Determınants of Sectoral and Fırm Sıze Export Performance: Empırıcal Evıdence from the Turkısh Manufacturıng Industry

Abstract

DİNÇER, Ahmet. Determinants of Sectoral and Firm Size Export Performance: Empirical Evidence from the Turkish Manufacturing Industry, Ph.D., Ankara, 2021 Export is considered as one key element of economic development and growth. Export is the source of foreign exchange earnings, economies of scale and specialization, and new technology. Therefore, understanding the factors that determine export performance is vital to design and implement trade and industrial policies aimed at stimulating exports. The manufacturing industry export performance draws a growing interest in theoretical and empirical studies. Turkey’s manufacturing sector recorded a remarkable export performance over the last two decades. The share of Turkey in world exports has increased from 0,44% in 2000 to 0,92% in 20171 . The main purpose of the thesis is to address microeconomic (sector-specific) and macroeconomic variables that affect export performance both at the sectoral level and at the sectoral level classified according to small, medium, and large firm size. To the best of our knowledge, this study is the first one focusing on the microeconomic (R&D, bank credit, profitability, etc.) and macroeconomic (the real exchange rates and external demand) determinants of export performance of manufacturing industry sectors and manufacturing industry sectors according to firm size. In addition, the sectoral real exchange rate and trade partners’ growth rates are calculated for 23 manufacturing sectors. The determinants of manufacturing industry sectors and firm size export performance (small, medium, and large-sized firms) in the Turkish manufacturing industry are estimated using the IV-2SLS and the system GMM methods to overcome the endogeneity problem in the models. The estimation results of the sectors demonstrate that lagged export volume, R&D and bank credits are the factors that stimulate export performance, while reel exchange rates and growth rates of trade partners are the other factors that have a significant impact on export performance. The findings for firm size are somewhat mixed and vary according to firm size. Our estimation results suggest that specific export promoting policies should be implemented tailored to the needs of firm size. Keywords: export performance, manufacturing industry, determinants of exports, exports based on firm size, sectoral external demand, and sectoral real exchange rates.