Decomposition of total public and private output growth of manufacturing sectors of Turkey between 1970 and 1991

Abstract

The output growth of the Turkish manufacturing industries are decomposed into three, the change in technical efficiency, change in technological progress and increased input usage between 1970 and 1991. There are various methods to decompose the output growth into two groups, which are the share of productivity and that of change in input usage. The method used in this thesis, in addition, enables one to differentiate the technical efficiency from the technological progress. The results of the decomposition are analyzed in relation with the major macroeconomic variables o f the Turkish economy such as exports, imports and investments. Within this period, special emphasis is given to the years of 1980 balance of payment crisis and the following stabilization program. Furthermore, the decomposition is repeated for the public and private manufacturing industries separately. The contribution o f technological progress to output growth, was observed to be dominated by the contributions of the other two components, for both the public and the private sectors.