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Turkey Country Economic Memorandum : Firm Productivity and Economic Growth (English)

Turkey’s pace of income convergence has globally been one of the most remarkable of the past fifteen years. Sustaining growth and improvements in living standards in Turkey will require higher productivity in the economy. The Turkey Productivity Report (2019) provides an in-depth analysis of firm productivity in Turkey and how this adds up to economic growth in the country. The report has six parts. The first two provide macro and micro diagnosis of productivity in the economy – what are the productivity trends, how have these affected economic growth, what firms in what industry are the most productive, and are they absorbing an increasing or decreasing share of resources? From here the report analyzes specific policy areas that might explain firm productivity dynamics in Turkey – namely firms’ integration in the global economy, access to innovation support, the quality of human capital, and the business environment including competition. The report finds that economic integration and innovation have boosted firm-level productivity, though reforms could further accelerate these positive impacts. Productivity gains could accelerate the demand for more educated and skilled workers. The growth of more productive firms could in turn also be accelerated through reforms that increase competition and reduce regulatory burden.


  • Author

    Rab,Habib Nasser, Yasar,Pinar, Varela,Gonzalo J., Kouame,Auguste Tano, Mahajan,Sandeep, Francis,David C., Divanbeigi,Raian, Kilinc,Umut, Makovec,Mattia, Atas,Erdem, Polat,Beyza

  • Document Date


  • Document Type

    Country Economic Memorandum

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  • Country


  • Region

    Europe and Central Asia,

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  • Disclosure Status


  • Doc Name

    Turkey Country Economic Memorandum : Firm Productivity and Economic Growth

  • Keywords

    Manufacturing; capital to output ratio; marginal productivity of labor; labor force participation rate; information and communication technology; patent cooperation treaty; productivity growth; restrictions on trade; total factor productivity; productivity gain; tight monetary policy; reallocation of resource; within-firm productivity growth; high productivity growth; monetary policy framework; share of employment; foreign value added; net entry effect; Rule of Law; labor market rigidity; Labor market rigidities; school enrolment rate; growth and development; quality of outputs; machinery and equipment; per capita income; Construction Building; change in employment; labor intensive manufacturing; term of productivity; industry and manufacturing; impact of competition; construction of building; labor productivity growth; cost of finance; external debt burden; increase in debt; acceleration in inflation; Labor Market Flexibility; reform reform; Corporate Debt Restructuring; interest rate hike; exchange rate stability; quality of infrastructure; labor market regulation; propensity score matching; gross domestic product; free trade agreement; foreign direct investment; movement of labor; skill and technology; quality of education; lack of skill; supply of skill; standard of living; Transport and ICT; savings and investment; subsidy to employer; innovation in service; efficient resource allocation; private credit growth; Private Sector Growth; purchasing power parity; quality of public; share of export; Logistics Performance Index; fiscal policy reform; exchange rate pressures; monetary policy transparency; financial sector policy; independent central bank; medium-term expenditure framework; Public Debt Management; allocative efficiency; manufacturing sector; supply side; export market; Fiscal policies; public support; reduce trade; employment growth; employment share; macroprudential policy; debt resolution; market failure; positive impact; creative destruction; Economic Policy; macro stability; comparator country; private consumption; firm performance; productive efficiency; factor accumulation; royalty payment; manufactured goods; professional service; productivity dynamic; antidumping duty; transition matrix; living standard; labor input; antidumping measures; firm-level productivity; Macroeconomic Stability; increased integration; employment impact; high employment; financial market; productive investment; firm size; employment creation; innovation performance; absorptive capacity; increased liberalization; labor supply; public finance; largest firms; financial crisis; credit crunch; demand shock; market volatility; tradable sector; economic convergence; skill composition; fiscal adjustment; real value; policy option; supply capacity; wage increase; Macroprudential Regulation; real sector; firm innovation; International Trade; business support; service capacity; supplier development; global marketplace; transport equipment; export status; public intervention; high wage; excess supply; high school; minimum wage; behavioural science; market exit; disruptive technology; price distortion; support sme; innovation potential; business improvement; grant award; Property tax; market stability; business environment; optical equipment; standard deviation; technology adoption; Technology Diffusion; human capacity; inflation targeting; international market; ict indicator; production pattern; technological development; foreign origin; external knowledge; average productivity; exporting firms; multiple channels; foreign affiliate; productivity spillovers; basic metal; information asymmetry; electrical equipment; market distortion; scientific sector; traditional service; tax incentive; domestic saving; economic recovery; production function; credit guarantee; demographic change; employment dynamic; young population; institutional factor; macroeconomic level; hospitality services; financial system; macroeconomic performance; factor inputs



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Rab,Habib Nasser Yasar,Pinar Varela,Gonzalo J. Kouame,Auguste Tano Mahajan,Sandeep Francis,David C. Divanbeigi,Raian Kilinc,Umut Makovec,Mattia Atas,Erdem Polat,Beyza

Turkey Country Economic Memorandum : Firm Productivity and Economic Growth (English). Washington, D.C. : World Bank Group