Effects of non - tariff measures on foreign trade: An application on Turkish textile industry

Countries that are defending the protectionist approach in the international trade were using custom tariffs. However, the supporting countries of the free trade have started to argue that these measures should be revoked by the developments in the 20th centrury and globalism. Countries have started to lower the tariff measures, since the instutituons like GATT and WTO have become important actors in the international trade. A new protectionist approach has been developed by these countries in order to protect their interest in the domestic markets as well as international markets when the tariff measures were lowered. These restraining measures of the new protectionist approach are called non-tariff measures. Safeguard measures, circumvention measures, anti-dumping, and import quotas are applied as non-tariff measures in Turkish textile imports. In this thesis, the non-tariff measures are analyzed to understand whether there is a restrictive impact on the Turkish textile industry in the globalised world. Accordingly, a panel data set is generated from the Turkey's highest 20 import relations between 2005 and 2013 and gravity model is applied. Estimated results by one way fixed effects of the gravity model reveals that non-tariff measures known as restrictive are not effective international trade tools in Turkey's textile imports. Out of the non-tariff measures, only import quotas have a negative impact while the the others do not have any impact. Besides the import quotas, GDP per capita, distance to Turkey, custom tariffs, membership to WTO, and inflation levels in Turkey have impacts on the Turkish textile imports.