Mahfi Eğilmez responds to the question 'If there is a crisis, who is filling the restaurants?'! 'In summary, we can say this...'

Economist Dr. Mahfi Eğilmez, in his article titled 'What crisis?', responded to the question of whether there is a crisis in Turkey based on the 2023 Income Distribution statistics from TurkStat.

In his article, Eğilmez also revealed who is filling the restaurants and cafes.

Here is Eğilmez's article titled 'What crisis?';

"When we look at restaurants, cafes, and roads, we encounter people spending money everywhere, and then we ask ourselves the following question: “If there is a crisis, who are these people spending so lavishly?” Because these are not just three or five people; they are a large number of people, including white-collar workers. Some, looking at both situations, suggest that a part of society is in a crisis, while a smaller part is not affected by this situation, which could be described as a crisis for the other group. Which observation and diagnosis is correct? I think the observation of the third group seems correct. Let's elaborate on this.

The latest income distribution data we have is included in the report titled 2023 Income Distribution Statistics by TurkStat, which examines the issue using 2022 data. In the table below, which I prepared based on the data in this report, the shares of the 20 percent segments of the population in GDP are presented:

Accordingly, in 2022, half of the 906 billion dollar GDP (451 billion dollars) was shared by the top 20 percent of the population with the highest income (17,055,991 people). The average income per capita in this group is 26,453 dollars. The remaining 80 percent of the population shares 454.8 billion dollars. The income per capita in this group is 6,668 dollars. The income of the lowest 20 percent of the population is 3,134 dollars.

NO CRISIS FOR 17 MILLION PEOPLE

For the 17.1 million people with the highest income in the population, there is no crisis. The situation of the next 20 percent of the population is mixed, but in general, those with higher incomes among them are not affected much by the crisis either.

In this case, an interesting situation emerges. Approximately 25 million people are not as affected by the crisis as the remaining 60 million people. They are the people we see in those restaurants, cafes, and cars on the roads. Some of the others see this situation as temporary and try to live like them by going into debt. But the rest are truly in a crisis.

Although it is in a slightly better situation than us, the situation in Argentina is similar to Turkey. According to 2022 data, 47 percent (297 billion dollars) of Argentina's GDP (631 billion dollars in 2022) is shared by 20 percent (9.2 million people) of the population (46.2 million people in 2022). The average per capita income of these 9.2 million richest people is 32 thousand dollars.

WE HAVE SURPASSED ARGENTINA IN INCOME INEQUALITY

The remaining 80 percent of the population (37 million people) shares the remaining 334 billion dollar portion of the income. Their average per capita income is 9 thousand dollars. The Gini coefficient is 0.43 in Turkey and 0.42 in Argentina.

As can be seen, the two countries are quite similar in terms of income distribution. In Argentina, too, those in the upper income group fill restaurants, cafes, and roads, while lower income groups complain about not being able to make ends meet.    

In summary, we can say this:

In both Turkey and Argentina, there is a crisis according to some, and there is no significant situation according to others. Your perspective and your judgment regarding those in the low-income group change depending on which group you are in.

News Source: 12punto