EXPORT STRUCTURE AT THE EXTENSIVE AND INTENSIVE MARGINS: THE CASE OF EMERGING ECONOMIES

Year 2012, Volume: 4 Issue: 2, 65 - 76, 01.12.2012

Gulcin Elif Yucel A. Suut Dogruel

Abstract

There is a consensus that increased exports have some benefits by enabling countries to generate more revenue. But rather than exporting more, how a country achieves high export performance is a more important question. Recent empirical literature highlights that intensive and extensive margins have different contributions to the export growth. Thus, export structure across the countries and products differs according to the effects of these margins. Developed countries have lost market share in goods exports to emerging economies, especially China. In other words, the reason of this loss of market share by most advanced economies is the increase in exports from emerging economies. In this study, we will focus on the export structure of Turkey -as well as Brazil, China, India, Mexico and Russia (BCIMRT) as benchmark countries- by providing a detailed analysis of which areas of goods contribute to the intensive and/or extensive margin growth and which margin dominates. In this study, ISIC Rev.3 4-digit level trade data is used which is available at the United Nations Commodity Trade Statistics (COMTRADE) database for 2000-2010 period. By using descriptive statistics on BCIMRT’s exports to the world, we decompose trade into its extensive and intensive margins and try to answer whether export has increased most through new partnerships or through expanding existing trade flows in these selected emerging economies

Keywords

Extensive Margin, Intensive Margin, Emerging Economies

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