The Effects of State Aid on Export Performance: EU15 and Turkey
Journal Title: The Journal of International Scientific Researches - Year 2017, Vol 2, Issue 5
Abstract
Especially in developing countries, fundamental problems such as inadequate development of investments, investment goods and manifactoring sector, excessive foreign dependency, technological backwardness, current account deficit and inadequate savings restrain economic and social development. On the other hand, with the globalization promotion policies have become one of the most important tools which increasing competitiveness and prosperity, having more market share of countries. In accordance with this purpose, the effect of state aid for export on export performance was investigated to EU-15 and Turkey in 1996-2013 period. In this study, state aid, import of machinery and equipment, real GDP and real Export values was used as a variable for estimating the empirical relationship between state aid for export and export performance in EU-15 and Turkey. The results of the unit root test conducted to detect whether the series involve unit root or not reveal that the series are stationary in their first difference. The results of Pedroni and Kao cointegration test show state aid and export performance are cointegrated. According to the findings obtained from the Fully Modified Ordinary Least Square (FMOLS) method, state aid affects export performance statistically 1% at the level in a significant and positive way. Moreover, a unidirectional causality relationship from state aid to export performance is detected according to the error correction model. Finally, this study states that any increase in the state aid, grow up the export performance.
Authors and Affiliations
Emrullah Mete
Keywords
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- EP ID EP248852
- DOI 10.23834/isrjournal.302069
- Views 117
- Downloads 0
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