Export performance of Turkey in the European Union market in comparison to South East Asian countries: (1990-1997)

Abstract

Turkish exporters often complain that they cannot maintain a competitive price advantage over South East Asian exporters in world markets. This thesis aims to investigate if relative geographical proximity o f Turkey to the EU market provides a compensating advantage for Turkish exporters selling to this market. In this framework, the study attempts to measure the degree of price competitiveness stemming from the relative proximity of exporters. For this purpose, export similarities between SEAs and Turkey are determined first. The importance of competitiveness on the overall export performance of each exporter is identified by using the Constant Market Share Analysis and then, the degree o f price effect on the competitiveness is found by estimating twostage homothetic demand functions. The proximity advantage o f Turkish exporters relative to SEA exporters is identified by analyzing the difference between CIF import and FOB export prices. The results indicate that Turkey has a price advantage relative to SEA countries in the product group that exhibits the highest degree of export pattern similarity to those countries.