Trade liberalization and capacity utilization: New evidence from the Turkish rubber industry

Omer Gokcekus

Empirical Economics, 1998, vol. 23, issue 4, 571 pages

Abstract: This study empirically tests the hypothesis that trade liberalization increases capacity utilization. It calculates capacity utilization for the Turkish rubber industry by using a production theory framework. More specifically, plant-level capacity utilization levels are calculated using a Generalized Leontief cost function system. Capacity utilization levels were low but improved when the trade regime shifted from a restrictive to a more liberalized one. The size and location of plants were two significant factors which created capacity utilization differences within the industry. However, capacity utilization levels appeared to improve primarily because of trade liberalization.

Keywords: Trade; liberalization; ·; capacity; utilization; ·; Turkey (search for similar items in EconPapers)
JEL-codes: D24 F14 (search for similar items in EconPapers)
Date: 1998-12-14
Note: received: January 1996/final version received: March 1997
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Citations: View citations in EconPapers (2)

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