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25/01/2019 - 21:29

Subcontracting dynamics and economic development: A study on textile and engineering industries

Erol Taymaz and Yılmaz Kılıçarslan

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Recent studies on small and medium sized establishments emphasize the importance of networking and regional clusters for industrial development. This study is focused on an important form of cooperation between firms: subcontracting relationship. Our aim is to estimate the determinants of subcontracting in Turkish textile and engineering industries, and to derive policy implications of our estimates. We estimate subcontract offering and subcontract receiving models for both industries by using panel data on all establishments employing 25 or more workers in the period 1988-97. Our findings show that short-term/unequal relationship exists between parent firms and subcontractors in the textile industry whereas subcontracting relationships in the engineering industry are established between "similar", relatively advanced firms that have complementary assets and technologies.

Does Innovativeness Matter for International Competitiveness in Developing Countries? The Case of Turkish Manufacturing Industries

Emre Özçelik and Erol Taymaz

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Contents: I. Introduction. - II. Evolution of the Theory of International Trade: Attitudes towards the Technology Factor and the Schumpeterian Viewpoint as a Rationale for Studies at the Firm-Level. - III. A Survey of Firm-Level Studies on the Determinants of Export Performance with an Emphasis on Technology Factor. - IV. Technological and International Competitveness of the Turkish Manufacturing Industry. - V. Determinants of International Competitveness: Estimation Results. - VI. Concluding Remarks.

Turkish Twin Effects: An Error Correction Model of Trade Balance

Elif Akbostancı and Gül İpek Tunç

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Twin deficit hypothesis mainly states that government budget deficits will cause trade deficits. However, this is not the only theoretically possible relationship between the budget deficit and the trade deficit. On the other extreme if Ricardian equivalence hypothesis holds it is also possible that two deficits are not related at all. In this study these hypotheses between the budget deficit and trade deficit for Turkey between 1987 - 2001 period are examined by using the cointegration methodology and by estimating an error correction model. This enabled us to search the relationship between the internal and external deficits both in the short-run and in the long-run. Our analysis showed that there is a long-run relationship between the two deficits. Also the short-run model yielded that worsening of the budget balance worsens the trade balance. Therefore we have concluded that the twin deficit hypothesis holds, and Ricardian equivalence hypothesis is not valid for Turkey during the study period.

İktisadi Kalkınma ve Kadınların İşgücüne Katılımı: Türkiye'den Zaman-Serisi Kanıtları ve İllere Göre Yatay Kesit Kestirimleri

Aysit Tansel

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Bazı araştırmacıların son zamanlarda belirlediği varsayıma göre kadınların işgücüne katılım oranı iktisadi kalkınma sürecinde U-biçimli bir eğri sergilemektedir. Bu makale, Türkiye'de kadınların işgücüne katılım oranlarına ilişkin zaman-serisi kanıtlarına yer veriyor ve illere göre yatay kesit belirleyicilerini ele alıyor. Zaman serisi kanıtları gösteriyor ki, sert inişli bir döneminin ardından, kadınların işgücüne katılım oranlarının düşme hızında son zamanlarda bir yavaşlama görülmektedir. Önümüzdeki birkaç on yıl içinde bu oranların çıkışa geçmesi beklenebilir. Kadınların işgücüne katılım oranlarının illere göre yatay kesit belirleyicilerinde kullanılan kalkınma ölçüsü her ilin kişi başına Gayrisafi Hasılasıdır. Kestirim modellerine, kişi başına Gayrısafi İl Hasılası'nın karesi ve başka belirleyiciler katılmıştır. Kestirim modellerinin kurulmasında 67 ilin 1980, 1985 ve 1990 zaman-konaklarına ait verileri kullanılmıştır. Elde edilen sonuçlar iktisadi kalkınmanın doğurduğu U-biçimli etkiyi doğrulamaktadır. Bunun ötesinde, kadınların işgücüne katılım oranı üzerinde işsizliğin önemli ölçüde cesaret kırıcı etkisi olurken, öğrenim durumunun büyük olumlu etkisi görülüyor. Gizli işsizlik hesaplamaları, gösteriyor ki, kentlerde kadın işsizlik oranı, olduğundan eksik hesaplanmaktadır ve ümidini yitirmiş işçi etkisi kadınlarda önemli düzeyleri bulmaktadır.

Economic Development and Female Labor Force Participation in Turkey: Time-Series Evidence and Cross-Province Estimates

Aysit Tansel

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Recently, several researchers hypothesized that female labor force participation rate exhibits a U-shape during the process of economic development. This paper provides time series evidence on female labor force participation rates in Turkey and considers its cross-provincial determinants. Time series evidence shows that after a period of sharp decline the female labor force participation rates have exhibited a slowdown in the rate of decline recently. An upturn in this rate may be expected during the coming decades. In the cross-provincial determinants of female labor force participation the measure of development used is per capita Gross Provincial Product. A quadratic term in per capita Gross Provincial Product and other determinants are included in the models estimated. The models are estimated using data for 67 provinces for three time points-1980, 1985 and 1990. The results affirm the U-shaped impact of economic development. Further, unemployment had a considerable discouraging effect on female labor force participation while the impact of education was strongly positive. The hidden unemployment computations indicate that urban female unemployment rate is underestimated and the discouraged-worker effect for women is substantial.

Bread and Empire: The Workings of Grain Provisioning in Istanbul During the Eighteenth Century

Onur Yıldırım

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Provisioning of the Imperial capital İstanbul had been one of the major concerns of the Ottoman rulers from the classical age to the dawn of the modern era. Grain occupied a particularly important place in the provisioning policies of the Ottoman state due to the fact that the Ottoman sultans considered the steady supply of "people's bread" in the capital city as one of the ways to promote and reproduce their image of sovereignty in the general public opinion. This consideration remained unchanged throughout the eighteenth century during which time the Ottoman economy faltered vis-à-vis the European centered world-economy and the Ottoman polity began to gradually withdraw from the economic realm. In the face of mounting fiscal burdens, the Ottoman state limited its provisioning policies to the raw materials needed by the military industries and to the basic foods consumed by the populace. In this context, the traditional protectionist attitude of the state towards the craft guilds of the imperial capital was abandoned, leaving these organizations at the mercy of circumstances not to say the market principle. The only institutions that were insulated from the changing policy of the state were the grain-related crafts, i.e. bakers' guild. This paper argues with reference to a series of published documents that the Ottoman state continued, if not hardened, its provisioning policies of grain to the imperial capital during the eighteenth century and thereafter.

The Effects of Privatization on Labor in Turkey

Aysit Tansel

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The effect of privatization on labor has been one of the least addressed issues. This paper evaluates the impact of privatization on dismissed workers in Turkey. Earnings equations at state employment and after dismissal are estimated and compared to evaluate the changes in worker's welfare. Dismissed workers experienced significant earnings losses upon reemployment. Earnings losses were smaller for the self-employed than for the wage employed. Post-dismissal jobs were not only characterized by lower earnings but also by a lower quality of non-monetary attributes. The magnitude of the true welfare losses is inferred from the subjective evaluations provided by the workers themselves. Workers felt that what they had lost had not been fully compensated by the severance pay they received.

The Determinants of Earning Differentials in Ankara and Istanbul

İ. Semih Akçomak and Zehra Kasnakoğlu

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In this study, an attempt is made to compare and contrast the determinants of earnings differentials in Ankara and İstanbul. The determinants of earnings differentials are first examined with semi-logarithmic single equation models based on the basic human capital approach. Secondly, extended models are formed in which all the variables are expressed as dummy variables. In general, the average per hour earnings in İstanbul, is higher than in Ankara. It is found that age, gender, education and job status have significant effects on the explanatory power of the model, whereas occupation and marital status have only limited effect.

Do PPP and UIP Need Each Other in a Financially Open Economy? The Turkish Evidence

İ. Aysun Gökcan and Erdal Özmen

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This paper investigates the empirical validity of the capital enhanced equilibrium exchange rates (CHEERs) model for the Turkish data. The results of the Johansen cointegration analyses for the variable system containing Turkish and US inflation rates, interest rates, and exchange rate suggest the existence of two stationary relationships explaining the long run evolution of Turkish interest rates and inflation rates, respectively. The results of the structural model obtained by data-acceptable over-identifying restrictions over the cointegration space suggest the non-rejection of the hypothesis that the first vector contains uncovered interest parity (UIP) and the second vector contains purchasing power parity (PPP) with proportionality and symmetry conditions. Consistent with the CHEERs approach, each of the international parity hypotheses is strongly rejected when formulated independently. This is a theory-consistent result for a financially open economy for which equilibrium conditions of asset and commodity markets may not be independent of each other.