Unravelling the structure of Turkish exports: Impediments and policy

In this study we reveal the structure of exports in an emerging economy, Turkey, to shed light on the impediments not only this country but also other developing countries might face in pursuit of increasing exports to tackle their current account problems. We employ panel data econometrics for estimating exports, labour and imports market specifications simultaneously to address endogeneity issues. The data covers 13 manufacturing industry sectors, 25 main export markets over the period 2000-2011. Our findings reveal that unlike conventional assumptions, export supply is not infinitely elastic, and the supply side of the market plays a critical role in reviving export earnings in Turkey.