THE EFFECTS OF TRADE AND PRODUCTIVITY ON EMPLOYMENT IN THE MANUFACTURING INDUSTRY OF TURKEY

Abstract

This study empirically analyzes the effects of international trade and productivity on employment in the Turkish manufacturing industry for the time period of 2003-2010 by using panel data. For this purpose, - the direct effects and - productivity related indirect effects of international trade on employment are estimated. The findings suggest that the direct effects of export demand and import competition on employment are sound and significant; while the increase in export demand leads to an increase in labour demand, the increase in import penetration reduces it. However, the productivity related indirect effects come solely from import competition. The total effects of international trade on emploment is mainly the result of the direct effects of export demand and import penetration. On the other hand, the positive contribution to productivity in the Turkish manufacturing industry comes mainly from investment and research&development expenditures

Keywords

• International Trade
• Export Demand
• Import Competition

THE EFFECTS OF TRADE AND PRODUCTIVITY ON EMPLOYMENT IN THE MANUFACTURING INDUSTRY OF TURKEY

Abstract

Bu çalışma, uluslararası ticaret ve verimliliğin Türk imalât sanayiindeki istihdama olan etkilerini, 2003-2010 dönemi için ve panel veri kullanarak ampirik olarak analiz etmektedir. Bu amaçla, uluslararası ticaretin istihdam üzerindeki doğrudan ve verimlilikle ilgili olarak dolaylı etkileri tahmin edilmektedir. Tahmin sonuçlarına göre, ihracat talebi ve ithalat rekabetinin istihdam üzerindeki doğrudan etkileri önemli ve anlamlıdır; ihracat talebindeki artış emek talebi üzerinde olumlu bir etki yaparken, ithalat rekabetinin artması bu talebi azaltmaktadır. Ancak, verimlilik vasıtasıyla olan dolaylı etkileri sadece ithalat rekabetinden gelmektedir. Uluslararasıticaretin istihdam üzerindeki toplam etkileri, esas olarak ihracat talebi ve ithalat rekabetinin doğrudan etkilerinin sonucudur. Diğer taraftan, Türkimalât sanayisinin verimliliğine pozitif katkı, büyük ölçüde, yatırım ve araştırma&geliştirme harcamalarından kaynaklanmaktadır.

Keywords

• Uluslararası Ticaret
• İhracat Talebi
• İthalat Reka

References

1. Abraham Filip and Ellen Brock (2003) : “Sectoral employment effects of trade and productivity in Europe”, Applied Economics, Volume 35, (2), pp. 223-238.
2. Ayaş, N. and H. Çeştepe (2010) : “Dış Ticaretin İstihdam Üzerindeki
3. Etkileri: Türk İmalat Sanayi Örneği, Süleyman Demirel Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, Vol. 15, No.2, pp. 259- 2
4. Baltagi, Badi.H (2005) : Econometric Analysis of Panel Data, Third
5. Edition, John Wiley & Sons. Bernard, A. B. and J. B. Jensen (1999) : “Exceptional exporter performance: cause, effect or both? ”, Journal of International Economics, Vol. 47, No. 1, pp. 1–25.
6. Bernard, A. B. and J. B. Jensen (2001) : “Exporting and Productivity : The Importance of Reallocation”, NBER Working Paper Series, No. 7135, pp. 1-31.
7. Breitung, J. (2001) : “The local power of some unit root tests for panel data”, Advances in Econometrics, Volume 15, pp. 161–177.
8. Castro, L., M. Olarreaga and D.Saslavsky (2007) : “The Impact of Trade

9. With China and India on Argentina’s Manufacturing Employment”, World Bank Policy Research Working Paper, No. 4153, pp. 1-30.
10. Dixit, A. and J.E. Stiglitz (1977) : “Monopolistic competition and optimum product diversity”, American Economic Review, Vol. 67, No. 3, pp. 297–308.
11. Dutt, P. , D. Mitra and P. Ranjan (2009) : “International Trade and Unemployment: Theory and Cross – National Evidence”, Journal of
12. International Economics 78, pp. 32–44. Erlat, G. (2000) : “Measuring The Impact Of Trade Flows On Employment
13. In The Turkish Manufacturing Industry”, Applied Economics, Vol. 32, pp. 1169-1180.
14. Greene, W.H. (2003) : Econometric Analysis, Prentice Hall, New Jersey.
15. Gül, E. ve A. Kamacı (2012) : “Effects of International Trade on
16. Employment: A Panel Data Analysis”, Anadolu University Journal of Social Sciences, Vol. 12, No. 4, pp. 23-32. Günlük-Şenesen, G. (1998) : “An Input-Output Analysis Employment
17. Structure in Turkey: 1973-1990”, Working Paper 9809, Economic
18. Research Forum Conference for Arab Countries, Iran and Turkey. Cairo: ERF. Hadri, K. (2000), “Testing for stationarity in heterogeneous panel data”,
19. Econometrics Journal, Volume 3, (2), pp.148–161. Hill, R.Carter, William H. Griffiths and Guay C. Lim (2011) : Principles of Econometrics, Fourth Edition, John Wiley & Sons.
20. Im, K.S. , M.H. Pesaran and Y. Shin (2003) : “Testing for unit roots in heterogeneous panels”, Journal of Econometrics, Volume 115, (1), pp. 53–
21. Krugman, P. and R. Lawrence (1993) : “Trade, jobs and wages”, NBER
22. Working Paper No : 4478, pp. 1-31.
23. Larre, B (1995) : “The Impact of Trade on Labour Markets: An Analysis
24. By Industry”, OECD Jobs Study Working Papers, No. 6, OECD, Paris, pp. 1-35. Lawrence, R.Z. (2000) : “Does a kick in the pants get you going or does it just hurt? The impact of international competition on technological change in
25. US manufacturing”, in The Impact of International Trade on Wages, (Ed.) R. C. Feenstra, University of Chicago Press, Chicago, pp. 197–224. Lawrence, R.Z. and M. J. Slaughter (1993) : “Trade and U.S. Wages: Giant
26. Sucking Sound or Small Hiccup?” Brookings Paper s on Economic Activity, Microeconomics, 2, pp. 161-210. Levin, A.T. , C.F. Lin and C. J. Chu (2002) : “Unit root tests in panel data:
27. Asymptotic and finite- sample properties”, Journal of Econometrics, Volume 108, (1), pp. 1–24. Meschi, E., E. Taymaz and M. Vivarelli (2008) : “Trade Openness and the Demand for Skills: Evidence from Turkish Microdata”, IZA Discussion Paper, No. 3887, pp. 1-29.
28. Meschi, E., E. Taymaz and M. Vivarelli (2010) : “Trade, Techonology And Skills: Evidence From Turkish Microdata”, Universita’ Cattolica Del
29. Sacro Cuore, DISCE Working Paper, N. 62, pp. 1-36. Neven, D. and C. Wyplosz (1999) : “Relative prices, trade and restructuring in European industry”, in Trade and Jobs in Europe. Much Ado
30. About Nothing? (Eds) M. Dewatripont, A. Sapir, and K. Sekkat, Oxford University Press, Oxford, pp. 33–59. OECD Structural Analysis (STAN) Databases. stats.oecd.org/ Revenga, A. (1992) : “Exporting jobs? The impact of import competition on employment and wages in US manufacturing”, Quarterly Journal of Economics, Vol. 107, No. 1, pp. 255–84.
31. Revenga, A. (1995) : “Employment and Wage Effects of Trade
32. Liberalization: The Case of Mexican Manufacturing”, World Bank, Policy Research Working Paper, No. 1524, pp. 1-36.
33. Sachs, J. D. and H. J. Shatz (1994) : “Trade and Jobs in U.S. Manufacturing”,
34. Brookings Paper s on Economic Activity, 1, pp. 1-84. Tatoğlu, Ferda Y. (2012) : Panel Veri Ekonometrisi, Beta yayınları.
35. Tatoğlu, Ferda Y. (2012) : İleri Panel Veri Analizi, Beta yayınları.
36. Turco, A. L. and M. Daniela (2012) : Does Trade Foster Employment
37. Growth in Emerging Markets? Evidence from Turkey”, Universita Politecnica Dellemarche, Quaderni Dı Rıcercia n. 383, pp. 1-25. Turkish Patent Institute. www.turkpatent.gov.tr Turkish Statistical Institute Statistics and Databases. www.turkstat.gov.tr Turkish Statistical Institute Annual Manufacturing Industry Statistics, 2001.
38. Turkish Statistical Institute Statistical Indicators 1923-2011.
39. Varian, H. R. (1984) : Microeconomic Analysis, Norton, New York.
40. Yanıkkaya, Halit (2008) : “Is Trade Liberalization A Solution To The Unemployment Problem”, Turkish Economic Association, Discussion Paper, pp. 1-32. APPENDIX
41. DESCRIPTIVE STATISTICS FOR THE SECTORS IN THE MANUFACTURING INDUSTRY OF TURKEY (NACE REV.2 CLASSIFICATION) Manufacture of food products and beverages YEARS (2003-2010) MEAN MIN. MAX. STANDARD DEVIATION 36164 479,69
42. Manufacture of tobacco products YEARS (2003-2010) MEAN MIN. MAX. STANDARD DEVIATION 5017
43. Manufacture of textiles 80044.591 9271.763
44. Manufacture of wearing apparel 5686.620 0466.156 2975.451 3336.074 1443.957
45. Manufacture of leather and related products 22651 65870 -8881.499 -3775.227 788,83
46. Manufacture of wood and of products of wood and cork, except furniture