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The Mark-up Rates in Turkish Private Manufacturing Industry During Trade Liberalization

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  • Ozlem Onaran
  • Nurhan Yenturk

Abstract

The aim of this study is to shed light on the movements of the mark-up rate for the case of Turkey following trade liberalization. For this purpose, first the relationship between labor and non-labor costs that lies behind the movements of the mark-up rates is analyzed, and second, the effect of trade liberalization on mark-up rates is tested. The trade-off between labor and non-labor costs is analyzed based on a model, which assumes that prices are set by a mark-up over average variable costs. The paper also tests the effect of international trade on the mark-up rate and the effect of the exchange rate via its effect on competitiveness and input costs using the panel data for the sub-sectors of private manufacturing industry. The most striking result of this analysis is the absence of any strong link between foreign trade and mark-up rates.

Suggested Citation

  • Ozlem Onaran & Nurhan Yenturk, 2002. "The Mark-up Rates in Turkish Private Manufacturing Industry During Trade Liberalization," Journal of Income Distribution, Ad libros publications inc., vol. 11(3-4), pages 3-3, September.
    • Handle: RePEc:jid:journl:y:2002:v:11:i:3-4:p:3-3
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    File URL: http://jid.journals.yorku.ca/index.php/jid/article/view/1250
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    Cited by:

    1. Burak Ünveren & Seçkin Sunal, 2015. "Why is the Labor Share so Low in Turkey?," The Developing Economies, Institute of Developing Economies, vol. 53(4), pages 272-288, December.

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