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Regional TFP Disparities in Turkish Agriculture and the Role of Trade Openness

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  • Otgun, Hanifi
  • Fulginiti, Lilyan
  • Perrin, Richard

Abstract

This paper provides regional level estimates of total factor productivity (TFP) growth and its components in Turkish agriculture. Using a translog stochastic frontier model with monotonicity constraints, we decompose TFP growth into technical change and efficiency change across 26 NUTS-2 regions over 2013–2020. We also examine the relationship between technical efficiency and trade openness by integrating regional agricultural trade openness into the model as an (in)efficiency driver. These contributions address gaps in the existing literature by revealing regional TFP disparities in Türkiye and investigating the previously understudied link between technical efficiency and trade openness. Additionally, we explicitly control for climatic effects, including average temperature and precipitation in the frontier, to isolate weather-driven fluctuations from inefficiency. Our results highlight pronounced regional disparities, with export-oriented regions exhibiting higher efficiency. Moreover, trade openness is significantly and positively associated with technical efficiency, suggesting that greater integration with external markets may foster TFP growth in the Turkish agricultural sector. Climate variables show nuanced impacts, with moderate temperature and rainfall positively affecting agricultural output, while extreme conditions negatively impact yields. TFP growth is predominantly driven by technical change, while efficiency change slightly detracts from overall productivity gains.

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  • Otgun, Hanifi & Fulginiti, Lilyan & Perrin, Richard, 2025. "Regional TFP Disparities in Turkish Agriculture and the Role of Trade Openness," 2025 AAEA & WAEA Joint Annual Meeting, July 27-29, 2025, Denver, CO 361177, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea25:361177
    DOI: 10.22004/ag.econ.361177
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    1. Dani Rodrik, 1988. "Closing the Technology Gap: Does Trade Liberalization Really Help?," NBER Working Papers 2654, National Bureau of Economic Research, Inc.
    2. M. Ali AVCI & A. Aysen KAYA, 2008. "Gecis Ekonomileri ve Turk Tarim Sektorunde Etkinlik ve Toplam Faktor verimliligi Analizi (1992-2004)," Ege Academic Review, Ege University Faculty of Economics and Administrative Sciences, vol. 8(2), pages 843-860.
    3. Sotnikov, Sergey, 1998. "Evaluating the Effects of Price and Trade Liberalisation on the Technical Efficiency of Agricultural Production in a Transition Economy: The Case of Russia," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 25(3), pages 412-431.
    4. Hasan Dudu & Erol H. Cakmak & Nadir Ocal, 2015. "Drivers of Farm Efficiency in Turkey: A Stochastic Frontier Analysis," World Journal of Applied Economics, WERI-World Economic Research Institute, vol. 1(1), pages 45-63, June.
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