Effects of intermediate goods imports on firm export performance and efficiency

For manufacturing firms engaged in foreign trade, in addition to constantly increasing production efficiency, increasing and sustaining export performance is of great importance. While some of these export manufacturing firms evaluate domestic resources and options for input stages in their production processes due to the necessities in the local economy or sector in which they operate or as a result of their administrative decisions, some export manufacturing firms use foreign resources and the resulting inputs. Some export manufacturing companies may prefer to use both domestic and foreign resources partially. The resource and input usage situations that occur as a result of these necessities and preferences may have intense reflections on the production and export performances of the companies. The use of intermediate goods, which have a very important role in the input-output cycle in production processes, as imported inputs can reduce production costs for companies. The quality of final products increases thanks to imported higher quality and cheaper intermediate goods. Importing intermediate goods allows domestic producers to produce in different sectors because it can create input opportunities with various characteristics. These situations allow domestic producers to develop more efficient production processes. These reflections in production increase the competitive power of companies in foreign markets by enabling them to integrate into the global value chain. Thus, the exports of firms are diversified, and an increase in foreign demand is made possible. In short, the developments in the production processes of companies with the use of imported inputs can directly affect export performance. In this study, the effects of using intermediate goods imports in the resource creation phase of foreign trade firms' production processes were tried to be determined. In the details of the study, it was examined in which direction the intermediate goods imports of the firms had consequences on production efficiency and export performance. The effects of technology intensity levels in imported intermediate goods on firm export performance and productivity levels were investigated. The number of studies in the literature examining the effects of intermediate goods imports on a micro-scale firm basis, specific to Turkish firms, is very limited. This study aims to fill this gap by analyzing the consequences of intermediate goods imports on a firm basis.