International Congress on Eurasian Economies

International Conference on Eurasian Economies

11-13 October 2012 – Almaty, KAZAKHSTAN

Paper detail

Paper ID : 389
Status : Paper published
Language : Turkish
Topic : International Trade and Globalization
Presenter: Mr. Sezai Ata
Session : 2C Uluslararası Ticaret II

Turkey’s Export Potential: A Gravity Model Analysis
Türkiye’nin İhracat Potansiyeli:Çekim Modeli Çerçevesinde Bir İnceleme

Abstract

Given the high level of integration of the world economy, foreign trade has become very important for the development of a country. Even though Turkey exports goods and services to the majority of countries in each continent, until recently Turkey has basically focused on exports to developed European countries. The main purpose of this study is to analyze Turkey's export potential with the help of the gravity model. For this purpose, first a gravity model has been set up using panel data which consists of bilateral data for 68 countries for the period 1980-2009, and then Turkey’s exports potential to 67 countries, accounting for more than 90 percent of Turkey’s total exports, has been calculated. The most important finding of the study is that Turkey’s exports in general is below potential and there is a further room for increasing exports. In this context, according to our analysis, while Turkey’s export potential has been used up especially for developed European countries, high levels of untapped export potential exists for the majority of neighboring countries and for some of the developing countries. Another finding from this study is that trade between two countries increases proportional to their GDPs and decreases proportional to the distance between them. While the existence of features such as common language, contiguity, being parts of the same state in the past and using the same currency increases the trade between two countries, the effect of some variables on trade such as the real exchange rate depends on countries' level of development.

JEL codes: F17

Ata, Sezai (2012). "Turkey’s Export Potential: A Gravity Model Analysis " in Proceedings of International Conference of Eurasian Economies 2012, pp.276-282, Almaty, KAZAKHSTAN.

DOI: https://doi.org/10.36880/C03.00389

Full paper in PDF format.

Session 2C: Uluslararası Ticaret II

Istanbul Beykent University Kyrgyz-Turkish Manas University Turan University TIKA Turkish Central Bank