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Relative Underperformance Alla Turca

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  • Tasso Adamopoulos

    (York University)

  • Ahmet Akyol

    (York University)

Abstract

From 1960 to 2003, Turkey has underperformed relative to several Western economies, in terms of hours worked and output per hour. Our sectoral analysis illustrates two points. First, Turkey's large drop in hours is due to the fact that the substantial decline in agricultural hours has not been accompanied by a corresponding increase in nonagricultural market hours. Second, the sectoral composition of output is important for understanding Turkey's relatively weak rise in output per hour. We develop a simple model of structural transformation and home production to provide an account of Turkey's performance relative to the US and Southern Europe. We find that the evolution of exogenous differences in sectoral productivity and taxes, between Turkey and the US, as well as Southern Europe, can account quantitatively for most of Turkey's relative underperformance to these regions. (Copyright: Elsevier)

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File URL: http://dx.doi.org/10.1016/j.red.2009.02.002
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Article provided by Elsevier for the Society for Economic Dynamics in its journal Review of Economic Dynamics.

Volume (Year): 12 (2009)
Issue (Month): 4 (October)
Pages: 697-717

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Handle: RePEc:red:issued:06-158

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Keywords: Income differences; Labor input differences; Structural transformation; Taxes; Turkey;

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References

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  1. Caselli, Francesco, 2004. "Accounting for Cross-Country Income Differences," CEPR Discussion Papers 4703, C.E.P.R. Discussion Papers.
  2. Richard Rogerson, 2008. "Structural Transformation and the Deterioration of European Labor Market Outcomes," Journal of Political Economy, University of Chicago Press, vol. 116(2), pages 235-259, 04.
  3. Andres Erosa & Tatyana Koreshkova & Diego Restuccia, 2006. "On the aggregate and distributional implications of productivity differences across countries," Working Paper 06-02, Federal Reserve Bank of Richmond.
  4. Margarida Duarte & Diego Restuccia, 2009. "The Role of the Structural Transformation in Aggregate Productivity," Working Papers tecipa-348, University of Toronto, Department of Economics.
  5. Robert J. Barro & Jong-Wha Lee, 2000. "International Data on Educational Attainment Updates and Implications," NBER Working Papers 7911, National Bureau of Economic Research, Inc.
  6. A. Erinc Yeldan, 1998. "On Structural Sources of the 1994 Turkish Crisis: a CGE modelling analysis," International Review of Applied Economics, Taylor & Francis Journals, vol. 12(3), pages 397-414.
  7. Harold L. Cole & Lee E. Ohanian & Alvaro Riascos & James A. Schmitz, Jr., 2004. "Latin America in the rearview mirror," Staff Report 351, Federal Reserve Bank of Minneapolis.
  8. Ananth Seshadri & Rodolfo Manuelli, 2005. "Human Capital and the Wealth of Nations," 2005 Meeting Papers 56, Society for Economic Dynamics.
  9. Edward C. Prescott, 2002. "Prosperity and Depression: 2002 Richard T. Ely Lecture," Working Papers 618, Federal Reserve Bank of Minneapolis.
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Cited by:
  1. Mihai Macovei, 2009. "Growth and economic crises in Turkey: leaving behind a turbulent past?," European Economy - Economic Papers 386, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
  2. Margarida Duarte & Diego Restuccia, 2010. "The Role of the Structural Transformation in Aggregate Productivity," The Quarterly Journal of Economics, MIT Press, vol. 125(1), pages 129-173, February.
  3. Altug, Sumru G. & Filiztekin, Alpay & Pamuk, Sevket, 2007. "The Sources of Long-term Economic Growth for Turkey, 1880-2005," CEPR Discussion Papers 6463, C.E.P.R. Discussion Papers.

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