State Capacity and the Role of Industrial Policy in Automobile Industry: a Comparative Analysis of Turkey and South Korea

Murat A. Yülek (), Kwon Hyung Lee (), Jungsuk Kim () and Donghyun Park
Additional contact information
Murat A. Yülek: Istanbul Commerce University
Kwon Hyung Lee: Korea Institute for International Economic Policy
Jungsuk Kim: Sejong University

Journal of Industry, Competition and Trade, 2020, vol. 20, issue 2, No 6, 307-331

Abstract: Abstract Automobiles account for a significant share of global output and trade. Since automobile manufacturing is widely considered to be an engine of economic development, a number of countries, including Turkey and South Korea, have pursued industrial policies in the automobile sector, with mixed success. While the two countries started from similar initial conditions and both devised and implemented automobile industrial policies, the outcomes were very different. The Korean automobile sector has far outperformed its Turkish counterpart. The difference in policy outcomes begs an obvious question of why that happened. This paper’s central objective is to find answers to that question by analyzing and comparing industrial policies in the automobile sector. To do so, we develop a list of qualitative and quantitative criteria in order to assess and explain the different outcomes. We base our analysis on a review of the historical development of the automobile sector and policies in both countries. Our analysis suggests that differences in state capacity and hence quality of industrial policies help explain the differential performance of the automobile industry in the two countries.

Keywords: State capacity; Steering capacity; Policy capacity; Industrial policy; Automotive industry (search for similar items in EconPapers)
JEL-codes: O14 O25 O38 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://link.springer.com/10.1007/s10842-019-00327-y Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jincot:v:20:y:2020:i:2:d:10.1007_s10842-019-00327-y

Ordering information: This journal article can be ordered from
http://www.springer. ... on/journal/10842/PS2

DOI: 10.1007/s10842-019-00327-y

Access Statistics for this article

Journal of Industry, Competition and Trade is currently edited by Karl Aiginger, Marcel Canoy and Michael Peneder

More articles in Journal of Industry, Competition and Trade from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().