Essays on Export Competitiveness in Türkiye

Abstract

Building on an integrated framework of product-based, competitor-based, and market-based analyses, this study provides an overarching insight into the structure of Türkiye's export competitiveness and examines the specific factors shaping it. The first essay employs the Generalized Method of Moments (GMM) technique to analyze Türkiye’s product-level competitiveness from 1996 to 2021, revealing the country’s challenges in exporting high-complexity products. The findings also indicate that product complexity plays a more significant role than exchange rate fluctuations in determining export competitiveness. The second essay investigates the impact of China’s growing presence in the EU market on Türkiye’s exports using OLS, 2SLS, FE-IV, and Fixed Effects Models for the same period. The findings reveal a complementary rather than competitive relationship between Türkiye’s and China’s exports in the EU market, highlighting synergy rather than rivalry. Additionally, the study underscores the EU’s strategic importance for Türkiye and emphasizes the role of exchange rate stability and diplomatic relations in strengthening trade within this market. The third essay examines market-driven factors influencing Türkiye’s export performance across different destinations, considering variations in periods, product types, and technology levels. The findings demonstrate that factors such as income levels, macroeconomic stability, institutional quality, and ease of doing business in export markets positively affect Türkiye’s exports. Throughout all sections, the determinants of Türkiye’s export competitiveness are tested for robustness using various econometric techniques to mitigate endogeneity and heterogeneity concerns. The study concludes with targeted policy recommendations aimed at enhancing Türkiye’s export competitiveness through diversification, innovation, and the strengthening of diplomatic and institutional ties.