Scale economies: Interaction with facts of globalization and global competition power (Analysis of scale economies in Turkish car sector)

m ABSTRACT SCALE ECONOMIES; INTERACTION WITH FACTS OF GLOBALIZATION AND GLOBAL COMPETITION POWER (ANALYSIS OF SCALE ECONOMIES TN TURKISH CAR SECTOR) Çetin POLAT Department of Economics Anadolu University Social Science Institute Advisor: Prof. Dr. Necat BERBERO?LU Firms, country and the world economy have always been in a process of change. For the past 30-40 years, the changes and the developments have approximated the country economies to one another with the name of globalization. The competing environment, which the globalization has increased, has forced the companies and the countries to act in order to benefit in this global economic situation. In order to realize this, it is necessary to develop the information and the technology and to use these accordingly. Nowadays, developments, especially, in communication and transportation technologies have facilitated the companies and the countries to go beyond national markets and to reach the world markets. With this respect, making use of the opportunities they will be able to produce more and cheaper, they will be able to sell more products and more income and will be able to reach high standards of life.IV The firms and the countries, which have dominated the world economy by realizing the above mentioned points, have spread out all around the world, have had mass production, have employed thousands of people in different countries. These large scaled firms have gone beyond the gross national product of almost more than half of the countries in the world economy, and have gained billions of dollars and profit. These cases have made the concepts of competing and global competing, which determines present economic and political acts, possible. For the reasons of lack of national markets, attractiveness of foreign markets, and increasing national and global competing power, to go beyond the barriers of the markets, to accelerate technological innovations and make use of scale economies, the acts of alliance between the firms, joint ventures and take over (turn over) have increased. One of the important aims of these acts is to make use of scale economies by enlarging production scale and saving in costs. The firms and the establishments, which have increased specialization and cooperation, have used advanced production, management, marketing and technologies needed in the market, with the advantage of being big, they have used the opportunities of his country and the world production and they have become more advantageous in the market. The firms which have reached a certain scale in production will be able to minimize the average cost by producing their products cheaper. One of the important aims of alliances, take over (turn over) and joint ventures within the globalization is scale economy. This study has aimed to research if a car company in Turkish Car Sector has provided scale economies by doing comparison of production and cost in car production. According this production and cost comparison of the mentioned products, it has been observed that there has been a remarkable decrease in average production cost in the years when production increase has been realized. However, in the years when there has been a production decrease, it has been observed that has been a remarkable increase in average production cost by removing scale economies.