DETERMINANTS OF EXPORT PRODUCT QUALITY: THE PANEL DATA ANAYSIS ON DEVELOP AND DEVELOPING COUNTRIES

Abstract

Author(s): Osman DE?ER, H羹seyin KALEL?

Developed countries have a comparative advantage in some products compared to other countries for years and have gone to specialization in the production of these products. Developed countries have started to focus on the quality and diversity of these products after specializing in these products. This increase in the quality of the products has produced many economic consequences. While developed countries produce products with more technological intensity in their production, developing and less developed countries produce products produced using less technology with the more primitive production method. Higher quality products produced in developed countries are exported to countries with higher income levels, while products produced in developing and less developed countries are exported to countries with lower income levels. From this point of view, the increase in the quality of the exported products means that the countries will gain more income. Developed countries aim to maintain and increase the quality of the products they export, while developing countries aim to produce higher quality products. The aim of this study is to investigate the determinants of export product quality using data from developed and developing countries. Data from 34 developed and 62 developing countries were used as a sample. Data between 1995 and 2014 were used in the study. In the study using Prais-Winston analysis, which is one of the panel data GMM methods, it was concluded that the Gross Domestic Product, human capital and foreign direct investment data positively affect the export product quality.

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