IDEAS home Printed from https://ideas.repec.org/a/bpj/rmeecf/v14y2018i1p11n3.html
   My bibliography  Save this article

Exports and Financing Constraints Evidence from Turkey

Author

Listed:
  • Gezici Armağan

    (Keene State College, Keene, NH, USA)

  • Orhangazi Özgür

    (Kadir Has University, Istanbul, Turkey)

  • Yalçın Cihan

    (Central Bank of the Republic of Turkey, Ankara, Turkey)

Abstract

This paper examines the link between financing constraints and firm exporting behavior through an in-depth study of the Turkish manufacturing firms between 1996 and 2013. Utilizing a rich firm-level data set, we test for both ex-ante and ex-post links between exports and financing constraints to tackle potential selection biases and endogeneity problems. We find a positive and statistically significant export premium for financing constraints in general. In further testing we show that there is no significant evidence of pre-entry premium, while we find that financing constraints faced by exporting firms are eased once they start exporting, confirming an improvement in the financial conditions of export starters compared to non-exporters.

Suggested Citation

  • Gezici Armağan & Orhangazi Özgür & Yalçın Cihan, 2018. "Exports and Financing Constraints Evidence from Turkey," Review of Middle East Economics and Finance, De Gruyter, vol. 14(1), pages 1-11, April.
    • Handle: RePEc:bpj:rmeecf:v:14:y:2018:i:1:p:11:n:3
    DOI: 10.1515/rmeef-2017-0024
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/rmeef-2017-0024
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.1515/rmeef-2017-0024?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kalina Manova, 2013. "Credit Constraints, Heterogeneous Firms, and International Trade," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 80(2), pages 711-744.
    2. Armando Silva, 2011. "Financial Constraints and Exports: Evidence from Portuguese Manufacturing Firms," International Journal of Business and Economic Sciences Applied Research (IJBESAR), International Hellenic University (IHU), Kavala Campus, Greece (formerly Eastern Macedonia and Thrace Institute of Technology - EMaTTech), vol. 4(3), pages 7-19, December.
    3. Altan Aldan & Mahmut Gunay, 2008. "Entry to Export Markets and Productivity: Analysis of Matched Firms in Turkey," Working Papers 0805, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
    4. Maggioni Daniela, 2012. "Learning by Exporting in Turkey: An Investigation for Existence and Channels," Global Economy Journal, De Gruyter, vol. 12(2), pages 1-20, June.
    5. Beck, Thorsten & Demirguc-Kunt, Asli & Laeven, Luc & Maksimovic, Vojislav, 2006. "The determinants of financing obstacles," Journal of International Money and Finance, Elsevier, vol. 25(6), pages 932-952, October.
    6. Greenaway, David & Guariglia, Alessandra & Kneller, Richard, 2007. "Financial factors and exporting decisions," Journal of International Economics, Elsevier, vol. 73(2), pages 377-395, November.
    7. World Bank, 2014. "Trading Up to High Income : Turkey Country Economic Memorandum," World Bank Publications - Reports 19320, The World Bank Group.
    8. Sarah Bridges & Alessandra Guariglia, 2008. "Financial Constraints, Global Engagement, And Firm Survival In The United Kingdom: Evidence From Micro Data," Scottish Journal of Political Economy, Scottish Economic Society, vol. 55(4), pages 444-464, September.
    9. Youssouf Kiendrebeogo & Alexandru Minea, 2017. "Financial Factors and Manufacturing Exports: Firm-Level Evidence From Egypt," Journal of Development Studies, Taylor & Francis Journals, vol. 53(12), pages 2197-2213, December.
    10. A. Ganesh-Kumar & K. Sen & R. Vaidya, 2001. "Outward Orientation, Investment and Finance Constraints: A Study of Indian Firms," Journal of Development Studies, Taylor & Francis Journals, vol. 37(4), pages 133-149.
    11. Ali Fakih & Pascal L. Ghazalian, 2014. "Which firms export? An empirical analysis for the manufacturing sector in the MENA region," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 41(5), pages 672-695, September.
    12. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
    13. Mahmut Yasar & Philip Garcia & Carl Nelson & Roderick Rejesus, 2007. "Is there Evidence of Learning-by-Exporting in Turkish Manufacturing Industries?," International Review of Applied Economics, Taylor & Francis Journals, vol. 21(2), pages 293-305.
    14. Yasar, Mahmut & Rejesus, Roderick M., 2005. "Exporting status and firm performance: Evidence from a matched sample," Economics Letters, Elsevier, vol. 88(3), pages 397-402, September.
    15. Steven N. Kaplan & Luigi Zingales, 1997. "Do Investment-Cash Flow Sensitivities Provide Useful Measures of Financing Constraints?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(1), pages 169-215.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Joachim Wagner, 2019. "Access to Finance and Exports – Comparable Evidence for Small and Medium Enterprises from Industry and Services in 25 European Countries," Open Economies Review, Springer, vol. 30(4), pages 739-757, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Filipe Silva & Carlos Carreira, 2011. "Financial Constraints and Exports: An Analysis of Portuguese Firms During the European Monetary Integration," Notas Económicas, Faculty of Economics, University of Coimbra, issue 34, pages 35-56, December.
    2. Peter H. Egger & Michaela Kesina, 2014. "Financial Constraints and the Extensive and Intensive Margin of Firm Exports: Panel Data Evidence from China," Review of Development Economics, Wiley Blackwell, vol. 18(4), pages 625-639, November.
    3. Filipe SIlva & Carlos Carreira, 2011. "Financial constraints and exports: An analysis of Portuguese firms during the European monetary integration," GEMF Working Papers 2011-13, GEMF, Faculty of Economics, University of Coimbra.
    4. Joachim Wagner & John P. Weche Gelübcke, 2015. "Access to finance, foreign ownership and foreign takeovers in Germany," Applied Economics, Taylor & Francis Journals, vol. 47(29), pages 3092-3112, June.
    5. repec:spo:wpecon:info:hdl:2441/9948 is not listed on IDEAS
    6. Flora Bellone & Patrick Musso & Lionel Nesta & Stefano Schiavo, 2010. "Financial Constraints and Firm Export Behaviour," The World Economy, Wiley Blackwell, vol. 33(3), pages 347-373, March.
    7. repec:hal:wpspec:info:hdl:2441/9948 is not listed on IDEAS
    8. Sandra M. Leitner & Robert Stehrer, 2013. "Access to finance and funding composition during the crisis: A firm-level analysis of Latin American countries," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 50(1), pages 1-47, May.
    9. Joachim Wagner, 2016. "Credit Constraints and Exports: A Survey of Empirical Studies Using Firm Level Data," World Scientific Book Chapters, in: Microeconometrics of International Trade, chapter 12, pages 401-421, World Scientific Publishing Co. Pte. Ltd..
    10. Başak Dalgıç & Burcu Fazlıoğlu & Deniz Karaoğlan, 2015. "Entry to foreign markets and productivity: Evidence from a matched sample of Turkish manufacturing firms," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 24(5), pages 638-659, August.
    11. Saira Qasim & Marian Rizov & Xufei Zhang, 2021. "Financial constraints and the export decision of Pakistani firms," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(3), pages 4557-4573, July.
    12. Yu, Ziliang & Tong, Jiadong, 2020. "Financing benefit from exporting: An indirect identification approach," Journal of Multinational Financial Management, Elsevier, vol. 57.
    13. Joachim Wagner & John P. Weche Geluebcke, 2013. "Credit Constraints, Foreign Ownership, and Foreign Takeovers in Germany," Working Paper Series in Economics 283, University of Lüneburg, Institute of Economics.
    14. M. Padmaja & Subash Sasidharan, 2021. "Financing constraints and exports: evidence from India," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 45(1), pages 118-145, January.
    15. Maria D. Tito & Ruoying Wang, 2017. "Exporting and Frictions in Input Markets : Evidence from Chinese Data," Finance and Economics Discussion Series 2017-077, Board of Governors of the Federal Reserve System (U.S.).
    16. Ha, Le Thanh & Dung, Hoang Phuong & Thanh, To Trung, 2023. "Bribery, global value chain decisions, and institutional constraints: Evidence from a cross-country firm-level data," International Economics, Elsevier, vol. 173(C), pages 119-142.
    17. Flora Bellone & Patrick Musso & Lionel Nesta & Stefano Schiavo, 2008. "Financial Constraints as a Barrier to Export Participation," SciencePo Working papers Main hal-01074250, HAL.
    18. José Manuel Mansilla-Fernández & Juliette Milgram-Baleix, 2023. "Working capital management, financial constraints and exports: evidence from European and US manufacturers," Empirical Economics, Springer, vol. 64(4), pages 1769-1810, April.
    19. Doan, Ngoc Thang & Vu, Thi Kim Chi & Nguyen, Thi Cam Thuy & Nguyen, Thi Hong Hai & Nguyen, Kieu Trang, 2020. "Cash-in-advance, export decision and financial constraints: Evidence from cross-country firm-level data," International Review of Economics & Finance, Elsevier, vol. 69(C), pages 75-92.
    20. Schnitzer, Monika & Buch, Claudia & Kesternich, Iris & Lipponer, Alexander, 2010. "Exports Versus FDI Revisited: Does Finance Matter?," CEPR Discussion Papers 7839, C.E.P.R. Discussion Papers.
    21. Nakhoda, Aadil, 2012. "The influence of financial leverage of firms on their international trading activities," MPRA Paper 35765, University Library of Munich, Germany.
    22. Juan A. Máñez Castillejo & Oscar Vicente-Chirivella, 2019. "Exports of Spanish manufacturing firms and financial constraints," Working Papers 1921, Department of Applied Economics II, Universidad de Valencia.

    More about this item

    Keywords

    financing constraint; international trade; exports; Turkey; propensity score matching;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:rmeecf:v:14:y:2018:i:1:p:11:n:3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.