The Impact of Export Diversification on Economic Growth in The Context of Neo-Classical Growth Theory: An Empirical Analysis of Türkiye
Chapter from the book: Nas, Ş. (ed.) 2025. Foreign Trade and Macroeconomic Indicators Current Debates.

Ömer Doru
Mardin Artuklu University
Mehmet Dabakoğlu
Mardin Artuklu University

Synopsis

While classical economic theory emphasises specialisation in exports, especially in the context of developing countries, a literature has developed that a structure based on export diversification is a more effective method than specialisation in the process of economic development. Export product diversity stands out as a factor that not only increases export revenues steadily but also alleviates the negative effects of economic crises. It is also considered an important tool in the transition to a high-technology-based production process, which is necessary for developing countries to escape the middle-income trap. Although there is no consensus among the results of empirical studies on this issue, studies conducted in emerging economies provide evidence in support of the growth model based on export diversification. The aim of this study is to examine the relationship between export product diversity and economic growth in the context of the Turkish economy by using cointegration methods based on time series analysis. In this direction, in the regression model based on the neo-classical growth model, per capita income was determined as the dependent variable and the export product diversity index, gross fixed capital formation, labour force participation rate and trade openness variables were included in the model as independent variables. The results of the Johansen cointegration test confirm the existence of a long-run cointegration relationship between the variables. In addition, long-run cointegration coefficients were estimated using the FMOLS, DOLS and CCR methods. The findings of the analysis reveal that, along with export diversification and the other three independent variables also have a statistically significant effect on per capita income.

How to cite this book

Doru, Ö. & Dabakoğlu, M. (2025). The Impact of Export Diversification on Economic Growth in The Context of Neo-Classical Growth Theory: An Empirical Analysis of Türkiye. In: Nas, Ş. (ed.), Foreign Trade and Macroeconomic Indicators Current Debates. Özgür Publications. DOI: https://doi.org/10.58830/ozgur.pub677.c2829

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Published

March 24, 2025

DOI