Furkan Kilic
Associate Economist · World Bank Group
Furkan Kilic
Associate Economist | World Bank Group
I am an associate economist in the Development Economics Private Markets department of the World Bank Group and International Finance Corporation (IFC). My research focuses on growth, firm dynamics, and the role of innovation and knowledge spillovers in shaping productivity and long-run development. I combine theory with large-scale data to study how firms and technologies interact, and how these interactions influence aggregate outcomes.
I received my Ph.D. in Economics from the University of Chicago in 2024.
My Curriculum Vitae is available here.
My email address is [email protected].
Working Papers
Abstract
Where does innovation truly thrive? Inventive activity in the US is strikingly concentrated in a handful of hubs. This raises compelling questions: Does further agglomeration drive innovation, or could a more dispersed approach better leverage regional spillovers? To investigate, I exploit variation in patent citation lags across US states and develop a novel endogenous growth model with mobile inventors and workers. The model integrates an exogenous knowledge network that facilitates the dynamic exchange of ideas—laying the foundation for future inventions—between locations, revealing that inventors do not internalize how their location choice influences broader knowledge diffusion. These knowledge spillovers call for a targeted, place-based R&D subsidy to unlock latent innovation potential. Calibrating the model to data on inventor and worker allocations—and estimating the knowledge diffusion network from patent citations—I find that optimal policy would further concentrate inventors in established hubs, enhancing welfare by 1.8% in consumption-equivalent terms and boosting the economy’s long-run growth rate by 0.14 percentage points.Abstract
As Ukraine emerges from the devastation of war, it faces a historic opportunity to engineer its own Wirtschaftswunder—a productivity-driven economic transformation akin to post-war West Germany. While investment-led growth may offer quick wins, it is efficiency, innovation, and institutional reform that will determine Ukraine’s long-term economic trajectory. Drawing on rich micro-level firm data spanning 25 years, this paper uncovers deep structural distortions that have suppressed creative destruction and productivity in Ukraine. It finds that business dynamism is on the decline, alongside rising market concentration among incumbent businesses, including low productivity state owned enterprises. To inform priorities for reviving business dynamism, this study develops a model of creative destruction drawing on Acemoglu et al. (2018) and Akcigit et al. (2021). The quantitative assessment highlights that policies that discipline entrenched incumbents are the bedrock for reviving business dynamism and engineer Ukraine’s Wirtschaftswunder. Policies targeting specific types of firms have limited efficacy when incumbents run wild.Abstract
Even 30 years after reunification, regions in East Germany (the former GDR) experience considerably different economic conditions than in the West German regions, with the average GDP per capita still about 20 percent below the average Western level. We explore the factors that impeded convergence, with a particular focus on technological differences and firm behavior. In the immediate aftermath of the reunification, per-capita output in East German regions exhibited rapid catch-up with the West with notable labor productivity gains. But convergence quickly tapered off, with substantial gaps between East and West German firms’ product qualities persisting ever since. A new quantitative model of innovation, competition, and regional integration, which can mimic these dynamics, provides a suitable setting to evaluate alternative policies that could have altered the trajectory of convergence. We find that large initial technological differences depressed Eastern firms’ incentives to compete and invest in technology improvements, perpetuating initial gaps. Delaying reunification, by shielding Eastern firms from Western competition, would not have helped Eastern firms build up capacity. Sustained support for R&D in the East from the West could have reduced product quality and income gaps. Yet more welfare-improving alternatives exist: subsidies to R&D by Western firms, with knowledge spillovers lifting Eastern technology as well, or schemes to facilitate technology transfer to the East via licensing from Western firms, with gains occurring at different horizons.Work in Progress
The Inequality–Growth Nexus: Evidence and Theory from Capital Goods Innovation
Abstract
Over the past few decades, the U.S. economy has experienced a slowdown in per capita GDP growth alongside a persistent rise in household inequality. A key driver of this divergence appears to be the increasing concentration of business assets at the top of the wealth distribution and growing inequality across firms. To explore the role of technology in this pattern, I construct a novel dataset by matching Wikipedia text descriptions of capital goods to patent texts using modern machine learning techniques. Using this dataset, I document two main empirical findings. First, within-sector inequality across firms tends to decline following positive technology shocks to tangible capital goods. Second, innovation in tangible capital goods has been steadily declining over time. To interpret these findings, I develop an endogenous growth model with heterogeneous households, wealth inequality and capital-augmenting innovation. In the model, innovation affects inequality through its impact on the rate of return to capital: it lowers capital gains by reducing the resale value of old capital, while increasing returns via higher dividend yields on newer, more productive assets. I use the model to analyze the long-run effects of declining corporate tax rates and find that lower taxes can reduce long-run growth—challenging the conventional view that tax cuts promote innovation. The results suggest that policies aimed at reducing inequality can be compatible with, and even enhance, long-term growth.
Measuring Productivity, Business Dynamism, and Economic Growth: The Case of Colombia and Turkiye
High-Growth Firms and the Demand for Skills: Evidence from Job Postings
Productivity Dynamics Framework
Superstar Spillovers: Productivity Gains and Sales Reallocation
Increasing Returns in AI Production: Endogenous Concentration and Adoption