Browsing by Subject "total factor productivity"

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Open Access
Explaining disaggregated trade data with ricardian trade model
(2015) Korkmaz, Halil İbrahim
The aim of this thesis is to explain how disaggregated-product level trade data fits into Eaton and Kortum (2002) type Ricardian trade model. In their paper, Eaton and Kortum (2002) explain the effect of geographical barriers and technological differences on trade between countries using data at aggregate level. Their model with perfect competition and constant marginal costs actually implies that the countries who have the lowest cost in supplying a particular good to a particular destination should capture the entire demand for that good in that destination. However, this is not what is observed in disaggregated bilateral trade data even in the least aggregated level. In this thesis, we propose alternative explanations such as capacity constraints and increasing marginal costs to reconcile Eaton and Kortum (2002) setup with disaggregated bilateral trade data. Our aim is to investigate why one seller is not able to win the entire market. The results suggest that costs are not increasing with trade quantities thus constant marginal costs is still possible. To explain multiple sellers for each good and the fact that each exporter sells at a different unit price. It could be the case that exporters are bounded by capacity constraints for each good in a given market. We report relative productivities of exporters at each destination where we report to a destination with a low trade cost even low productive firms can compete but for destinations with a high trade costs only most productive firms export.
Open Access
A Regional and sectoral analysis on production technology dynamics of manufacturing industries in Turkey
(2015) Korkmaz, Sümeyra
This thesis estimates regional and sectoral total factor productivity (TFP) using firm-level data on Turkish manufacturing industry over the 2003-2012 period to understand whether there is a parallelism between differences in TFP levels and differences in income per capita across regions. As propounded by Prescott (1998), TFP theory is utilized to explain international income differences in the existing literature. However, it still remains an interesting topic to study regional differences within countries and this thesis contributes to the literature with an empirical evidence from Turkey’s regions. Based on the results obtained from different estimation methods, there is a significant heterogeneity across sectors and firms in the same sector in the micro-level and this results in different average TFP levels for regions at macro-level. Our findings suggest that discrepancies in regional TFP levels are determined by technological dynamics of the industries that are dense in those regions. Thus, different sector abundance in different regions may be one of the factors for different levels of income per capita among regions.