegovina
Fiscal and Monetary Policy
Nađa Dreca
International University of Sarajevo,Faculty of Business and Administration
71000, Sarajevo, Bosnia and Herzegovina
E-mails: nadja.dreca@students.ius.edu.ba, nadja_n88@hotmail.com
Abstract
Aim of this paper is to analyze effects did global financial crisis have on BiH’s economy and
society in general. After examination of effects, it will be researched what are the policies
that government has implemented in order to decrease negative effects. Both, fiscal and
monetary policies will be examined, with special emphasize will on the stand by arrangement
with IMF because it was often debated whether this arrangement was good or wrong
movement of the government. Moreover, this paper will provide information about have did
these measures affect society and especially certain interest groups, such as demobilized
military. Finally when all of these above mentioned are analyzed and discussed, conclusions
about efficiency of implemented policies will be made and proposals of what could be done
will be developed.
Keywords: global crisis, Monetary policy, Fiscal Policy, Central Bank
1. INTRODUCTION
Government of Bosnia and Herzegovina introduced some measures aimed in cutting public
administration costs and urge state-owned enterprise to devise saving plans. Bosnian
government encourages public spending, new capital investments, building roads, open new
projects. To conclude, BiH was doing pretty well until 2008, registering decent levels of
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economic growth. As the crisis hit Europe, economic growth substantially slowed down,
huge public deficit took place and the only solution to prevent absolute collapse was to get
the loan from the International Monetary Fund. All of the fiscal policies had some effect, but
they created social problems. On the other side, since Central Bank has only limited tools and
thus, monetary policy could not do much.
2. EFFECTS OF FINANCIAL CRISIS ON BIH ECONOMY
Previous to the 2008 and global financial crisis, BiH was considered as the most stable
economy in the Western Balkans. Of the great importance for macroeconomic stability at that
time was that the currency has been pegged to the euro, which ultimately protected it form
the fluctuations and created stability. Furthermore, economy was performing better and
country was experiencing slow but continuous growth in GDP. Since BiH is approaching EU
integration, much faster economic growth with higher GDP increase is required in order to
catch up with EU member countries. However, when crisis hit BiH this ambition for caching
up complicated further because GDP growth has immediately slowed down, due to the
reduced exports, remittances and credit. Finally, in 2010 some signals of slow recovery have
shown.
When talking about this crisis, inflation is usually perceived as one of the greatest problems.
Year
% change in CPI

2007

2008

2009

2010

1.5

7.4

-0.4

2.1

Table 1. Inflation
From the table above it can be concluded that crisis created high inflation, especially in the
2008 when retail prices increased by 7.4%. This big increase of price level was caused by
extraordinary rise in energy and food prices on world markets in the first months of 2008.
Regarding financial inflows before the crisis, the highest percentage of these inflows were in
the form of foreign direct investment (FDI). In 2007 FDI grow but in the following years it
started decreasing and currently FDI represents approximately around 1% of GDP. It is
important to emphasize that beside the financial crisis, the second highest problem why FDI
has drastically decreased is complex political situation and insecurity.
Since the war ended unemployment is constantly high. Business cycle is very slow, not many
jobs are being created, so the unemployment persists to be one of the leading problems.
Existing economic crisis, as previously mentioned, had slowed business cycle further,
production decreased and consequently unemployment rose. Regarding sectors that were first
to feel the effects of global financial crisis, these are the strongest export sectors, metal
industry and also building and industry of construction. Some of the most successful
companies in the metal industry, such as Arcelor Mittal Zenica and ASA Prevent have
already in 2008 decreased their production by 20-50%. In some Cantors there is need for
approximately million KM per month to cover only the basic contribution for the new
unemployed persons. So, number of unemployed is continuously increasing, while
government is trying to implement austerity measures of cutting social expenditures.
Increasing demand for social benefits and reduction in government spending created
atmosphere of general dissatisfaction, strikes and social unrest.

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The movements of public revenues and expenditures indicates that significant further
worsening of the country’s fiscal position occurred and that fisical deficite increased further.
It is evident that revenues were gradually decreasing and this was mainly due to the decrease
in colection from taxes and lower collection came as a result of decreased consumption. On
the other side austerity measueres that were enforced as an effect had decrease in government
expenditures
Further more, economic shocks have also caused an increase in the grey economy which
represented significant problem even before the economic crisis. In the research about crisis
and grey economy in the BiH, PhD Rajko Tomas showed that actual portion of grey economy
in 2008 was approximately 60%. It can be argued that this percentage has increased even
more in past two years because of the crisis and because of introduction of fiscal cash
machine . Introduction of fiscal cash machine hurt small business the most and caused high
percentage of these to exit from the market.
3. MONETARY AND FISCAL POLICY
As the negative impacts of the global crisis make their way across Bosnia and Herzegovina,
governments are employing different mechanism to improve their competitiveness and
encourage economic activities. As a first step, improving competitiveness can come through
currency depreciation, but in the case of Bosnia and Herzegovina it cannot be adopted
because Bosnian currency is pegged to the euro through a Currency Board. Beyond currency
depreciation, the Bosnia could employ other monetary and fiscal policy instruments to ease
adjustment and encourage economic activity, including financial spending programs o
encourage aggregate demand or loosening of lending controls to increase liquidity in the
banking system. Central Banks in the region of Bosnia cut their policy rates, but for Bosnia
and Herzegovina the only available macroeconomic policy was reduction of minimum
reserve requirements and requirements for funds borrowed from abroad. Also Central Bank
of Bosnia and Herzegovina exempted funds in foreign currency from reserve requirements. In
2008, it cut reserve ratio for all deposits from 18% to 14% by increasing the liquidity and free
credit potential, is aimed at stimulating banks to keep the growth rate of the lending activity
which was considerably slowed down. The tendency of slow-down of growth of bank lending
to private sector started.
As the tendency of decrease of activities in the local credit market continued, the Governing
Board of the Central Bank of Bosnia and Herzegovina in November 2008, passed a decision
according to which all the new credit lines withdrawn by commercial banks from foreign
countries should be excluded from the base for required reserve calculation. This measure
was aimed at stimulating the inflow of capital from foreign countries in the local banking
sector and providing additional incentives to the credit activity of commercial banks. In
December 2008, the Governing Board also passed a decision on introducing a differentiated
rate of required reserve on commercial bank deposits. The purpose of this decision is to
release additional liquid funds from the required reserve for commercial banks, in order to
stimulate larger credit activity in attempts to make a positive influence on the level of
economic activity in the country.
Also new decision about deposit insurance limit is brought, new amount increased from
7.500 to 20.000 KM, and Deposit Insurance Agency provides insurance of deposits in
commercial banks in the amount of 35.000KM per person.
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The influence of the financial crisis in 2008 was indirectly felt in BH economy as well,
particularly in its financial sector. Slowing of capital inflows from abroad and withdrawal of
deposits from domestic commercial banks, which partly contributed to the negative balance
of sales and purchases of KM, as well as a reduced pace of growth of credit activities of
banks resulted in a considerably slower growth of money supply relative to previous years.
In 2009, the banking sector in BH, despite strong effects of the world economic crisis,
managed to maintain stability and responds successfully to clients’ demands, which served to
safeguard the confidence in the banking system. In order to mitigate negative effects of the
global financial crisis, around the middle of the year the banking agencies adopted the
Decision on Temporary Measures for Reprogramming of Credit Liabilities of Physical
Persons in Banks, which allowed banks to reprogram all obligations of a debtor’s at his
request.
The slow-down of capital inflows from foreign countries and the withdrawal of deposits from
the local commercial banks, which partly contributed to the negative balance of KM sale and
purchase, and also the decline of the growth rate of bank lending activities resulted in a
significantly slower growth of money supply.
3.1 Fiscal Policy
Government of Bosnia and Herzegovina introduced some measures aimed in cutting public
administration costs and urge state-owned enterprise to devise saving plans. Bosnian
government encourages public spending, new capital investments, building roads, open new
projects.
Letter of Intent
In early May 2009, members of the Fiscal Council of BH and delegation of the International
Monetary Fund (IMF) harmonized a Letter of Intent that was forwarded to the Governing and
Executive Board of IMF, in which a three-year Stand by arrangement was agreed for Bosnia
and Herzegovina in the amount of EUR 1.2 billion with annual installments of EUR 400
million each
In the Letter of Intent they proposed many policies in order to decrease budget deficit. One of
them was end 2009, we intend to: (i) eliminate special unemployment benefits granted to
demobilized soldiers by allowing the sunset clause to expire; (ii) introduce a maximum
income threshold for eligibility for civilian and veterans benefits; (iii) reduce all civilian and
veterans’ benefits by 10 percent and eliminate indexation; and (iv) reform war veterans’
pensions. These reforms will entail the revision of existing legislation, including: (i) Decree
on eligibility for pension under more favorable conditions of the military insurees of the
Army of FBiH; (ii) Decree on eligibility for age pension under more favorable conditions of
the military insurees of the Army of FBiH; and (iii) Decree on eligibility for age pension
under more favorable conditions of the members of the former Army of FBiH and civil
servants and employees of the former Ministry of Defense of FBiH.
IMF Stand-By Arrangement
Faced with increasing financing pressures in early 2009, the authorities put together a
comprehensive program supported by an IMF Stand-By Arrangement. The program was
designed to safeguard the currency board and cushion the effects of the deteriorating external
environment, while adopting policies to correct fiscal imbalances and strengthen the financial
sector. The authorities’ approach included: (i) gradual fiscal consolidation accompanied by
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structural fiscal reforms to bring public finances on a sustainable path; (ii) steps to strengthen
the resilience of the financial sector alongside commitments by foreign parent banks to
maintain their external exposures to BiH and keep their subsidiaries capitalized; and (iii)
substantial financing from the Fund along with funds from the World Bank and the EU.
The program helped mitigate the impact of the crisis on the economy. Private investment and
spending on consumer durables collapsed, while private current consumption softened to a
lesser extent, on the back of moderate growth of wages and social benefits. The drop in
domestic demand appears to be leveling off, aided by stabilizing credit conditions. Private
investment, however, continues to lose ground as a result of weak FDI inflows.
Results of Stand – By Arrangement
The program helped mitigate the impact of the crisis on the economy. Inflation has
decelerated.
The Federation government approved with a delay the pension reform strategy in June 2010,
and parliament adopted the public wage legislation in July 2010 (both end-March structural
benchmarks). Eligibility audits of war benefit recipients started only in July and are yet to
produce any tangible results (continuous benchmark from start of year). The end-March
structural benchmark on the reform of privileged pensions, which was missed by the
Federation, was also redesigned .In Republika of Srpska, all end-March 2010 benchmarks
related to eligibility audits, the reform of privileged pensions, and the pension reform have
been met.
By the end of the Stand by Arrangements, the level of Fund credit outstanding is projected to
reach 8.5 percent of GDP, and Fund repurchases and charges would peak at 63 percent of
total debt service in 2014. The country’s excellent record of meeting Fund financial
obligations, the expectation that the program would lay the foundations for the return to a
sustainable medium-term growth path, and a strong political commitment to the program
provide assurances that B&amp;H should be able to meet its financial obligations at defined time.
Fiscal coordination was improved. Since its establishment in 2008, the role of the Fiscal
Council in coordinating fiscal policy across the country has been limited. It is important that
the authorities take steps to improve the Council’s operational framework and involve it in
the design of medium-term fiscal policy and fiscal targets.
The establishment of the Fiscal Council in 2008 represents an important step in advancing
national fiscal policy coordination. Recently, there have been increases of excises to align tax
rates with EU levels, but discretionary revenue gains were partly offset by declining customs
collections owing to EU accession. Direct taxes were lowered and exemptions re-defined.
Tax administration has also improved and, contrary to the experience in many countries,
collection does not seem to have suffered during the recent crisis. On the expenditure side,
progressive increases in wages and social benefits have occurred since 2006 in a pro-cyclical
fashion, dampening the effect of the automatic stabilizers. Unemployment benefits, which
generally act as a counter-cyclical force on the expenditure side, have increased during good
times with the rights awarded to demobilized soldiers in the Federation.
During the period of crisis Bosnian government propose some discretionary revenue
measures. In 2008 Association Agreement with EU (lowered import tariffs on EU goods) was
made. In 2009 Increase in the road fee (+0.10 KM/l), excises on coffee and progressive
increase in excises on tobacco.

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With monetary policy assigned to maintain the currency board arrangement, fiscal policy was
the only available instrument to soften the economic downturn. However, given the starting
unsustainable fiscal position, a discretionary fiscal stimulus was not a policy option.
During these period in Bosnia and Herzegovina some reforms were adopted, such as Rightsbased benefits reform. Much of the spending pressure affecting the fiscal accounts over the
past few years stems from poorly targeted and inefficient rights-based benefits. There was
agreement on the need to press ahead with the implementation of the reform of the system of
rights-based benefits according to the action plan prepared in consultation with the World
Bank. Faced with increasing demographic pressures, the authorities have initiated reforms of
the pension systems. The Federation approved a pension reform strategy, which still needs to
be fleshed out in greater detail and to incorporate an overhaul of privileged pensions. In the
RS, with the pension reform strategy already approved by parliament, the authorities need to
follow through with the preparation and adoption of pertinent legislation.
Reforms to rein in the wage bill was also implemented. BiH’s government payroll has grown
substantially in recent years and is very high compared with other countries. There is still a
need for deeper reform of public administration.
4. CONCLUSION AND PROPOSALS OF MEASURES
To conclude, BiH was doing pretty well until 2008, registering decent levels of economic
growth. As the crisis hit Europe, economic growth substantially slowed down, huge public
deficit took place and the only solution to prevent absolute collapse was to get the loan from
the International Monetary Fund. All of the fiscal policies had some effect, but they created
social problems. On the other side, since Central Bank has only limited tools and thus,
monetary policy could not do much.
In the case of Bosnia and Herzegovina the best way to correct consequences of crisis is to
change policy of public finance, to decrease the budget deficit and decrease of public deficit.
Main problem and weakness for Bosnian financial system is so high level of the benefits
provided to special groups of citizens and thus it is absolutely necessary to make reforms
regarding spending on these benefits.
Further more, it would be good if more flexible mechanism of the use of required reserves of
the Central Bank through use of the securities would be introduced and if Central Banks
would get the right to set the interest rate of the commercial banks. Of especially help would
be establishment of domestic bank which would than help development and support new
investments and development of the Bosnian financial sector.
Government should provide help to the domestic companies in order to keep their status on
the market, to keep stable unemployment rate and increase their competitiveness. One of the
measures that could be is the increase in the level of the public sector works that will create
jobs.
Sector of economy that should be supported the most heavily is agricultural sector, to
encourage the production of the agricultural goods that are currently being imported and
increase consumption of domestically produced goods. These will lead also to the increase in
GDP of the country and help export expansion.
Finally, introduction of progressive taxation could create some positive results, but detailed
cost-benefit analysis should be done in order to evaluate whether this type of taxation would
increase government revenues.
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REFERENCES
Agency of Statistics of Bosnia and Herzegovina www.bhas.ba
“Bosnia and Herzegovina: Letter of Intent and Technical Memorandum of Understanding“,
Published:June 16, 2009, Available at IMF officaila page www.imf.org,
“Bosnia and Herzegovina: Letter of Intent and Technical Memorandum of Understanding“,
Published:June 16, 2009, Available at IMF offical page www.imf.org
Central Bank of Bosnia and Herzegovina, Various Issues, www.cbbh.ba
Consequences of the global financial crisis on BiH economy“, Source: FENA, Published:
December 30, 2008., http://www.emportal.rs/en/news/region/74519.html
International Monetary Fund. http://www.imf.org/external/np/sec/pr/2010/pr10111.htm , .
http://www.imf.org/external/pubs/ft/scr/2010/cr10348.pdf
“The Western Balkans: Between the Economic Crisis and the European Perspective”,
Institute for Regional and International Studies, Sofia, September 2010, page.52
http://www.iris-bg.org/files/The%20Western%20Balkans.pdf,

2008 Global Crisis, The Case Struggle Turkey
“You are the Privileged, give us lessons”*
Bulut Şahin1, Göçer İsmet1, Dam M. Metin1, Mercan Mehmet2
Martin Wolf, Financal Times' chief economic commentator.
1Adnan Menderes University, Faculty of Economics and Administrative Sciences,
Department of Economics, Aydin, Turkey
2Lec. Hakkari University, Faculty of Economics and Administrative Sciences, Department of
Economics, Aydin, Turkey
E-mails: sbulut@adu.edu.tr, igocer@adu.edu.tr, mdam@adu.edu.tr, sbulut@adu.edu.tr
Abstract
In this survey, how Turkey overcame the 2008 crisis was studied using 2002:1-2011:12
period data through co-integration test. Within the scope of Empiric analysis, the influence of
397

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                <text>Aim of this paper is to analyze effects did global financial crisis have on BiH’s economy and  society in general. After examination of effects, it will be researched what are the policies  that government has implemented in order to decrease negative effects. Both, fiscal and  monetary policies will be examined, with special emphasize will on the stand by arrangement  with IMF because it was often debated whether this arrangement was good or wrong  movement of the government. Moreover, this paper will provide information about have did  these measures affect society and especially certain interest groups, such as demobilized  military. Finally when all of these above mentioned are analyzed and discussed, conclusions  about efficiency of implemented policies will be made and proposals of what could be done  will be developed.  Keywords: global crisis, Monetary policy, Fiscal Policy, Central Bank</text>
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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Seokjin, K. &amp; Behnam, N., 2008. The Dynamics of Quality Costs in Continuous
Improvement. International Journal of Quality &amp; Reliability Management, pp. 842-859.
Sipahi, B. &amp; Yıldırım, H., 2004. Kalite Maliyetleri Muhasebesi ve İstatistiksel Analizi.
İstanbul: Türkmen Kitapevi.
Şimşek, M., 2001. Toplam Kalite Yönetimi. İstanbul: Alfa Yayınları.
Tsai, W. -. H., 1998. Quality Cost Measurement Under Activity-Based Costing. International
Journal of Quality and Reliability Management, pp. 719-752.
Vahevanidis, N. M., Petropouolos, G., Avakumovic, J. &amp; Mourlas, A., 2009. Cost Of Quality
Models And Their Implementation In Manufacturing Firms. International Journal for Quality
Research, pp. 27-36.

Evaluation of Financial Performance of Banking Sector: Evidence from Bosnia and
Herzegovina, Croatia, Serbia and Slovenia
Nađa Dreca
International University of Sarajevo,Faculty of Business and Administration
71000, Sarajevo, Bosnia and Herzegovina
E-mails: nadja.dreca@students.ius.edu.ba, nadja_n88@hotmail.com
Abstract
The objective of this study is to compare the financial performance of the banking sector in
some ex- Yu countries: Bosnia and Herzegovina, Croatia, Slovenia and Serbia for period from
2005 to 2010. Banking sector of Yugoslavia was strong but because of the weakness and the
collapse all these characteristics disappeared. The financial performance of banks is study on
the basis of some selected financial variables and ratios, such as return on asset, return on
equity, capital adequacy ratio, share of non-performing loans in total loans, participation of
deposits, assets and loans in Gross Domestic Product of the country. All of the indicators
improved in period until the beginning of the global crisis, but with the first signs of crisis the
conditions in entire economy worsen as well as the situation in the banking sector. Data show
that banking system of these countries suffers from problems largely influenced by its huge
debt to IMF, political situation, financial crisis, internal situation and other political factors.
The authorities of banking system in selected countries took some measures in order to
improve financial position and to slowdown the negative consequences of the global crisis.
Keywords: Banks, ROA, ROE, Non-performing loans, Reforms, Crisis
1. INTRODUCTION
The banking sector is considered to be an important source of financing for most businesses.
Increase in the financial performance leads to more improved functions and activities of any
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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

organization. It has effect on total economy of the country, because banks are the sources of
finance for better job opportunities; develop of new ideas; research and overall prosperity.
The factors that influence performance of banks are: bank size measured by its assets,
profitability measured by returns on assets and equity, size of deposits and loans, as well as
the percentage of non- performing loans in the total loans.
2. BANKING SYSTEM
The Socialist Federal Republic of Yugoslavia (SFRY) was very important in each field, in
economic and political. It had great impact on its member republics. All banks were
nationalized. The system had social characteristics, introduced two-tier banking system in 60s
when it left the Soviet style mono-banking system, and in 80s Yugoslavia was the most
developed and the largest country in the region. The strong Yugoslavia represented a great
base for development of the strong and healthy banking system. The system had social
characteristics, introduced two-tier banking system in 60s when it left the Soviet style monobanking system, and in 80s Yugoslavia was the most developed and the largest country in the
region. In 1980s the Yugoslavia experienced crisis that were caused by a high exchange rate,
a high fiscal deficit, and low performance in trade that were the consequences of the big
recession and international crisis. During that period, national currency, Dinar, highly
depreciated and it leads to the difficulties in repaying foreign loans that in previous century
were taken. The government started to promote the Markovic anti-inflation program to make
faster economic stabilization. The plan allowed the establishment of private and mixed firms.
These new reforms were interrupted by the weakness and collapse of the SFRY. (Simon
2012)
The reforms of the banking system started in 1990s. Those reforms happened after the
breaking the SFRY and separation of its republics. Separation started first in year 1991 with
small military conflict in Slovenia, then Croatia (1991-1992) and Bosnia and Herzegovina
(1992-1995). The military conflicts, hyperinflation, high unemployment rates and other
reasons influence the flow of the political and the economic reforms. These negatively
influence the position of all former republics and took away all advantages they had before as
the part of the SFRY. ( Radzic and Yuce 2008)
Reforms in each country are made in order to make transformation of the socialist banking
system into a new organizational form. The privatization of the banks was the most important
element in the rehabilitation of the banking sector. Privatization was caused by the entrance of
the foreign banks and increase in the capital shares. It was made to bring new capital and to
help bank reconstruction. The foreign banks brought new way of business and new banking
products on this market.
The main changes in banking system that reforms brought are:
The privatization of state owned banks and the closure of insolvent institutions
The writing- off of non-performing loans
The entry of foreign banks either by establishing an autonomous presence or by taking over
local banks
The adoption of regulations according to international standards and practices
The implementation of tighter and more effective supervision exercised by the central banks
and currency boards. (Stubos 2005)

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3. ANALYSIS AND DISCUSSION
Whole economic situation in the country has impact on the banking sector. The period of
crisis is marked by the worse condition in the economy. As the Table 1 presents each country
experienced the decrease in these indicators in period of crisis.
Table 1: Key Economic Figures

Source: National Sources, Raiffeisen RESEARCH
Number of the banks in the selected countries changed over the time. The number of banks in
each country, in 2010 compared to 2005 decline mostly because many banks merge with each
other or by some regulations some banks are closed. Foreign banks entrance was done either
by acquisition of local banks or establishment of their own subsidiaries or branches. Foreign
banks brought more confidence and safety in the banking sector, so that assets and deposits
increased. (Ilgun and Coskun 2009)
Table 2: Number of Banks

Source: CBBH, CNB, NBS, BSI
As it is shown in Table 3 deposits of all countries grew, except in 2008 when it decreased due
to first impact of financial crisis. Deposits of other three countries continue to grow after the
crisis, but only Slovenia recorded negative deposit growth. Due to return of confidence in
banks and increase in savings also the deposits of banks increased in last year. Deposits from
households represent the key factor in the banking service. In period of crisis because of the
large risk, citizens mostly did withdrawal from their accounts or they tried to do
diversification of the risk, so they left some portion of their deposits on the accounts and part
withdraw. The year 2008 is the year in which the citizens mostly lost the confidence in their
banks and remove their deposits. Second part of Table 3 represents the share of the deposits of
households in GDP. In 2009 the deposits increased due to reconstruction of confidence in
banks, new policy of the banks to attract again back the depositors. Increase in deposits from
households was creates opportunities for the increase in the supplied loans and brings
stimulants in the lending activity.
Table 3: Total Deposits in % of GDP and Deposits from Households in % of GDP

Source: CBBH, NBS,CNB,BSI, Raiffeisen RESERCH, Author

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Clients for the needs of financial activities use the banking services as dominant source of
finance.
Table 4: Total Loans, Loans to Households and Loans to private enterprises in % of GDP

Source: CBBH, NBS,CNB,BSI, Raiffeisen RESERCH, Author
Table above shows that loans have positive growth over the time.Banks started to implement
more restrictive politics and it slowdown loans growth. The most significant factor that
influence the limitation of the credit growth is the crisis that had impact on the entire
economy and worse the condition in the real sector, then decrease in citizen`s spending, and
more restrictive and prudent lending policies of banks. Due to the global economic crisis,
consumption was reduced, as well as the volume of activities of domestic firms, which led to
decline on demand for new loans. At the same time, credit conditions worsened and interest
rate rose. Irregularity of debt servicing by clients increased and the banks put more attention
to the credit risk exposure. Economic crisis influenced the demand for the loans. In the years
when most people lost their jobs or salary decreased, their creditworthiness decrease and the
banks impose more restrictive policy that leads to decrease in the growth of the loans. Growth
rate in the loans to households is not high as it was before due to existence of risk on the
financial markets, depreciation of currency and other factors that influence the decline in the
growth rate of loans. Even if there was increase in this ratio, it is not caused by the new loans
but taking loans to refinance existing one. The growth in credit provided to private enterprises
was caused by the rise of the costs of performing business, increase in input prices and some
other restrictive measures that crisis brought with itself. Increase in the loans to enterprises
was mostly due to the needs of financing the working capital and refinance of the existing
loans. Banks brought some measures in order to stimulate banking activities, lending and
accumulation of deposits, change reserve requirements, make some exception on calculation
of ratios, policy about currency ,they fund these changes partly from the internal sources as
well as lending from external sources etc.
Table 5 illustrated for the listed countries the total assets of the banking sector as percentage
of GDP in the period of 2005 to 2010. Slowing lending activities of the commercial banks
resulted in a decline of assets on 2009. The banks` asset quality deteriorated considerably as a
result of weakening creditworthiness of borrowers. The banking sector had a growth trend
over the past years, but it was stopped due to economic crisis. The increase in balance sheet
was partly due to bank recapitalization, the inflow of funds from stand-by arrangement, and
requalification of bad loans. In 2010 assets again decreases because of high participation of
non-performing loans and banks` loss.
Table 5: Total Assets in % of GDP

Source: CBBH, NBS,CNB,BSI, Raiffeisen RESERCH, Author
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The sign of growth of ROA and ROE is changing over the time.
Figure 3: ROA, ROE, and NPL (% in Total Loans) in B&amp;H, Croatia, Serbia and Slovenia

Source: CBBH, CNB, NBS, BSI, IMF
The banking sector was influenced by the economic crisis and recession, and one of the main
characteristics of this sector in 2010 was a decrease in profitability of banks. The assets
quality has the greatest impact on the profitability of banks. Decrease in ratio of NPL to total
loans can be explained by the increase in loans especially because most loans are long term
and also it influence the assets quality can be visible more in the long run. Increase in NPL
had greatest impact on profitability of banks.
The reason for decrease in profitability was increase in loan loss provision, increase in loan
delinquency, delay payments and downfall in interest and similar income. The profitability
improvement is the result of reform and implementation of the adjustment of non-performing
loans, introduction of modern banking techniques and increasing the rate of credit expansion.
The percentage of NPL in the total loans in the mentioned countries increases over the time.
The global financial crisis has large impact on this indicator.During the financial crisis there
was downfall of asset quality and increase of non-payable claims, produced by difficulties in
loan repayments. In 2010 banks did reclassification of the loans, and significant amount was
moved from B to nonperforming, that results in the increase of the loan losses and had
negative impact on financial performance. Due to poor performing receivables trend in delay
in collecting the past due loan receivables from customers, there were activated some
guarantees in a number of delinquent loans that had this type of insurance, so the burden of
the loan repayment fall on the guarantors.
Capital adequacy ratio is significant indicator of financial soundness. Figure 3 shows Capital
Adequacy ratio. As it is visible the ratio, all countries fluctuate over the time. Decrease in the
capital adequacy ratio is caused by high participation of the risky asserts. It is always higher
than minimum prescribed by law (Bosnia and Herzegovina and Serbia 12%, Croatia 10% and
Slovenia 8%) and it represents satisfactory capitalization of the entire system and very strong
basis and foundation to preserve its safety and stability. The restructure of state owned banks
and the injection of capital by governments improved capitalization significantly. Decrease in
CAR was due mainly to the increase in risk-weighted assets and increase of credit risk of
them.
Figure 3: Capital Adequacy Ratio

Source: CBBH, CNB, NBS, BSI, IMF
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4. CONCLUSION
This study provides analysis of banking sector performance measured by several indicators in
the three countries that were part of ex – Yugoslavia, Bosnia and Herzegovina, Croatia,
Slovenia and Serbia. Indicators show that banking sector is influenced by the global financial
crisis. The performance of the banking sector in last years was under the strong impact of the
global economic crisis and recession. This crisis produces many bad consequences and the
adverse effects in banking sector of those countries, such as stagnation of sector, decline in
profitability, increase of the non-performing assets and loans, past due receivables, loan loss
provision and deterioration of other key indicators of banks` performance. In 2010 banking
sector recorded the first signs of slight recovery but still there is no satisfactory condition to
grow faster, so the recovery will be slow and lengthy. Each country records decrease in
profitability ratios, merely due to decrease in profits, loss of provision, and increase in nonperforming loans, slowing credit activity and worsening market conditions. In order to make
financial situation countries took support from other sources, but in most cases it just
increased debt level and makes conditions worse. In order to improve the situation in banking
system better, banks should increase interest on deposits, decrease interest on loans especially
for the less risky clients, to provide better banking products that help everyone in market, such
as more credit cards with deferred payments on the markets; it helps everyone in way that
everyone is better off, client pays without interest, it is on time payment, and bank tied client
to the bank with issuing this product. More credits to small business should be provide, at the
lower interest rate and economy should encourage investments domestic producers should be
encouraged by more favorable conditions of borrowing also it will solve many economic
problems, decline in unemployment rate by creating job opportunities, less domestic products,
so it will decrease trade deficit, provide more income for domestic governments and decrease
budget deficit, and country would be in better position to return the debt to IMF.
REFERENCES
Bank of Slovenia, Annual Reports, various issues www.bsi.si
Bonin, J.P. (2001) Financial Intermediation in South East Europe: Banking On the Balkans,
Working
Paper
006,
The
WIW
Balkan
Observatory,URL
http: balkan observatory.net/wp/2001%2010%20wiiw%20bo%20wp%20006.pdf
Central Bank of Bosnia and Herzegovina, Annual Reports, various issues www.cbbh.ba
Croatian National Bank, Annual Reports, Various issues www.hnb.hr
Coskun, A. and Ilgun,E. (2009) Reconstruction and Development in the Banking Sector of
Bosnia and Herzegovina, 1. International Symposium on Sustainable Development, June
2009, Sarajevo,pp.52-63, URL http://www.alicoskun.net/Publications/Coskun-Ilgun-ISSD2009.pdf
International Monetary Fund , Financial access Survey (FAS), Financial Soundness Indicators
(FSIs) www.imf.org
National Bank of Serbia, Annual Reports, various issues www.nbs.rs
Radzic, J. and Yuce, A. (2008) Banking Development In The Former Yugoslavian Republics,
International Business and Economic Research Journal, Vol 7. No.9 pp.35-48

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Raiffeisen
Researh
CEE
Banking
Sector
Report
http://www.rbinternational.com/eBusiness/services/resources/media/677012584775275435677012584775275436_677251119927032833-772104317120223179-1-9-DE.pdf
Simon Jr, G. (2012) An Economic History of Socialist Yugoslvaia, Social Science Research
Network,
Rochester,
New
York,
Available
at
:
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1983907
Stubos, G. and Tsikripis, I.(2004) Banking Sector Developments in South –Eastern Europe,
Working Paper No.44, ELIAMEP, WP4,Regional Cooperation, ELIAMEP, Athens, Available
at: http://balkan-observatory.net/archive/stubos.pdf
Stubos, G. and Tsikripis, I.(2005) Regional Integration Challenges in South East Europe:
Banking Sector Trends , Working Paper, Bank of Greece
Available at:
http://www.bankofgreece.gr/BogEkdoseis/Paper200524.pdf

Basel II – Policy Implications and Implementation Challenges for Bosnia and
Herzegovina
Aida Bulbul, Ugur Ergun
International Burch University, Faculty of Economics
71000 Sarajevo, Bosnia and Herzegovina
E-mails: bulbul.aida@gmail.com, uergun@ibu.edu.ba
Abstract
The financial sector and international banking environment in particular has changed
dramatically over the past years. In order to reach and maintain stability and sustainability in
the global banking system, decrease risk of insolvency, and to cover unexpected losses,
countries (EU in particular) have started implementing the new capital adequacy rules (Basel
II) following the worldwide consensus among G-10 central bank Governors by which banks’
capital levels should be regulated to enhance global financial stability.
Since Bosnia and Herzegovina is still in the beginning of its path towards Basel II legislation
and implementation, using detailed literature review and an in-depth analysis this study
conducts a comparative analysis on the implementation of Basel II in Bosnia and
Herzegovina, Slovenia, Croatia, and Serbia, with regard to both the qualitative and
quantitative implementation details and issues which include the implementation stages,
progress, and timetables and particular challenges faced by the countries.
Moreover, study reveals Bosnia and Herzegovina’s unique situation, challenges and obstacles
on the path towards full implementation of Basel II standards and puts an emphasis on how
implementation and adoption will affect its banking and economic stability, future and
conditions.

74

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                <text>The objective of this study is to compare the financial performance of the banking sector in  some ex- Yu countries: Bosnia and Herzegovina, Croatia, Slovenia and Serbia for period from  2005 to 2010. Banking sector of Yugoslavia was strong but because of the weakness and the  collapse all these characteristics disappeared. The financial performance of banks is study on  the basis of some selected financial variables and ratios, such as return on asset, return on  equity, capital adequacy ratio, share of non-performing loans in total loans, participation of  deposits, assets and loans in Gross Domestic Product of the country. All of the indicators  improved in period until the beginning of the global crisis, but with the first signs of crisis the  conditions in entire economy worsen as well as the situation in the banking sector. Data show  that banking system of these countries suffers from problems largely influenced by its huge  debt to IMF, political situation, financial crisis, internal situation and other political factors.  The authorities of banking system in selected countries took some measures in order to  improve financial position and to slowdown the negative consequences of the global crisis.  Keywords: Banks, ROA, ROE, Non-performing loans, Reforms, Crisis</text>
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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Yıldız, F. F. &amp; Akdağ, K. (2006). Avrupa Birliği Yapısal Fonları Kapsamında Bölgesel
Kalkınma ile Kırsal Kalkınma Fonlarının Karşılaştırılması. Tarım ve Köyişleri Bakanlığı
Türktarım Dergisi, 167, 29–37.

Organization of Petroleum Exporting Countries (OPEC) and Role of Saudi Arabia
Nađa Dreca
International University of Sarajevo,Faculty of Business and Administration
71000, Sarajevo, Bosnia and Herzegovina
E-mails: nadja.dreca@students.ius.edu.ba, nadja_n88@hotmail.com

Abstract
The aim of this research is to explain the OPEC position and the role of Saudi Arabia within
OPEC. Saudi Arabia as the largest producer and country with largest oil reserves of oil attract
many attention and many studies try to explain which role Saudi Arabia plays within OPEC,
is it the role of dominant producer and which strategy Saudi Arabia used during its
membership in order to keep its position and its market share. Saudi Arabia role is to keep the
balance of production within OPEC. Saudi Arabia was explained as swing producer, and in
order to protect itself and its interest because of cheating of other members of OPEC, it was
forced to adopt the strategy tit-for-tat. There is big question of it is good to have dominant
producer, or all of them to be equal.
Keywords: OPEC, Saudi Arabia, Cartel, Oil prices, dominant producer
1. INTRODUCTION
Organization of Petroleum Exporting Countries (OPEC) is the international organization
composed of the twelve member states. These countries mainly depend on the revenues from
oil export. They work together in the coordination of the overall oil price in the world
market. OPEC is by market structure Cartel, which represents intergovernmental
organization. As it is stated in OPEC`s Statute it is an international organization with aim to
influence and maintain the price of oil through the control of production levels and to
generate revenue, which goes towards meeting the development needs of its members. By
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controlling production, by system of quotas, the OPEC has large influence on the
determination of the price on the world market. It is hard to distinguish what is OPEC
exactly, is it real cartel with cooperative or non-cooperating behavior. Every cartel face with
three factors that must be accomplished in order to properly function as the cartel:
coordination, cheating and entry. In the case for entry in OPEC case there is really high
barriers to entry, so new producers are prevented from entrance on the oil market. Cheating is
big problem in OPEC. Each country has incentive to cheat because the dominant strategy for
most of the OPEC members is cheating. Each member has different needs. OPEC imposes
production quotas to its members and meets twice a year to define their oil production
policies. If their coordination is effective there would not be any member that violates the
rule of quota. On the meeting the OPEC assigns the ceiling of the total output and assigns to
each member the share that it should produce. If the member cheats the cartel should be able
to detect and punish cheating. (Smith 2005) Aguiar-Conraria and Wen(2011) show that
equilibrium depends crucially on the cartel`s choice of the control variable: price or quantity.
According to the Hochman and Zilberman (2011) the OPEC is not economic but political
cartel among big-oil exporting countries, which set fuel policy to maximize aggregate
welfare. OPEC can be kind of the monopoly and can act as monopolist, but because there is
some oil supply by the non-OPEC countries it is cartel. Market of the oil is not competitive,
OPEC as a cartel fixes the output, production level, while other non- OPEC countries react to
satisfy world demand (leader-follower game). OPEC knows how others will react so it is able
to determine own demand and oil price so it defines its quota level to maximize own net
revenue. It is example of Stackelberg game, where OPEC is leader and followers are NonOPEC producers and oil consumers. Demand for the oil of the OPEC is residual demand.
There is still the question whether OPEC is a cartel or not.
The work by Gulen (1996) investigates if the OPEC is cartel through causality test. Causality
test should detect if the OPEC is able to affect prices by changing the production. Researches
done before try to explain the OPEC as a cartel or non-cartel model. Non –cartels models are
focused on competition, changes in ownership and revenue target modes. Cartel models
attempt to make the OPEC classification as the monopoly, oligopoly or dominant firm. Tests
done in the Kaufman et al 2008, reject the hypothesis about the competitive behavior,
changes in ownership and revenue target. Increase in the price of oil is affect by four factors:
capacity utilization by OPEC, production quotas established by OPEC, the degree to which
OPEC production exceeds these quotas and private stock crude oil that are held in OPEC
nations. It implies that OPEC through decisions about production, quotas, and operable
capacity can influence real prices of oil. Many studies try to describe the nature of OPEC. Is
it cartel or non-cartel market model? According to models the quotas have a statistically
measureable effect on crude oil production in most of the countries. OPEC quota decisions
influence the decision about price. Also it is shown that oil production by other OPEC nations
has a measurable effect on the own production of individual member of OPEC. (Kaufman et
al 2008) Many factors influence the production of oil by OPEC. Those factors are mostly:
price of oil and condition on market, the level of oil production by other producers that are
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not members of OPEC and the geopolitical environment. New discovered reserves of oil in
the other countries non –OPEC members leads to the increase in the oil supply on the
international level, with better technology and declines in the market share of OPEC. More
producers on the market increase the competition and brought market to more competitive
conditions and more competitive prices, so the OPEC abandoned the administer oil pricing
system in mid 80-s and moved to market-reference pricing based on the price quotas provided
by oil price reporting agencies. In the OPEC interest is to adjust production quotas in order to
achieve price target zone. Ability of OPEC to influence prices depends on the market
participants` expectations in the future markets. In order to keep the price target range in the
condition when the global oil demand declines, the OPEC would decrease production. These
decisions are dependent on the coordination efforts and bargaining power of OPEC member
countries. In the case of greater demand, OPEC would not respond immediately because of
the large uncertainty of future demand. Another limitation of oil production lies in the
unfavorable geopolitical climate in OPEC member countries regarding security and there
could be adopt the sanction that could have adverse impact on the investments and create
limitation of expansion of capacity. (Barros et al 2011).
The OPEC success is based on three factors: its overwhelmingly high share in world oil
supply, the absence of close substitutes and consequently the inelastic demand for oil, and
inelastic non- OPEC supply. (Panayotou 1978)
According to Bagheri 2011: In order to realize the goals OPEC does the following policy:
The excess production capacity in major producing member countries
The quota system by which member countries are obligated to consider the upper limits for
their oil production.
The OPEC use the excess production capacity to stabilize the price.
2. SAUDI ARABIA ROLE IN OPEC
As the largest world producer of oil role of Saudi Arabia in OPEC is discussed in many
articles. Saudi Arabia acted as swing producer in 80s with adjusting output of oil in order to
keep stable the production of oil and the price. After the persistent cheating of other
members, Saudi Arabia was forced to adopt tit –for- tat strategy to keep its market share.
Most stated that the Saudi Arabia is the leader in the OPEC production. In Smith 2005 found
indicator that Saudi Arabia may have played a special role within OPEC.
2.1 Swing producer
The Saudi Arabia leadership within cartel is established in order to stabilize or moderate oil
prices and achieve its political objectives (Al Yousef 2011). The Saudi Arabia is represented
in some studies as the swing producer or the balance wheel which absorb fluctuations in the
supply and demand in order to maintain the monopoly price. As is it quoted in AlYousef
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2011, the monopoly price and the stability of OPEC depends more on whether Saudi Arabia`s
share of the production of oil by cartel satisfies its objective than on the cohesion of the
cartel, according to proposed model Arabia chooses the price path in order to maximize its
wealth and taking into consideration the reactions of the other members. In order to achieve
and keep the cartel price OPEC defines its own production level, and Saudi Arabia acts as the
swing producer. Griffin and Teece 1982 stated that Saudi Arabia is the swing producer or the
balancing wheel absorbing demand and supply fluctuation in order to keep stable monopoly
price. They found that price level and level of stability in OPEC mostly depends on how
Saudi Arabia satisfies its own needs, then on the cartel behavior. It is found that OPEC is
choosing its production level to keep stable cartel price while Saudi Arabia acted as the swing
producer. Especially it is shown in period of 1975 when Saudi Arabia decreased its
production level in order to keep stable oil price at the monopolistic level. (AlYousef,2011).
In the case of OPEC ( Smith 2005) there is compensating behavior. One producer increase
own production in order to offset the decline in production of others. (Smith 2005) examines
the comparative static properties of equilibrium adjustment and he found that differences in
the frequency of compensating the changes in the output are connected with the degree of the
independence among the producers. This gives explanation in order to define which type of
behavior is applied, competitive, oligopolistic or collusive behavior.
In 1980s Saudi Arabia acts as a swing producer and Saudi Arabia adjusted its production of
oil in order to stabilize the production of OPEC and target price. In the work of Griffin et al
1994, the empirical results were designed to show that Saudi Arabia played the role of swing
producer, when the profits fell below the Cournot profit floor, the swing producer strategy
was abandoned and tit-for –tat strategy was implemented later. In the earlier ages the Saudi
Arabia in order to stabilize prices adjust output by adopting the swing producer strategy. In
period of 1983 to 1985 there was swing producer role assigned to Saudi Arabia and quotas to
other members. Swing producer role is favorable if the Saudi Arabia profits more than under
the Cournot production level. The success of this strategy depends on the willingness of other
OPEC countries to restrict their output below Cournot level and follow quota. If others
exceed the quotas, the Saudi Arabia decided to produce according to Cournot model in order
to punish them. Everyone would be better off if produces within quota and Saudi Arabia acts
as a swing producer. If others increase the production level and exceeds the quota it decrease
revenue of Saudi Arabia and transfer it to the others and creates incentives for others to cheat
and produce more. One of the explanation of the oil collapse in 1986 was the due to Saudi
Arabia decision to left the role of the swing producer.
Dahl and Yucel (1991) tested the swing producer model and that Saudi Arabia production
level does not have any relationship with the level of output of others. Saudi Arabia is acting
as a swing producer to prevent sharp price drops by cutting production rapidly in response to
declining prices.
2.2 Dominant producer
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Smith in his work in 2008 examines: the OPEC goal is to set the price. Kaufman et al (2008)
results indicate that higher prices have a positive effect on production of Saudi Arabia. In
their work Saudi Arabia did not showed the sharing behavior so it leads to conclusion that
Saudi Arabia is a dominant firm. As it is quoted in Al- Qahtani (2008) it is found that the best
model that explains the oil price in period 1974 to 1978 is dominant firm model. He believed
that Saudi Arabia dominated the residual demand and through adjusting their production level
they determine oil price on world market. Saudi Arabia has name of the dominant producer
because of its large oil reserves and excess capacity production.

Figure 1: Saudi Arabia Responses
Griffin and Teece 1982 explains OPEC as the dominant producer with Saudi Arabia that acts
as swing producer that is able to absorb the fluctuations in demand and supply. As quoted
Saudi Arabia is the swing producer or the balancing wheel absorbing demand and supply
fluctuation in order to keep stable monopoly price. They found that price level and level of
stability in OPEC mostly depends on how Saudi Arabia satisfies its own needs, then on the
cartel behavior. Saudi Arabia chose the combination which maximizes its wealth by taking
into consideration the reaction of others. Grriffin 1994 shows that Saudi Arabia production
depends on the production of others, with Saudi Arabia as the market leader which varies
production inversely to the competitive output including the rest of OPEC.
2.3 Tif – fof –Tat Strategy
Saudi Arabia adopted the strategy tit-for-tat in order to punish cheating by other members of
OPEC. Griffin and Neilson (1994) show in their work that in oil period of 1985 to 1986 the
Saudi Arabia adopted tit –for –tat strategy that benefits to all members of cartels and
established the production disciplines among them. Later Saudi Arabia was forced adopted
tit-for tat strategy to keep its market share because of the cheating by others. Results from
Dibooglu 2007 shows that there is significant influence of cheating in the OPEC on the real
price of oil. Again in period 87-90 Saudi Arabia production oscillated slightly around the
quota level and after increase in the cheating by other members Saudi Arabia in 1988 start to
aggressively increase production and to cheat in order to match the level of the cheating by
other members of cartel. This was the adoption of the tit-for-tat strategy because each
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member of OPEC, including the Saudi Arabia exceeded the assigned quotas and Saudi Arabia
kept its market share.
The strategy adopted by OPEC should be Pareto efficiency. The Saudi Arabia adopted the titfor-tat strategy as long as the others production deviate from assigned quotas, and produces
according to the Cournot best-response function for the reminder of the game if the other
exceeds given level. All members produce according to their their Cournot best response
functions. It is equilibrium in which Arabia plays tit-for-tat strategy and earns the profit. The
strategy depends on behavior of others. They found that there is strong evidence that cheating
by members of OPEC has significant influence on the real price of oil, which leads to
conclusion that quota system is not effective. During the period of its membership Saudi
Arabia was leader in the oil market. It has this role because of its position regarding
production and reserves of oil. OPEC`s success was probably due to willingness of its largest
member; Saudi Arabia, to act unilaterally to keep oil prices high. When one of the smaller
members increased its output of oil, Saudi Arabia reduced their own in compensation. This
was not altruism on Saudi Arabia part; rather, it arose from the logic of situation. The Saudi
Arabia position is example of game theory model called Dominant Pig. Here Saudi Arabia is
in the position of big pig. Both Saudi Arabia and the smaller producers knew that OPEC
would collapse unless the Saudi Arabia limited their own production; and the smaller
producers took advantage of this, getting a free ride on the Saudi Arabia efforts. Saudi Arabia
captured for itself a large enough share of the benefits of the high prices that it rationally
willing to bear a disproportionate share of the cost of maintaining the cartel. (McMillan
1992).
3. CONCLUSION
It is hard to distinguish which kind of cartel OPEC is. As in each cartel in OPEC there is also
cheating behavior by its members. OPEC must be able to detect and to punish cheaters. Each
of the members are dependent on the oil production and it is in their interest to maximize
output. OPEC is as organization as cartel, but it has almost monopoly power, because all
other oil market participants depend on the decision of the OPEC.
Saudi Arabia plays important role in OPEC. The role of the Saudi Arabia is to be medium
which balance the production of the OPEC. Saudi Arabia is producer that actually influences
the price indirectly, because if the Saudi Arabia cheats it would increase the output by whole
OPEC and it would lead to the decrease in the price. Change in behavior of Saudi Arabia
would shake equilibrium in the oil market, prices would decline etc. In order to prevent the
oil shocks it would be better if the production is split among the all members, without making
production of oil dependent on the only one producer. Position of Saudi Arabia is very
plausible for its own interest, but if the interest of Saudi Arabia clash with interest of other
members of OPEC it would bring negative consequences on the oil market, because Saudi
Arabia in order to protect itself could make decision that would make all participants worse
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off. It could lead to the increase in prices so it would hurt others, especially customers. Each
member has the incentive to cheat. When one cheat, all others want the same and it leads to
worse condition, production increased, price decline as well as there is decrease in the
revenue. Each market should have force that will keep balance and stable equilibrium, and it
is done by swing and dominant producer which is strong enough to provide support to others
and brings benefits to everyone.
REFERENCES
Aguirar-Conraria, L. and Wen,Y. (2011) OPEC` s Oil Exporting Strategy and
Macroeconomic (In)Stability Working Paper 2011-013A, Federal Reserve Bank of St. Louis
Al-Qahtani, A. “ A Model for the Global Oil Market: Optimal Oil Production Levels for
Saudi Arabia”
Al- Qahtani, A. Balisteri, E. and Dahl,C. (2008),” Literature Review on Oil Market and
OPEC1s Behavior”, Division of Economics and Business, Colorado School of Mines
Al- Yousef, N. (1998) “ Economic Models of OPEC Behaviour and the Role of Saudi
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Al-Yousef , N.(2011) “ The Dominant Role of Saudi Arabia in the Oil Market from 1997 2010”
Bagheri, A. (2011) “OPEC`s Role in Diversified Future Energy Market” Iranian Journal of
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Bandyopadhyay, K. R. (2010) “ Does OPEC Acts as Residual producer” Asian Institute of
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Barros, C. P., Gil-Alana, L.A. and Payne, J.E. (2011) “An Analysis of Oil Production by
OPEC Countries: Persistence, Breaks, and Outliners” Working Paper Series No.06/11, Centre
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The Energy Journal, Vol.17, No.2, pp.43-57
Hochman, G. and Zilberman, D. (2011) The political economy of OPEC

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Kaufman, R.K., Bradford, A., Belanger,L.H.,Mclaughlin,J.P. and Miki, Y.(2008)
“Determinats of OPEC production: Implications for OPEC behavior”, Energy Economics,
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McMillan, J.(1992) Games, Strategies and Managers, Oxford University press
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Smith, J.L (2005) “Inscrutable OPEC: Behavioral Test of Cartel Hypothesis”, The Energy
Journal, Vol.26, No.1, pp.51-82

Cooperation and competition in Information Technology Business: Case of ICT firms in
Konya
M. Atilla Aricioğlu1,Deniz Göktaş2, Birol Mercan2
1Department of Business Administration, Konya University,Konya, Turkey
2Department of Economics, Konya University, Konya, Turkey
E –mails: maaricioglu@gmail.com, d.goktas@gmail.com, birolmercan@gmail.com
Abstract
The notion of clusters has been attracted increasing interest from academics and business
practitioners for two decades. The theory and research emphasize their strong and positive
influence in promoting industrial development, innovation, and competitiveness and
economic growth. Thus clusters, become a useful policy instrument in regional innovation
systems (RIS) aiming to promote sustainable regional growth. Related literature suggests that
competitive clusters provide a fertile and conducive business environment for companies to
collaborate with research institutions, suppliers, customers and competitors located in the
same geographical area. They are becoming powerful engines of economic development and
drivers. Not all industries can create opportunities for employment, but of which share
knowledge and transfer technology both directly and through upstream and downstream
linkages with other relevant sectors. Not only they move their production facilities, they also
intend to transfer their research and development units from those favorable regions which
have relatively higher stage of development than the others in terms of infrastructure
facilities, education and training institutions, stable incentives, subsidiary potential, and the
presence of other multinational enterprises.
296

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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

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Informatisation of the Judiciary in BiH: Success Factors
Nedim Fisekovic, Meliha Handzic
International Burch University, Bosnia and Herzegovina

Abstract
Informatisation of the judicial system covers all aspects of information and communication
technology (ICT), including: equipping the courts with modern information technology
equipment (desktop computers, servers, and printers), setting up a local area network (LAN)
and wide area network (WAN), establishing a system of electronic mail for the judicial
institutions, developing a system for case management system (CMS and TCMS), developing
and establishing judicial web sites (web portal), computer education of all employees in the
courts and prosecution offices, internet access for all users in the judiciary and many more.
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In Bosnia and Herzegovina, all of the above activities have been implemented by the HJPC
(High Judicial and Prosecutorial Council)in pursuit of European standards, with donor
support. Since first contributions from USAID and ICITAP, further contributions from EU,
Norway, Spain, Netherlands and Sweden contributed to the project success by providing ICT
solutions, staff, training and continued development.
Full informatisation of the judicial system will enable the full automation of courts and
prosecutors' offices; also all employees in the courts will have direct access to relevant
information, documents and services provided by the courts and prosecutors offices and
citizens will have access to their personal court cases over the Internet.
Keywords: judicial system, informatisation, Bosnia and Herzegovina
1.INTRODUCTION
In the introductory section of the final project report (HJPC, 2011), its authors claim that high
quality and modern judicial services, capable of answering all of society’s needs, cannot be
achieved without information and communication technology (ICT). They also state that
Informatisation of Bosnia and Herzegovina's (BiH) judiciary has been a long process, but
today, the state of the art judicial information system in BiH is the most thorough and modern
of any country in the region. In the end, they conclude that the project brings immense
benefits for the delivery of justice.
The report reminds us that before the introduction of ICT reform in the judicial system, courts
and prosecutors’ offices had very few computers that operated without licensed software.
Consequently, developments in cases were logged manually and all information had to be
retrieved from mountains of paper files.
The situation became even worse as a result of the 1990s conflict, with increasing number of
complex court cases on one side, and with out-dated and inefficient practices on the other.
Such environment threatened to exacerbate the backlog problem even further. ICT was
necessary to make possible a dramatic change in the working operations of the courts.
2.INFORMATISATION PROJECT DESCRIPTION
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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

A cutting-edge and tailor-made ICT project for the BiH judiciary was launched by the
country’s High Judicial and Prosecutorial Council (HJPC). The scope of the project of
informatisation of the judiciary covers all aspects of the continuity of mass and systematic
introduction of Information and Communication Technology (ICT) in the courts and
prosecutors' offices across the country, including hardware, software, application programs,
and the use of human resources, control of relevant process changes and other related
business processes (ICJ, 2004).
The ultimate goal of informatisation of the judiciary in Bosnia and Herzegovina is "EJustice". This goal corresponds to the objectives set by the European Union in terms of
creating a technical platform that allows access to existing or future information systems at
national and international levels in all areas of the judiciary.
The main expectation from establishing an electronic judiciary is that the use of information
and communication technologies would significantly improve the efficiency of courts and
prosecutors at the state level, and the courts and prosecutors in the FBiH and the RS. Thus,
among other things, the current huge backlog accumulation would be significantly reduced,
and new items could be processed in time.
In general, the business processes in the courts are considered suitable for intensive and
effective use of ICT tools and these tools can be used to significantly enhance and improve
business processes in every respect. So far, the results of the process of informatisation of
judiciary include the following elements (HJPC, 2011):
HJPC established ICT (Information and communications technology) department
All courts in judiciary have employed ICT experts
WAN network connects 85 institutions in the area of the country
LAN networks in 85 institutions connects more than 100 servers and 5,000 workstations
Case Management System (CMS) enabled the complete automation of work processes in the
judiciary
313

Impartiality served through the assignment of cases to judges
Transparency of the registers changes and actions
More effective communication between the courts in the judiciary
Prevented loss of part of the file
Quick and easy access to information for clients and lawyers

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

-

Web Portal of Justice of BiH provides easy access to information
Online database of the Judicial Documentation Centre provides access to the legal
practice of judges, prosecutors and associates.
Internet access is provided for all users in judiciary

The most significant achievement is the introduction of case management in all courts and
prosecutors in Bosnia and Herzegovina. Judicial institutions are linked in a common wide
area network and a judicial web portal is established that contains the web pages of judicial
institutions. Citizens and their legal representatives now have access to court files online
(over the internet).
Thanks to the activities undertaken so far to establish an electronic justice the work processes
in the courts and prosecutors' offices have been promoted, and transparency of their work
increased. Applying information and communication technology has accelerated flow and
exchange of information and created technical prerequisites for the exchange of information
between judicial and prosecutorial registers on the one hand and electronic records kept by
other state and agencies on the other.
Since the good results of this project showed the justification of investment in information
communication technology strategy for justice sector reform in Bosnia and Herzegovina,
continuation of the started activities is anticipated. Informatisation of Justice is included in
the activities outlined in the Action Plan implementing the European Partnership with Bosnia
and Herzegovina.
3.PROJECT SUCCESS FACTORS
Project management literature often reports project failures, projects completed out of budget,
time or with reduced scope. For example, the controversial Standish group results and Chaos
survey from 2003 revealed that only 30% of projects were delivered on the original scope and
agreement (Hastie 2006). Therefore, the successful completion of the studied informatisation
project makes it especially interesting case for exploration.
In general, good management of projects and people working on them is considered essential
for its success (Valacich and Schneider, 2010). Most organisations appear to be well aware of
these facts and tend to pay attention to necessary roles and responsibilities in development
teams. However, planning is often performed and requirements defined that do not meet
314

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

stakeholders’ expectations. Although various causes of project success and failure have been
the subject or prior research (Haughey, 2010; Prabhakar, 2008), there has been a little attempt
to define the criteria for success, report systematic research of the factors that cause project
success or failure, or provide deep insights into these successes and failures (Frese and
Sauter, 2003).
Therefore, this study will attempt to identify the most important factors that contributed to the
success of the project of Informatisation of the judicial system in BiH. More specifically, the
study examined (i) people, (ii) process and (iii) resource related aspects of the project from
the perspective of IT professionals who participated in the project. With respect to people,
project managers’ and team members’ competencies, training and mentoring were examined.
Regarding process, various aspects of project planning, development and implementation
were explored. Finally, the study examined the financial resources and client inputs provided
to support the project.
4.RESEARCH METHOD
Descriptive survey was selected as a preferred method for the current research. This method
enabled systematic gathering of quantitative data from a sample of individuals for the
purposes of describing the attributes of the larger population of which the individuals were
members (Glock, 1967). The survey form was designed to include a total of 22 questions.
The first 4 questions were about personal information of each respondent, while the
remaining 18 questions addressed various people, process and resource related aspects of the
project.
The subjects were 70 IT personnel in positions of system administrators, database
administrators and system developers from different regions of BiH. Most were experienced
professionals. Among these, 26% were highly experienced having spent more than 5 years on
the project, 63% spent between 3-5 years on the project and only 11% were novices with less
than 3 years experience on the project.
The questionnaires were created and distributed using Google docs (https://docs.google.com).
Online questionnaires represent a convenient way of conducting surveys, as they enable
crossing of time and geographic barriers, and are cost effective. In addition, Google docs is
an excellent online tool that helps create and manage online surveys easily. In responding to
the survey, the participants rated their opinions about various project aspects on a 7-point
315

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Likert scale. Their responses were collected, encoded and analysed using MS Excel
descriptive statistics.
5.RESULTS
The results shown in Table 1 indicate that all aspects of the project were positive. This was
demonstrated by all average scores greater than 4 (out of 7). Responses were negative in that
they show that there is room for further improvement. This is demonstrated by all scores
lesser than 7 (out of 7). These score also point to major weaknesses and obstacles.
Table 1: Mean respondents’ scores of various project aspects
Project aspect

score

Testing Tools

5.03

Quality Assurance (Code inspections, design reviews, testing etc)

5.13

Training and Mentoring

5.11

Project Manager's Competence

5.44

Project Manager's authority to make decisions during the development

5.40

Team Members Competence

5.34

Team Members influence the project &amp; the flexibility to create a good design

5.27

Postmortem Analysis (Lessons learned from previous projects)

5.19

Project Scope Definition

5.17

Support from Senior Management

5.09

Planning

5.13

Communication System and Procedures

5.31

Timeliness/Relevance of Project

5.34

316

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Level of involvement the developers have in estimating timeliness/relevance

5.34

Progress Monitoring

5.27

Clarity of Project Objectives and Goals

4.93

Requirement Statements/Specifications

5.11

Development Methodology/Process

5.23

Development Tools

4.86

Focus on New/Evolving Technologies

5.09

Level of User/Client Involvement

4.69

Budget and Resources

4.61

Level of client input/involvement and financial resources were assessed as the least satisfying
project aspects. It is therefore not surprising that one of the weakest planning aspects related
to the project was "Clarity of Project Goals and Objectives". The lack of client involvement
and thus the lack of clear project goals was often mentioned in the literature as the prime
cause of failure. However, it appears that high level of project manager’s competence and
authority was crucial in overcoming such weaknesses in this project.
Indeed, a comparative analysis of people, process (planning, development, implementation)
and resource related aspects of the project clearly shows that people were the most important
factor contributing to the success of this project. Competent IT personnel managed to deliver
successful project outcomes despite the lesser than required financial and client resources and
with less than adequate supporting development tools.

317

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo
people

resources

implementation

5.40
5.20
5.00
4.80
4.60
4.40
4.20

planing

development

Figure 1. Comparative analysis of project success factors
6.CONCLUSIONS
In this study, we examined the main factors that contributed to the success of the juditiary
informatisation project in BiH. The results suggest that human factors (particularly project
manager's competency and authority) are the most important success factors, followed by
process related characteristics, followed by supporting resources. These results confirm the
proposition that knowledge is the most important capital for development in the knowledge
economy.
However, these findings need to be interpreted with caution due to a number of limitations.
The study examined success from the developers' rather than users' perspective. The
measures used demonstrated good reliability, but they are not accepted published scales. Data
was collected in BiH. The question is whether these results would hold in a different culture.
Therefore, further research is recommended that would replicate and extend the current
investigation to other contexts, systems and subjects in order to verify and generalise these
findings. Future research is also encouraged to develop new research models and variables
aimed at enriching our collective understanding of the project success factors.
REFERENCES
318

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Frese, R. and Sauter, V. (2003) Project Success and Failure: What is Success, What is
Failure, and How Can You Improve Your Odds for Success?
Glock, C.Y. (1967) Survey Research in the Social Sciences. Russell Sage Foundation, New
York.
Hastie, S. (2006) What Makes Information Systems Projects Successful?
HJPC (High Judicial and Prosecutorial Council) of Bosnia and Herzegovina (2011)
Informatisation of the judiciary in Bosnia and Herzegovina 2004-2011.
Haughey, D. (2010) The Four Levels of Project Success, Project Smart 2000-2010.
IJC (Independent Judicial Commission) – Head Office Sarajevo (2004) Development of
Information and Communication Technology in the Cours and Prosecutors’ Offices of Bosnia
and Herzegovina.
Prabhakar, G.P. (2008) What is Project Success: A Literature Review, International Journal
of Business and Management, 3-10.
Valacich, J. and Schneider, C. (2010) Information Systems Today (4th ed), Pearson
Education.

Advanced Techniques And Application Of Learning Content Management Systems In
Enterprises
Šemsudin Plojović1, Muzafer Saračević2,Enis Ujkanović3, Suad Bećirović3
1Department of Economics, International university of Novi Pazar, Serbia
2Faculty of Science and Mathematics, University of Niš, Serbia
3Department of Economics, International university of Novi Pazar, Serbia
319

�</text>
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                <text>Informatisation of the judicial system covers all aspects of information and communication  technology (ICT), including: equipping the courts with modern information technology  equipment (desktop computers, servers, and printers), setting up a local area network (LAN)  and wide area network (WAN), establishing a system of electronic mail for the judicial  institutions, developing a system for case management system (CMS and TCMS), developing  and establishing judicial web sites (web portal), computer education of all employees in the  courts and prosecution offices, internet access for all users in the judiciary and many more.In Bosnia and Herzegovina, all of the above activities have been implemented by the HJPC  (High Judicial and Prosecutorial Council)in pursuit of European standards, with donor  support. Since first contributions from USAID and ICITAP, further contributions from EU,  Norway, Spain, Netherlands and Sweden contributed to the project success by providing ICT  solutions, staff, training and continued development.  Full informatisation of the judicial system will enable the full automation of courts and  prosecutors' offices; also all employees in the courts will have direct access to relevant  information, documents and services provided by the courts and prosecutors offices and  citizens will have access to their personal court cases over the Internet.  Keywords: judicial system, informatisation, Bosnia and Herzegovina</text>
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Stewardship,

Traffic Accident Detection By Using Machine Learning Methods
Nejdet Dogru, Abdulhamit Subasi
International Burch University,Sarajevo, Bosnia And Herzegovina
E –mails: ndogru@ibu.edu.ba, asubasi@ibu.edu.ba
Abstract
There are lots of studies about preventing or detecting the car accidents. Most of them
includes sensing objects which might cause accident or statistics about accidents. In this
study, a system which detects happening accidents will be studied. The system will collect
necessary information from neighbor vehicles and process that information using machine
learning tools to detect possible accidents. Machine learning algorithms have shown success
on distinguishing abnormal behaviors than normal behaviors. This study aims to analyze
traffic behavior and consider vehicles which move different than current traffic behavior as a
possible accident. Results showed that clustering algorithms can successfully detect
accidents.
1.INTRODUCTION
Recent inter vehicular studies are acquiring commercial interest via the DSRC/WAVE
standard in Vehicular Ad Hoc Networks (VANETs). Possible future services among vehicles
are topic of many studies(Xu et al., 2004; Nandan et al., 2005; Lee and Gerla, 2010)
In VANETs, vehicles are able to communicate with each other in vehicle-to-vehicle (V2V) or
with roadside network infrastructure in vehicle-to-Roadside Communication (V2R) manner.
Some of the envisioned applications for vehicular networks are : vehicle collision warning,
security distance warning, driver assistance, cooperative driving, cooperative cruise
control,dissemination of road information, internet access, map location, automatic parking,
driverless vehicles(Boukerche et al., 2008)
Most of applications need traffic speed and travel time measurements. These measurements
can be used to help roadway users to decide which route to use or when to depart etc. Also
These measurement can be saved to analyze traffic speed and travel time patterns for
different time intervals. Currently local detectors at specific points along the road are used to
468

�measure the speed. New approach is to equip vehicles with communication and location
devices to measure their speed and travel time. Some studies have shown that cellular
networks can be used to identify vehicle’s location using cellular phone base station
communication records(Bar-Gera, 2007)
Safe navigation support has also become one of the main research topic with the help of
DSRC/WAVE standardization(Jiang et al., 2006). For instance, collision or road condition
warning messages can be forwarded to following vehicles. Beside DSRC/WAVE standards,
2/3G cellular networks can be used to enable message exchange among vehicles(Boukerche
et al., 2008; Lee and Gerla, 2010)
In this study, we will use machine learning methods to analyze collected information from
vehicles to detect forward collisions. Drivers will be alerted about collision and they will
have time to take precaution to avoid piled-up collision.
2.BACKGROUND
Recently, automatic incident detection has attracted much attention in freeway control
systems to reduce traffic delay, advance road safety, capacity and real time traffic control
because when freeway and arterial incidents occur, they cause congestion and mobility loss,
if they are not fixed immediately, they can cause second traffic accidents. Algorithms which
is used to detect incidents include the pattern recognition techniques , time
series(Angshuman, 2004), filtering, fuzzy set(Edmond Chin-Ping Chang and Kunhuang
Huarng, 1993), and artificial neural network(Edmond Chin-Ping Chang, 1992) (Wang et al.,
2007)
Unlike sensors, vehicles can be equipped with sensing devices with high processing power,
high cost and weight like GPS, chemical spill detectors, video cameras, vibration sensors,
acoustic detectors, etc.. since they are not usually restricted by energy and size constraints.
VANETs deployment scenario is different than traditional wireless sensor network
deployment scenarios since vehicles expose limited mobility pattern due to street shapes,
intersections, speed limitation, vehicle size. If vehicles are equipped with network cards, they
can access wireless access networks like DSRC/WAVE, Cellular, Wifi, WiMAX, etc(Lee
and Gerla, 2010)
2.1.Traffic Flow/ Incident Detection
Advances in ITS require more accurate traffic information and providing this information
became a big challenge for the public institutions and private companies. The traditional
traffic sensors that are used to measure current traffic conditions, like loop detectors, are
ineffective to provide accurate information about traffic status on a road network.
469

�Traffic related information from other sources , such as cameras, GPS, cell phone tracking,
probe vehicles, are used to improve accuracy of the traditional measurement systems.
Traffic manegement control centers also keep these traffic related information for future use.
Data fusion techniques can be used to combine offline traffic data and data from multiple
sources in order to produce better understanding about road traffic state and future necessary
road development(Faouzi et al., 2011)
Data fusion techniques that are used in traffic management include Dempster–Shafer
inference, Bayesian inference, and voting logic. Most of these techniques combined probe
vehicle data with traditional traffic data for incident detection. Neural network approach was
also used to detect incidents from observed information(Faouzi et al., 2011)
2.2. Localization
Most of VANET application needs vehicles’ current position. In order to compute the
position of vehicles, Global Positioning System, Map Matching, Dead Reckoning, Cellular
Localization, Image/Video Processing and Relative Distributed Ad Hoc Localization
techniques has been studied. All of these techniques have advantages and disadvantages.
GPS signals may not be available in dense urban environments, tunnels, indoor parking lots,
forests or underground environment or might be effected or blocked by obstacles, electronic
interference. Also accuracy of GPS position can change from ±10 to 30 m. This accuracy
array will occur at all nearby receivers. Map knowledge can be used to decrease the error at
the position of vehicle that calculated by other techniques. Vehicles are supposed to follow
roads, vehicle position can be match with road coordinates to estimate the location of
vehicle(Krakiwsky et al., 1988; Jagadeesh et al., 2004)Dead reckoning technique compute
vehicle location using its last known location based on direction, speed, time, etc when GPS
signal is not available. Map knowledge can be combined to improve accuracy(Krakiwsky et
al., 1988; King et al., 2005)Cellular localization techniques use cellular networks to estimate
the position of the mobile phones(Han-Lee Song, 1994; Caffery and Stuber, 1998)Cellular
localization is less accurate than GPS, localization error might change from 90m to
250m(Chen et al., 2006). Cellular localization results are not accurate enough for VANET
applications but it can be useful when combined with other techniques. Local relative
position maps are dynamic position maps which shows vehicles’ relative position from other
vehicles. Every vehicle estimates its distance from other vehicle and shares this information
with nearby vehicles to construct local relative position map(Kukshya et al., n.d.; Boukerche
et al., 2008)

470

�3.METHODOLOGY
Machine learning methods showed great success at anomaly detection. In this study, we
considered incidents in normal traffic flow as an anomaly. When accident happens, following
cars will slow down or stop, and many cars will be affected from accident. When location
data of vehicles are analyzed , it is seen that many cars are collected around accident location.
Clustering algorithms can be used to group vehicles according to their speed and location in
particular road segment. In accident case, algorithms will put vehicles which is affected by
accident in one group , other vehicles in other group or groups.
In our simulations , it has been observed that number of group is increased by 1 at the time of
accident and number of vehicles in the new group increased in the following seconds. It can
be interpreted as an accident happened and following cars or cars around the accident are
affected by the accident.
4.RESULTS AND DISCUSSION
In this study, Simulation of Urban Mobility, SUMO traffic simulator has been used to enable
mobility of vehicles and collect position and sleep information. 100 vehicles has been used in
3000 m road segment. 5 different vehicle types has been used to imitate real life traffic.
Type

Length (m)

Acceleration Deceleration Max Speed
(m/s2)
(m/s2)
(m/s)

Driving
Perfectness

A

2

8

10

30

50%

B

4

2

10

30

50%

C

6

5

10

30

50%

D

8

4

10

30

50%

E

10

14

10

30

50%

Table 1 : Vehicle types and properties
SUMO traffic simulator is collision free traffic simulator. To simulate accident, cars are
forced to make a stop in predefined position. Stops also can be considered important incident
in a road segment. Vehicle itself or passengers who are leaving the vehicle might cause a
problem. Identifying such incident and alerting coming vehicles will avoid possible
accidents.
One car is forced to make a stop at 50 th second of the simulation. Deceleration value is
chosen as 30 m/s2 to make stop instantaneously. DBSCAN (Sander et al., 1998) unsupervised
471

�clustering algorithm is used to create clusters. Every second, vehicle positions has been
received from SUMO traffic simulator and fed to WEKA machine learning tool (Holmes et
al., n.d.) Results of clustering structure as follows before and after the accident:
Simulation Time Number of Cars Normal Cluster
in Road Segment

Anomaly Cluster

47

67

67

48

68

68

49

68

68

50

68

67

1

51

71

68

3

52

71

68

3

53

74

70

4

54

76

72

4

55

76

72

4

56

77

73

4

Table 2: DBSCAN clustering results
When the car made a pre-scheduled stop at 50 th second of simulation, DBSCAN has been
able to detect anomaly situation. Number of anomaly cluster increases after accident as
expected because car stop or accident has blocked the road.
5.CONCLUSION
Automatic accident detection became very important topic in traffic management systems.
Detection of accident will avoid future accidents and will help authorities to make road
segment available for traffic again. In this study, we showed that traffic behavior can be
analyzed using vehicle positions and speeds and abnormal activities on the road could be
considered possible danger for the drivers who are close to incident area.

472

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Edmond Chin-Ping Chang, 1992. A Neural Network Approach to Freeway Incident
Detection. IEEE, pp. 641-647.
Edmond Chin-Ping Chang, Kunhuang Huarng, 1993. Fuzzy Set Applications For Freeway
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ACM Press, p. 19.

Sustainability and Using Information Technologies in Disaster Managament
FatmaNevalGenç, Murat Yılmaz
Adnan Menderes University, Faculty of Economic and Administritive Sciences,
09900, Nazilli, Aydın, Turkey.
E-mails: fatmanevalgenc@gmail.com,muratyilmaz@adu.edu.tr
Abstract
Sustainable development is a concept that meets the needs of present without
compromising the ability of future generations to meet their own needs. In recent years world
population suffered by numerous natural and manmade disasters so that they strived to
474

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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo

Biodiversity for sustinable agriculture: Common bean genetic diversity
Nemli Seda , Tanyolac M.Bahattin
Department of Bioengineering, Ege University Izmir, Turkey
E-mail: eryilmazseda@hotmail.com
Abstract
The immense genetic diversity of genotypes of crops is the most directly useful
and economically valuable part of biodiversity. Genetic diversity is a key factor
enabling adaptation, and therefore survival, of natural populations in changing
environments. And also genetic diversity is essential tool for any breeding
program. Leguminous plants, after cereals, include the most economically
important species of agricultural interest, considering area cultivated and total
production. Among the grain legumes,soybean, peanuts and common beans are
the most important commercial crops. Common bean (Phaseolus vulgaris L.) and
its related species are important protein sources for the world population. In 2006,
the bean industry was valued at $1.2 billion and $180 million in USA and Canada,
respectively. The average yield of bean varieties cropped in developing countries
is still very low. The analysis of genetic diversity and relationships among
different individuals, species, or populations is an important topic in genetics and
plant breeding. Since morphological charactersin plants effect from environmental
condition, DNA markers provide the most precise tool for measuring genetic
relationships, because they are potentially unlimited in number Among the DNA
techniques, Amplified Fragment Length Polymorphism (AFLP) is intense and
provides a powerful tool for genotype identification, phylogeny The AFLP
technique is based on the amplification of short restriction endonuclease digested
genomic DNA fragments onto which adaptors have been ligated at both ends.For
this purpose common bean genomes were analyzed using AFLP fingerprinting to
examine the genetic variation within and among genotypes.. A total of 86
common bean accessions collected from different countries were used in this
study. For the AFLP analysis,12 primer combination were used. Acrylamide gels
from primer combination were scored according to presence (1) or absence (0) of
amplified fragments.The molecular data were analyzed using the NTSYs
program. A dendrogram was generated using JMP software (version 3.1, SAS
Institute, 1995) based on the UPGMA (unweighted pair-group method of
arithmetic average). The eightysix genotypes represented seven different clusters
as revealed by AFLP primers. The minimum variation was detected between
sample 20, Turkey and sample 24, Turkey (GD = 0.09), and the maximum was
found between samples 34 and 28 (GD = 0.80).
Keywords: Biodiversity, Common bean, AFLP

22

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo

1.INTRODUCTION
Common bean (Phaseolus vulgaris) is an important economic food legume and is
widely grown in North, Middle and South America, Eastern Africa, Europe and
China. The bean seed is rich in protein, fiber, carbohydrates, minerals and
vitamins. Beans provide a good source of protein for rural and urban poor in many
developing countries. (Pachico,1989) Common bean originated and was
domesticated in the New World and has two major gene pools, The Andean and
The Mesoamerican, based on their centers of origin in South and Central America,
respectively. (gebts and debouck 1991). Common bean is a diploid (2n=22)
legume with a relatively small genome. A few species show an aneuploid
reduction to 20 chromosomes. The genome of common bean is one of the smallest
in the legume family at 625 Mbp per haploid genome.
DNA markers provide the most precise tool for measuring genetic relationships,
because they are potentially unlimited in number and are not affected by the
environment (Maciel et al., 2003). During the last two decades, DNA-based
molecular markers have been extensively used for a variety of purposes in many
animal and plant systems. Among the DNA techniques, amplified fragment length
polymorphism (AFLP) is robust and provides a powerful tool for studies of
genetic variation, genotype identification, phylogeny (Kafkas 2006), and
molecular linkage mapping (Hurtado and Ramstedt 2002). The AFLP analysis
provides a higher level of polymorphism than random amplified polymorphism
DNA (RAPD) or restriction fragment length polymorphism (RFLP) (Pejic et al.,
1998).Amplified fragment length polymorphisms are based on selective and
semiquantitative PCR amplification of restriction fragments digested from total
genomic DNA. Fragments generated by digestion of DNA with a combination of
two restriction endonucleases are linked to suitable adapters and, thereafter, linked
DNA fragments are amplified selectively with different primer combinations (Vos
et al., 1995). The RFLPs (Becerra-Vela´ squez and Gepts, 1994; Duarte et al.,
1999; Metais et al., 2000; Maciel et al., 2001), RAPDs (Haley et al., 1994;
Nienhuis et al., 1995; Moura-Duarte et al., 1999; Beebe et al. 2000; Metais et al.,
2000), inter simple sequence repeats (ISSRs) (Rosales-Serna et al., 2003), and
more recently, AFLPs (Tohme et al., 1996; Caicedo et al., 1999; Maciel et al.,
2003; Pallottiniet al., 2004) have been successfully used for the description of
diversity in common bean.
In the present paper, AFLP analysis was used to investigate genetic variability at
the DNA level in 86 common bean collected from different countries.
2.MATERIAL-METOD
A total of 86 common bean accessions were used in this study (Table 1),
including 45 Turkey accessions, 5 Netherlands accessions, 4 Germany
accessions,, 3 China accessions, 17 England accessions,11 USA accessions, 1
Bulgaria accessions.
Table 1: A list of 86 P. vulgaris accessions used in AFLP analysis

23

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo

Genotip Number

Genotip Number

Location

1

Turkey

20

Turkey

2

Netherlands

21

Turkey

3

Germany

22

Turkey

4

Germany

23

Turkey

5

Germany

24

Turkey

6

Turkey

25

Turkey

7

Netherlands

26

Turkey

8

Netherlands

27

Turkey

9

Netherlands

28

USA

10

Turkey

29

USA

11

Turkey

30

USA

12

Turkey

31

England

13

China

32

England

14

China

33

England

15

Turkey

34

England

16

Turkey

35

England

17

Turkey

36

England

18

Turkey

37

England

19

Turkey

38

England

39

England

63

Turkey

40

England

64

Turkey

41

England

65

USA

42

Turkey

66

England

43

Turkey

67

Turkey

44

Turkey

68

Turkey

45

Turkey

69

Turkey

46

Turkey

70

Turkey

47

Turkey

71

Turkey

48

Turkey

72

Turkey

49

Netherlands

73

India

50

USA

74

USA

51

USA

75

England

52

USA

76

England

53

Turkey

77

England

54

Turkey

78

England

24

Location

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo
55

Turkey

79

England

56

Turkey

80

Turkey

57

Bulgaria

81

Turkey

58

Turkey

82

USA

59

Turkey

83

USA

60

China

84

USA

61

Turkey

85

Turkey

62

Turkey

86

Turkey

2.1. DNA extraction
Young leaves from plants collected were harvested and placed in an aluminum
foil and kept in liquid nitrogen. Leaf tissue from each individual was ground to a
fine powder in liquid nitrogen with a mortar and pestle. Total genomic DNA was
extracted following the procedure as described by Doyle &amp; Doyle. The purified
DNA was quantified with ND-1000 (Nanodrop, Thermo Co.) spectrophotometer.
The DNA quality was also assessed and the concentration determined by
visualization under UV light, on 1% agarose gels in TAE (Tris-acetic acid-EDTA)
buffer and then agarose gel–stained.
2.2. AFLP analysis
Li-Cor AFLP Kit (catalog number: 830-06195 AFLP 2-DYE Selective
Amplification Kit) was used according to the manufacturer’s recommendations.
According to the kit, 200 ng pure DNA was digested with EcoR I and Mse I
restriction enzymes. The enzyme adaptors were ligate to the digested DNA.
Selective amplification of restriction fragments was conducted using primers with
three selective nucleotide extensions, RD700/800 dyes. Twenty-two primer
combinations were used to screen for polymorphism among samples.
Amplification products were resolved on 8% acrylamide gel in 1 9 TBE (Trisborate-EDTA) buffer under 1500 V and 40 mA conditions. Li-Cor 4300s DNA
Analyzer machine was used to image, analyze, and screen the bands profile
2.3. Band scoring and data analysis
Each polymorphic AFLP bands were scored manually as present(1) or absent (0)
across all 33 genotypes for each primer-paircombination and the values were used
to compile binary datamatrix.Onlybright, clearly distinguishable bands were
usedin the genetic analysis. Genetic disimilarity estimates were calculated using
Jaccard’scoefficient of disimilarity (Jaccard, 1908). JMP software (version 3.1,
SAS Institute, 1995) was used to calculate distances and a dendrogram was
generated. The accessions were grouped by cluster analysis using the unweighted
pair-group method (UPGMA).PIC (polymorphism information content) was
calculated from the 1/0 datum matrix. The PIC value refers to the relative value of
each marker with respect to the amount of polymorphism it exhibits. PIC was also
calculated by 1- Σpi2: , where i= indiviual p and pi = the allele frequencies of the
loci. (De Riek,2001).
25

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo

3.Results and Discussion
3.1.AFLP Marker analysis
The size of bands scored in all the 44 accessions were in the range of 50–450 bp.
86 genotypes were analyzed by AFLP-PCR using 13 selective primer
combinations as listed in Table 2. A total of 245 polymorphic bands were
generated, and the number of polymorphic bands per each primer combination
ranged from 4 (MCAG-EAGG) to 32 (MCAC-EACA) with an average number of
18.8 bands. A representative gel obtained from the primer combination MCAA/E-ACG ( 700 ) is presented in Fig. 1. Polymorphic bands from 86 DNA
samples, amplified by 13 AFLP primer combinations, are also listed in Table 2 .
The maximum number of polymorphic bands obtained per primer confirmed the
high polymorphism determination efficiency of AFLPs in comparison with other
marker systems used for common bean such as RAPD (Haley et al., 1994; Maciel
et al., 2001; Tiwari et al., 2005 ) and RFLP ( Sonnante et al., 1994; Stockton and
Gepts, 2004 ).
Table 2 Polymorphic bands from 86 DNA samples, amplified by 13 AFLP primer
combinations
Primer Number

Primer Pairs

1

MCAC-EACA

No. of
bands
32

2

MCAA-EAAC

25

3

MCAA-EACA

15

4

MCTC-EAAG

15

5

MCAG-EACA

27

6

MCAT-EACA

14

7

MCTG-EACA

25

8

MCAC-EAGC

23

9

MCAA-EACG

12

10

MCAA-EAGC

15

11

MCTC-EACT

20

12

MCAG-EAGG

4

13

MCAT-EAGG

18

TOTAL

245

polymorphic

3.2. Genetic diversity analysis
To determine the genetic relationships among the 86 genotypes, the scoring data
(1 for presence and 0 for absence) resulting from the 13 primer combinations were
used to compute the dissimilarity matrix according to Jaccard (1908). This
dissimilarity matrix was used to generate a dendrogram using the UPGMA
method. The 86 genotypes represented seven clades as revealed by AFLP primers
26

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo

(Fig.2). Group I was the largest one containing 44 accessions that included twenty
five Turkey varieties and seven England land races.
As shown in Table 3, the minimum variation was detected between sample 20
Turkey, and sample 24 Turkey (GD= 0,0094) and the maximum was found
between sample 34 England and samples 28 USA (GD = 0,80).

27

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo

Fig.1. AFLP pattern of 1-48 common bean DNA samples.
28

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo

Fig.1. AFLP pattern of 49-86 common bean DNA samples
29

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo

Fig. 2 Dendrogram resulting from UPGMA cluster analysis of 86 common bean
genotypes based on data derived from 13 AFLP primer combinations
Studies of genetic diversity using molecular marker and DNA sequencing
techniques are necessary if we are to understand a population’s genetic structure
and phylogeography, identify the center of genetic diversity of a species, and
develop effective conservation strategies (Gao, 2003).PCR-based molecular
marker techniques play an important role in the analysis of genetic diversity and
relatedness for crop plants, where most of the species involved are almost
30

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012,
Sarajevo

unknown at the genetic level (Ilgin et al. 2009). In this study, the AFLP method
generated large numbers of polymorphic bands. We detected a total of 284
polymorphic bands, and the number of polymorphic bands for each primer
combination ranged from from 4 (MCAG-EAGG) to 32 (MCAC-EACA) with an
average number of 18.8 bands. Our study shows that AFLP provided a large
number of polymorphic bands and a large amount of genotypic information. Grilli
Caiola et al. (2004) found the number of polymorphic bands per primer to be 2.01
in their RAPD study.
In conclusion, we have shown that AFLP profiling techniques may provide useful
information on the level of polymorphism and diversity in common bean, showing
their utility in the characterization of germplasm accessions. AFLP marker
systems have comparable accuracy in grouping genotypes of this species
according
to
their
gene
pool
of
origin

31

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

32

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Table
33

3

Genetic

distance

matrix

computed

according

to

Jaccard

(1908)’s

coefficient

based

on

AFLP

data

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

REFERENCES
Becerra-Vela´ squez, V.L., and P. Gepts. 1994. RFLP diversity in common bean. Genome
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of South Brazil. Euphytica 120, 257–263
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Moura-Duarte, J., J. Bosco dos Santos, and L. Cunha Melo. 1999. Genetic divergence among
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Mayek-Perez N., 2005, Genetic relationships and diversity revealed by AFLP markers
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Tiwari, M., Singh, N., Rathore, M., Kumar, N., 2005. RAPD markers in the analysis of
genetic diversity among common bean germplasm from Central Himalaya. Genet. Res. Crop
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Tohme, J., Gonza ´ lez, O.D., Beebe, S., Duque, C., 1996. AFLP analysis of gene pools of a
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Vos P., Hogers R., Bleeker M., Relijans M., Lee T., Hornes M., Frijers A., Pot J.,Peleman J.,
Kuiper M., Zabeau M., 1995, AFLP: A new technique for DNA fingerprinting, Nucleic
Acids Research 23: 4407 – 4414.

35

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                <text>The immense genetic diversity of genotypes of crops is the most directly useful  and economically valuable part of biodiversity. Genetic diversity is a key factor  enabling adaptation, and therefore survival, of natural populations in changing  environments. And also genetic diversity is essential tool for any breeding  program. Leguminous plants, after cereals, include the most economically  important species of agricultural interest, considering area cultivated and total  production. Among the grain legumes,soybean, peanuts and common beans are  the most important commercial crops. Common bean (Phaseolus vulgaris L.) and  its related species are important protein sources for the world population. In 2006,  the bean industry was valued at $1.2 billion and $180 million in USA and Canada,  respectively. The average yield of bean varieties cropped in developing countries  is still very low. The analysis of genetic diversity and relationships among  different individuals, species, or populations is an important topic in genetics and  plant breeding. Since morphological charactersin plants effect from environmental  condition, DNA markers provide the most precise tool for measuring genetic  relationships, because they are potentially unlimited in number Among the DNA  techniques, Amplified Fragment Length Polymorphism (AFLP) is intense and  provides a powerful tool for genotype identification, phylogeny The AFLP  technique is based on the amplification of short restriction endonuclease digested  genomic DNA fragments onto which adaptors have been ligated at both ends.For  this purpose common bean genomes were analyzed using AFLP fingerprinting to  examine the genetic variation within and among genotypes.. A total of 86  common bean accessions collected from different countries were used in this  study. For the AFLP analysis,12 primer combination were used. Acrylamide gels  from primer combination were scored according to presence (1) or absence (0) of  amplified fragments.The molecular data were analyzed using the NTSYs  program. A dendrogram was generated using JMP software (version 3.1, SAS  Institute, 1995) based on the UPGMA (unweighted pair-group method of  arithmetic average). The eightysix genotypes represented seven different clusters  as revealed by AFLP primers. The minimum variation was detected between  sample 20, Turkey and sample 24, Turkey (GD = 0.09), and the maximum was  found between samples 34 and 28 (GD = 0.80).  Keywords: Biodiversity, Common bean, AFLP</text>
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                    <text>Sustainable Development Field Mapping: A Case of ISSD 2012
Nermina Durmic, Zeynep Kara, Meliha Handzic
International Burch University, Bosnia and Herzegovina
Abstract
The purpose of this study was to analyse the nature of research preoccupying participants in
the Third International Symposium on Sustainable Development (ISSD 2012) in Sarajevo,
Bosnia and Herzegovina, from 31May - 1June 2012. It involved the analysis of abstracts and
papers submitted for presentation and publication at ISSD 2012. Each submission was coded
and entered into the Excel spreadsheet for quantitative and qualitative analyses. The results
reveal dominant research groups, as well as the type of work that has the highest relevance to
research and practice. These findings may serve as signposts for future research directions in
the field.
Keywords: sustainable development, knowledge mapping, ISSD2012, literature review,
protocol analysis
1. INTRODUCTION
Knowledge networks and/or communities of practice are considered crucial for economic
development and the achievement of local and global development goals. They are
increasingly emerging as a new form of work which includes different actors and have the
potential for knowledge creation and development performance.
According to Wenger, a pioneer and leading thinker in the field of organizational community,
Communities of Practice (CoPs) are groups of people who share a concern, a set of problems,
or a passion about a topic, and who deepen their knowledge and expertise in this area by
interacting on an ongoing basis (Cox, 2005). More specifically, communities of practice are
formed by individuals with different personal characteristics and capabilities, but with shared
interest, who interact regularly through narration, collaboration and enculturation, applying
common practices, using the same tools and expressing themselves in a common language in
order to share ideas, strategies and experiences, learn from each other, determine solutions
and build innovations to provide value to themselves and their organizations. Furthermore,
additional advantage and aim of CoPs is to develop of a social capital and bring the
socialisation and practice together.
The term „Communities of Practice“ is relatively new, but Communities of Practice are not.
They started existing ever since people in organizations realized that sharing their knowledge
with others is beneficial for solving problems and support to decision making (Nickols, 2003).
The first Community of Practice was formed on a voluntary basis by the technicians in Xerox
595

�Corporation with the aim of figuring out a way to diagnose and repair Xerox customers' copy
machines. The results were invaluable for the company's business value and customers'
satisfaction (Nickols, 2003). This is where the idea of this kind of communities came from,
later followed by four works essential for the official formation of the idea and definition of a
Communities of Practice:
First, Lave and Wenger (1991) proposed a new approach to understanding of learning as an
interaction among practitioners, instead of traditional process in which a producer provides
knowledge to a consumer (Kahan, 2004). They suggested observation and peripheral
participation as the best practices of learning. At the same time, Brown and Duguid (1991)
agreed with Lave and Wenger's statements at basic level, but they focused more on
knowledge acquisition through narrative and improvisation by experts in community instead
of reproduction of an existing practice. Then, Wenger (1998) finally defined a Community of
Practice as a group that coheres through „mutual engagement“ on an appropriated enterprise,
and creating a common repertoire (Cox, 2005). He also recognized the community members'
identity as the key factor for the existence and success of the associations that stand for the
Communities of Practice (Nickols, 2003). Wenger, McDermott and Synder (2002) redefined
the Wenger's initial concept of Communities of Practice from 1998, focusing on the value of
the Community of Practice as a management tool used for socialization, innovation and
increasing a problem solving potential in large corporations, and defining the Communities of
Practice as groups of people who are ineterested in the same thing, but with many diversities,
that interact to share knowledge and insights, instead of to get the job done (Cox, 2005). This
approach is widely accepted today.
Although the concept of Communities of Practice has been applied to business, organizational
design, government, education, professional associations, development projects and civic life,
most of the studies concentrate on their appliance specifically in organizations (Lave and
Wenger, 1998). Mainly, CoPs originate and act primarily on self-organizing basis, without
organization's management support. But very soon after they start adding value to
organization's business by developing professional skills, helping organization recruit and
retain talent, transfering best practices, solving problems very quickly and starting new lines
of business, the management decides to make them more beneficial for the organization and
supports them in every possible way, making them become sponsored CoPs in that way
(Wenger and Snyder, 2000).
However, not every organizational group is a Community of Practice. While formal work
groups, project teams and informal networks are formed necessarily by the management in
order to deliver given task in specified period of time, the purpose of Communities of Practice
is to develop members' capabilities and build knowledge and they last as long as there is
interest in maintaining the group. They belong only to members who select themselves and
passion, commitment and identification with the group's expertise are what hold them
together (Odom and Starns, 2003).
The CoP's short-term value is seen outside of it, in actions of solving problems at the places
the CoP's members act. In long-term, the value is twofold: over time the CoP's capacity and
quality increases creating whole repository of knowledge and problems solved, furthermore, it
596

�makes very positive effect to the development of social capital and socialisation, which is
assumed to enable tacit knowledge, values and beliefs to be transferred between individuals
through shared experience, space and time (Handzic, 2007).
The purpose of this paper is to examine the Third International Symposium on Sustainable
Development (ISSD 2012) in Sarajevo as a case an evolving knowledge network/community
of practice in the Balkan region.
2.Research Methodology
The character of ISSD 2012 was examined by the analysis of 343 papers/posters submitted by
683 authors. The first phase of the research required going through abstracts of all papers
submitted and the extraction of participants, participants' countries, paper topics and
keywords into Excel spreadsheets for analysis. After the duplicate records - in terms of
participants and countries, were removed, the data were grouped into several categories in
order to create corresponding charts and make conclusions. The keyword analysis tool was
used for detection the most frequent keyword in abstracts.
3.Main Findings
The participants analysis found a total of 683 authors from four different continents. Since the
symposium was held in the European country - Bosnia and Herzegovina, it was expected that
the majority of the participants would come from Europe. However, the symposium
accomplished a big success having participants from USA, Africa and Australia too, in the
rates shown in Figure 1.

Figure 1. Demographic Analysis Results per Continents
Further analysis of the European attendance showed the main interest in the sustainable
development research coming from eight European countries (with Turkey leading the group).
The results presented in Figure 2 reveal a surprisingly intense response from foreign
countries, that has even surpassed the host country.

597

�Figure 2. Demographic Analysis Results per European Countries
With respect to collaboration analysis, the results in Figure 3 indicate that participants
preferred working in groups, mostly in groups of two (45%) and three (23%) people.
Interestingly, one paper was co-authored by seven and one by nine people. This indicates that
researchers recognize that team work and knowledge sharing is the fastest path to the quality
and desired achievements. Given that one of the most important purposes of knowledge
networks and communities of practice is collaboration and knowledge sharing, this is an
encouraging finding.

Figure 3. Collaboration Analysis Results
The results of track analysis, exploring themes and topics of most interest to the participants
indicate similar spread of contributions across six different tracks. This is indicative of rich
and diverse research culture. Detailed results are shown in Figure 4.

598

�Fi
gure 4.Track Analysis Results
The final keyword analysis, focused on the keywords provided within each of the abstracts
submitted. The results presented in Figure 5 show only those words that were mentioned more
than 10 times in keywording of each paper. Apart from 'sustainable development' and
'sustanability', most frequently mentioned keywords include 'management', 'economics'
'tourism' and 'Turkey'. The remaining keywords are spread evenly and reflect different
conference tracks.

Figure 5. Keywords Analysis
4.CONCLUSIONS
599

�The main objective of this study was to analyse the nature of research presented at ISSD2012.
With respect to participants, the study showed clear dominance of foreign (particularly
Turkish) researchers over those coming from Bosnia, thus emphasising the international
character of the event. Most papers were co-authored by two or more individuals coming from
one or more different institutions, suggesting strong collaborative nature of research. All
conference tracks attracted sufficient interest, indicating high thematic and topical diversity.
While the finding of collaborative and diverse work is encouraging, the uneven geographic
representation is of some concern. It suggests the need for paying more attention on
promoting the event at local and regional levels, particularly among neighbouring countries.
REFERENCES
Handzic, M. (2007) Communities of Practice: Enhancing Collective Effectivness. SocioTechnical Knowledge Management: Studies and Initiatives, 193-207
Odom, C.J., Starns, J.F. (2003) Leveraging Communities of Practice. Knowledge
Management World, Volume 12, Issue 3
Lesser, E.L., Storck, J. (2001) Communities of Practice and Organizational Performance.
IBM Systems Journal, Vol 40, No 4,831-841
Cox, A.M. (2005) What are Communities of Practice? A Comparative Review of Four
Seminal Works. Journal of Information Science, Vol 31, No 6, 527-540
Hasan, H., Crawford, K. (2003) Distributed Communities of Learning and Practice. Handžić,
M., Hasan, H. Australian Studies in Knowledge Management, Chapter 5, 136-155
Nickols, F. (2003) Communities of Practice: An Overview
Kahan, S. (2004) Engagement, Identity and Innovation: Etienne Wenger on Communities of
Practice. Journal of Association Leadership, 27-37
Lesser, E., Prusak, L. (1999) Communities of Practice, Social Capital and Organizational
Knowledge. Information Systems Review 1., Vol 1, No 1, 3-10
Lave, J., Wenger, E. (1998) Communitites of Practice: Learning, Meaning and Identity,
Cambridge University Press
Wenger, E.C., Snyder, W.M. (2000) Communities of Practice: The Organizational Frontier.
Harward Business Review, 139-145
600

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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Örücü, E., Türk, Z. &amp; Süngü, A. (2003). Kit’lerde Performans Değerleme Çalışmalarına
Astların Destek ve Güveni: Muğla–Yatağan Termik Santrali Örneği. Yönetim ve Ekonomi
Dergisi, 10(2): 51–62.
Özgüven, B.M. (1989). Toplum Bilimlerine Giriş, Ata Ofset Matbaacılık, Ankara.
Özgüven, I.E. (2003). Endüstri Psikolojisi, Sistem Ofset, Ankara.
Randolph, W.A. &amp; Posner, B.Z. (1981). Explaining Role Conflict and Role Ambiguity via
Individual and Interpersonal Variables in Different Job Categories. Personnel Psychology, 34
(1): 89–102.
Rusbult, C. E. &amp; Farrel, D. (1983). A Longitudinal Test of the Investment Model: The Impact
on Job Satisfaction, Job Commitment and Turnover of Variations in Rewards, Costs,
Alternatives and investments. Journal of Applied Psychology, 68(3), 429–438.
Stanley, D. (2006). Role Conflict: Leaders and Managers. Nursing Management, 13(5): 31–
37.
Şimşek, M. Ş. &amp; Aslan, Ş. (2007). Mesleki ve Örgütsel Bağlılığın, İşin Özellikleri, Rol Stresi,
Örgüte İlişkin Davranışsal Sonuçlar, İş ve Yaşam Doyumuyla İlişkilerinin Araştırılması. 15.
Ulusal Yönetim ve Organizasyon Kongresi, Sakarya: 724–733.

Sustainable women policies in local administrations
Isparta practice

Nesrin Şalvarci Türeli,Nedret Çağlar
Süleyman Demirel University, Isparta Turkey
E-mails: nesrintureli@sdu.edu.tr,nedretcaglar@sdu.edu.tr

Abstract
Nowadays, feminine policies have begun to set the agenda economically, socially and
politically. Resolving inequality and sexual apartheid in community and sustaining it, is a
fundamental principle of democracy. This principle also, constitutes one of the fundamental
principles of the sustainable development. Therefore, while making feminine policies
sustainable and generalizing in community, there are a lot and different things to do for
different institutions, and there is a need to handle this subject integrated and cooperatively.
In this study, local governments’ feminine studies and sustainability of this are worked on.
For this purpose interviews have been made, studies of institutions are investigated on site
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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

and evaluated. The place of women in Local development plans and appreciation are worked
on. It is thought that the awareness on woman will rise with this study, which emphasizes that
with policies and implementations which are not sustainable; actions taken will not be
persistent.
Keywords: Sustainable development, Local government, Development plan, Feminine
policies, Women.

1.INTRODUCTION
Up to now, in nearly every society, policies and structures have been shaped favouring male
benefits, and male-dominated structuring has brought along gender inequalities. Corporate
and cultural structures affected by the norms of patriarchal societies have forced women to a
secondary status against men. Housework and motherhood roles, which have occurred as a
result of the sexist labour division, have been considered as women’s natural roles in the
society (Dedeoglu, 2011:63). While women were kept outside the public fields by usually
being employed as nurses or teachers, which are suitable professions for their traditional
roles, men have continued to be the ones who make the laws (Meena, 1992). While the social
labour division has restricted women with specific fields, it has integrated men with the
public fields (Caglar, 2011:62). Women have remained as small minorities concerning the
parliament, cabinet, and the administrative positions in the public/private sectors (Meena,
1992).
Women and men do not use the common living spaces in the same way and value. The
chances they possess for benefiting from the socio-economical opportunities offered by the
living environment as well as their needs and problems are not the same. Thus, (lack of)
policies intended on common living spaces have a greater effect on women (Alkan, 2004a).
The factors and cliché judgements that effect women’s reach/equal reach to several fields
such as education, health, land management and finance do not only restrict women’s hope
but also the future of nations. It is highly necessary to make legislations in order to support
women in realising their potentials, defending their rights and empowering (Bachelet, 2012).
“Studies which focus on preventing gender discrimination and increasing the status of women
in the society are among the most seriously conducted activities of the modern societies of
our day. In this sense, in many countries new regulations protecting women’s rights are
passed and some malfunctions which cause inequalities between men and women in the
society are worked on to eliminate them” (Tugen, Ozen, 2008:2).
The right to vote and stand for election has been entitled to women, however they have been
prevented from participating in the decision making processes using their traditional role as
an excuse or it has not even seen necessary for women to think on these kinds of issues.
Because the primary duty of a woman is being a mother and wife and it would be unfair to
her if she were given more duties (!). The number and variety of the obstacles brought to
women have increased day by day such as poverty, timelessness, lack of technical
information, lack of self-esteem, family, neighbourhood and tribe relations and honour codes
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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

(Bora, Isat, 2006:13). Even labour unions have maintained a patriarchal point of view while
defending women’s right to work instead of considering women’s priorities first. They have
defended equal wages for equal labour but kept their silence on the issue of women’s
employment on equally valued positions (Urhan, 2009:85).

2. SUSTAINABLE WOMAN POLICIES
The quality of life depends on the quality of the environment. The right to live is universal for
every living being and it is inacceptable to think that a species is entitled with this right more
than any other species is (Yıldıztekin, 2009:370). However, in nearly every society policies,
decisions and actions have always emerged with a focus on men, women have always
followed after men or been forced for that deliberately or not, and their rights have always
been more restricted. Politics has been perceived as a tool belonging to and empowering a
minority –men- in the society, and policy makers –men- have always obtained the power by
using politics. Women’s struggle to show and prove themselves (entering to business life,
founding organisations or becoming members of them) has been perceived as a threat, which
might harm the balances in the society and has been subject to resistance (Bora, Isat,
2006:15). However, sustainable development depends on the equal distribution of the sources
for today and tomorrow. This can never be managed without gender equality. Gender
equality is not only a key issue for sustainable development, but also an objective on its own
for social development and environmental sustainability (Informal Document,
2011:7;Flannery, 2011).
If the main objective of sustainability is thinking of future, assuring the benefits of future
generations, and meeting their current needs without limiting their skills and opportunities;
women should also be included in the process of sustainable development (Ozyol).
Sustainable development cannot be maintained without the equal distribution of the sources
both today and tomorrow. While meeting the needs of people, these policies should definitely
avoid risking the ability of future generations to meet their own needs (Informal Document,
2011:20).
In order to ensure woman participation to the development process, patriarchal ideologies
should change. Giving women no chance of involvement in the economical sustainable
development plans shall make a sustainable development impossible. Sustainable
development is only possible with proper planning and management of quality human
resources (Meena, 1992).
Regarding the active participation of women to sustainable development, education is an
important factor. Educated women are able to bring up the future generations. They make
more suitable and proper preferences on that sense and they bring up healthy generations

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(Vizyon 2050, 2010:48). In this respect, investments which target improving women’s
living and lifestyle are quite important concerning sustainability. Management of the natural
resources and climate changes affect primarily women due to their role in the family
(Bachelet, 2012). It is easier for educated women to adopt a sustainable lifestyle. Educated
women contribute to society in several ways as mentioned below: (Vizyon 2050, 2010:48);
They possess detailed product information or demand information.
They share feedbacks with the companies from which they purchase the products (sharing
expectations and areas of interest). This way they provide chances for increasing the abilities
of these companies for managing sustainability.
Life quality of women increases with education. Thereby their negative impact on the
ecological environment decreases and they find solutions.
They transfer the traditional knowledge and skills to future generations.
They contribute to environment in terms of hygiene and recycling.

3.SUSTAINABLE WOMEN POLICIES IN LOCAL ADMINISTRATIONS
It has been accepted in 1992 United Nations Environment and Development Conference held
in Rio de Janeiro that social, economical and environmental factors affect each others’
concerning sustainability. The resolutions that emerged from this summit are called ‘Agenda
21’ and with those resolutions it was aimed to prepare the World to the next century. ‘Agenda
21’ is an action plan including the activities local administrations should follow as well
(Yapıcı, 2003:225). It was stated in the action plan that together with other actors, local
administrations should start a participatory process, determine the environmental and
development problems in the cities and build a local agenda (Bora, Isat, 2006:42). Local
administrations are parties of this responsibility in terms of their position and structure. Local
administrations meet the spatial, public, socio-cultural and common economical needs of the
people residing in a city and solve the problems of people*1. Local administrations are
obliged to ensure that people live and work in secure, healthy environments and urban areas
are used efficiently. While providing these services, they also have to participate in the
 -such as a decrease in infant death rate, malnutrition cases and birth rate, making conscious
preferences concerning consumption, creating an awareness relating the importance of insurance
against the risk of disasters, increasing household income levelsTasks such as construction, water, sewer system, fire departments, police service, traffic, marriage
registration, providing vocational opportunities, public transportation, landscaping, protection of the
land, preventing erosion, supports, forestation, building parks and gardens, emergency rescue, social
services, protection houses for women and children, civil defence duties, and duties concerning the
elections.

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decision-making processes concerning the areas they are responsible for and audit the
services provided (Tokman, Kendirci, 2006). Local administrations are accepted as the
schools of democracy and they are more advantageous compared to central administrations in
determining the needs of people properly and meeting those needs directly (Seyyar, 2008:30).
Although women are in close relations with the environment they live in and sustainability,
they are not participating adequately to decision-making processes concerning sustainability
issues both in the local and national levels. Participation of women to local administrations is
lower than 1 % (Bora, Isat, 2006:35). In this respect, it is obvious that women should be
included to the decision makers of local administrations.

4. EVALUATION OF THE (LACK OF) SUSTAINABLE POLICIES TARGETING
WOMEN IN ISPARTA LOCAL ADMINISTRATIONS
The scope of this study is, determination of the work conducted by Isparta Provincial
Administration and Isparta Municipality with the aim of reaching women who are among
disadvantageous groups, evaluation of the sustainability of these studies and introduction of
new strategies on this regard.
In this study one of the most important findings is the fact that local administration units are
not conscious enough in women studies and this situation has restricted the service areas
aimed at women (training courses, women assemblies, women clubs, women guest houses,
art centres, kindergartens etc.) This restriction has narrowed our work areas as well. During
the study, relative literature obtained from the secondary resources has been examined; data
obtained from Isparta Provincial Administration General Secretariat and Isparta Municipality
Cultural and Social Programs Directorate (ISMEK) has been evaluated and face-to-face
interviews have been conducted with officials.
The low percentage of woman participation in the decision-making processes around Turkey
is quite noticeable in Isparta local administration units as well. During March 2009 Local
Administrations Election, only 3 women were nominated as mayor candidates in 13
provinces in total including Isparta centre province as well. When the 2009 Provincial
Council nomination and election outcomes are evaluated, it is seen that 26 (9, 7%) woman
candidates participated the elections against 240 (90, 3%) male candidates and only 1 (0, 3%)
woman entered the city general assembly. For 2009 Municipality Council Elections 558 (88,
9%) candidates nominated while the number of woman nomination was strikingly only 63
(11, 1%). After the elections the total number of women in the municipal councils of 13
provinces was 12. Again in 2009 in the centre province of Isparta there were only 3 (4, 8%)
women neighbourhood headman (mukhtar) against 59 (95, 2) men headman (Tureli, Caglar
2010:34). Under the light of all this data, it is clear that woman representation in Isparta
Local Administration Units is notably limited.

It was announced in 2006 that a ‘Woman Guesthouse’, which is based on providing direct
services for women was founded in Isparta. Isparta Municipality provided the building for the
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‘Women Guesthouse’ and Isparta Provincial Administration furnished it. Isparta
Municipality’s studies on women were examined, it was seen that ‘Productive Women
Bazaar’ Project organized within the scope of Isparta Municipality Arts and Vocational
Courses, which are known as ISMEK in short, have entered into service starting from 2010
and have met a considerable interest regarding the appreciation of woman labour. In the
scope of 2010 ‘8 March International Women’s Day’ 160 women opened food and handicraft
stands in ‘Productive Women Bazaar’, which was arranged in a shopping mall for a short
period of time, 7 days. ‘Productive Women Bazaar’ organized in the city centre every year on
April lasts for 6 months and no stand fee or charter fee is demanded from the women.
‘Productive Women Bazaar’, which is a social project, is applied in the districts which are
popular among the society.
When women producers who open stands in productive women bazaar are evaluated on
yearly basis, it is seen that women contribute to family budget with the profit they make from
food and handicraft stands (Table 1).
Table 1. Women Producers that Open Stands in Productive Women Bazaar
Participation

Food Stand
Participation

Handicraft Stand
Participation

Total
Participation

Year

F

%

F

%

F

%

2010

298

54

255

46

553

100

2011

104

40

158

60

262

100

Source: ISMEK, Isparta, ( 30.03.2012).

When the data of Isparta Municipality is examined, vocational courses operating in
cooperation with Isparta Public Training Center and Evening Vocational Schools draw
attention. It was observed that only women preferred courses planned according to traditional
woman roles such as sewing, lace and ribbon works. It was determined that both men and
women participated in foreign language, literacy and computer courses.

When the course distribution according to gender is examined (Table 2), the lack of courses
intended only for women compared to the number of courses to which women and men
participate together draws attention.
Table 2. Course Distribution According to the Gender of Participants
Courses
Participants
Woman+Man
Woman

110

Courses opened
in 2009

Courses opened
in 2010

Courses opened in
2011

F

%

F

%

F

%

59

94

36

77

48

84

4

6

11

23

9

16

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Total

63

100

47

100

57

100

Source: ISMEK, Isparta, ( 30.03.2012).

When the distribution of certificates regarding the gender of participants is examined (Table
3), it is seen that the number of woman participants obtaining certificate is higher compared
to men on a yearly basis. Women participation to the courses is higher than man
participation. We can perceive this as an indicator of women’s endeavour and demand in
having a profession and being active in public fields and business life.
Table 3. Distribution of Certificates Regarding the Gender of Participants
People that
received
certificate

2009
F

2010

2011

%

F

%

F

%

Women

954

70

671

75

626

79

Men

417

30

226

25

166

21

Total

1.371

100

897

100

792

100

Source: ISMEK, Isparta, ( 30.03.2012).

5.CONCLUSION
Sustainable development cannot be managed without complete and equal participation of
women on every level. Up to now, concerning both the national and local level, women have
been inadequately represented. It should be assured that women participate the national and
local decision-making mechanisms equally with men. Political parties should abandon the
perspective (inequality) which considers women as keys of reaching households during
election processes, and after that violates their right to possess seats in the councils or gives
them seats only in the number political parties themselves shall decide. The main intentions
of local equality action plans are establishing strategies to increase the level of woman
participation concerning local decision making processes, increasing their standards of living,
ensuring the implementation of these strategies and managing equality on every level.
However Isparta local administrations have not started any activity yet in the scope of Local
Equality Action Plans.
On the local level (in Isparta) the status of woman should be determined socially,
economically and politically and a case assessment (demographical structure, number of
woman enterprises, woman foundations, number of woman executives) should be conducted.
The problems of the groups, which will be formed according to the outcomes of this
assessment and their casual relations, should be discussed and objectives should be
determined. Control points should exist during the implementation of the activities
(producing local projects, finding funds, protecting the environment and health of women,
increasing their standards of living) arranged with the aim of reaching the objectives and
deficiencies should be eliminated on time. It is also highly important not to forget supporting
the productive and reproductive role of women when policies are concerned (Meena, 1992).
111

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

While arranging action plans regarding the objectives, collaborators and partners (media,
universities, political parties, and associations) should be determined and the sources we have
should be combined. Local women organisations, assemblies, expertise councils and
provincial councils should be formed with equal participation of women in order to eliminate
the cliché judgements in the society such as the place of woman is her home or husband is
free to beat or caress his wife*2 (Alkan, 2007b). It must be made possible for women to live
in an easier and more secure way in the cities. Local administration units should follow action
plans formed upon equality. During those implementations women’s value and sustainability
should be placed to the centre of life, and this consciousness should be obtained throughout
the society under the leadership of local administrations.
In Isparta where we conducted our study, the lack of sustainable policies for assuring equality
between women and men in local level, empowering the status of women in public context
and ensuring their representation in decision-making processes is quite noticeable. This is a
clear indicator of women’s secondary status.

REFERENCES
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http://kasaum.ankara.edu.tr/gorsel/dosya/1216284579yerel_siyaset_kadinlar_icin_neden_one
mli.pdf. (05.04.2012).
Alkan, A.(2007b) “Yerel Eşitlik Eylem Planlarına İlişkin Değerlendirme Raporu”,
http://www.sabancivakfi.org/sayfa/yerel-esitlik-eylem-planlari. (02.04.2012)
Bachelet, M. (2012) “Rural Women And Sustainable Development”, United Nations Entity
For Gender Equality and The Empowerment of Women,
http://www.unwomen.org/2012/02/rural_women_and_sustainable_development/
27.02.2012, ECOSOC Chamber, UN headquarters, New York. (07.03.2012)
Bora, A., İşat C. (2006) Düğüm Bilgisi, KADER, İkinci Baskı, Ankara.
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*’Sensitivity to women’ trainings should be organised for the staff employed in Governerships,
Municipalities, Women Gueasthouses.

112

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Informal Dokument (2011), Empowering Women For Sustainable Development, Economic
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Mücadeleleri:

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2003;
5(1):223-229
http://www.aku.edu.tr/AKU/Dosya
yönetimi/SOSYALBILENS/dergi/V1/myapıcı.pdf. (15.04.2012)
Yıldıztekin, İ.(2009) “Sürdürülebilir Kalkınmada Çevre Muhasebesinin Etkileri”, Atatürk
Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 13-(1), 367-390.

113

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                <text>Nowadays, feminine policies have begun to set the agenda economically, socially and  politically. Resolving inequality and sexual apartheid in community and sustaining it, is a  fundamental principle of democracy. This principle also, constitutes one of the fundamental  principles of the sustainable development. Therefore, while making feminine policies  sustainable and generalizing in community, there are a lot and different things to do for  different institutions, and there is a need to handle this subject integrated and cooperatively.  In this study, local governments’ feminine studies and sustainability of this are worked on.  For this purpose interviews have been made, studies of institutions are investigated on site and evaluated. The place of women in Local development plans and appreciation are worked  on. It is thought that the awareness on woman will rise with this study, which emphasizes that  with policies and implementations which are not sustainable; actions taken will not be  persistent.  Keywords: Sustainable development, Local government, Development plan, Feminine  policies, Women.</text>
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