Human capital and export: Panel data causality analysis on provinces in Turkey
The outward-oriented and export based growth strategies in Turkish economy has recently transformed the structure of export into technology intensive motor vehicles and equipments. It is inevitable that this structural transformation of export will affect the amount of human capital needed in export sector. In parallel fashion, human capital may affect productivity spurring export. This paper examines the relationship between human capital and export in provinces of Turkey, using the panel causality method with annual data from 1996 to 2008. Empirical findings reveal that there is a unidirectional causal relationship running from export to human capital except for 5th order developed provinces. The significance of this empirical result is that export can be considered as an effective instrument increasing human capital accumulation. Overall, the paper suggests that export triggers increases in human capital in provinces which have different level of socio-economic development.
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