The inward processing regime across Turkey and in particular gaziantep: Bound test analysis

For many countries that follow the export-based industrialization strategy, the impact of export on the country's economy depends largely on the feature of export goods. Namely, it is known that exports will not create a positive effect on the economic growth in the long-term if the export goods mostly include the raw materials instead of the end product. At this point, inward processing regime comes to the forefront as the most effective foreign trade regime in terms of allowing added value creation. Based on these informations, the main objective of this study is to examine the impact of the export transactions made under the inward processing regime on the economic growth in Turkey. In addition, the other aim of the study aspect of is to investigate the contributions of export transactions made under inward processing regime from Gaziantep to Turkey's economy. In through this, first, the role of Gaziantep on export performance of Turkey is investigated with descriptive statistics. Then, the empirical model that based on the Cobb-Douglas function is constructed in order to compare the effects of the export within the inward processing regime and exports transactions of the other regimes on the economic growth. In this model, the data set covering the observation of 2002-2017 is examined by ARDL bound test. In the study, it is concluded that the export transactions covered by the export processing regime are more efficient than the other export transactions on the economic performance of Turkey.