Discussion Paper
No. 2017-81 | October 04, 2017
Kemal Türkcan and Hülya Saygili
On the role of vertical differentiation in enhancing the survival of export flows: evidence from a developing country

Abstract

This paper analyzes the role of vertical differentiation linked with global production networks in increasing the chance of export survival using highly disaggregated machinery exports data from Turkey for the 1998–2013 period. Results obtained from the descriptive statistics analysis suggest that the duration of Turkey’s machinery exports is remarkably short with a median duration of merely one year. In addition, the likelihood of the survival of exports varies widely across total machinery, finished and parts and components as well as across trade types (horizontally and vertically differentiated products). Based on discrete-time duration models, the empirical results demonstrate that vertical differentiation together with product and market diversification are associated with a higher export survival rate, particularly for parts and components. The evidence hence supports the hypothesis that global production sharing activities greatly increase the chances of survival in export markets.

JEL Classification:

F10, F14, C41

Cite As

Kemal Türkcan and Hülya Saygili (2017). On the role of vertical differentiation in enhancing the survival of export flows: evidence from a developing country. Economics Discussion Papers, No 2017-81, Kiel Institute for the World Economy. http://www.economics-ejournal.org/economics/discussionpapers/2017-81


Comments and Questions



Anonymous - Referee report 1
November 15, 2017 - 13:31
see attached file

Kemal Türkcan and Hülya Saygili - Reply to referee report 1
November 23, 2017 - 11:37
see attached file