Analysis of the impact of bilateral and transit quotas on Turkey's international trade by road transport: An integrated maximum flow and gravity model approach

Bora Çekyay, Peral Toktaş Palut, Özgür Kabak, Füsun Ülengin, Özay Özaydın and Burç Ülengin

Research in Transportation Economics, 2017, vol. 66, issue C, 70-77

Abstract: We explore whether bilateral and transit quotas applied by EU countries on Turkey have a negative impact on Turkey's international trade by road transport. Therefore, Turkey's exports by road transport to selected European countries are analyzed in a panel-data framework for the period 2005–2014. We estimate the aggregate effect of different quota types on trade between Turkey and European countries by using an approach that integrates the max-flow and gravity models. In the gravity model, for each country, a single value representing the aggregate restricting effect of different quota types is needed. The single values are obtained by solving multiple max-flow problems, where constraining effects of different quota types are modeled as arc capacities. The results of the gravity model suggest a loss in Turkish exports by road transport because of the quotas imposed by other countries. Most of the negative impact results from bilateral quotas rather than from transit quotas, whose effect is rather marginal.

Keywords: Gravity model; Quotas; Bilateral quotas; Transit quotas; European Union; Turkey; Trade; International trade; Trade costs; Trade barriers; Maximum flow problem; Exports; Road transport (search for similar items in EconPapers)
JEL-codes: F17 L91 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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DOI: 10.1016/j.retrec.2017.04.006

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