Real wages, profit margins and inflation in Turkish manufacturing under post-liberalization

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Abstract:

This article reports investigations into the behaviour of gross profit margins (mark-ups) in Turkish manufacturing industries for the post-1980 liberalization period in relation to price inflation, trade liberalization (openness) and real wage costs. Panel data econometrics over 29 subsectors of Turkish manufacturing are used over the period 1980–1996. Results suggest that profit margins are positively and significantly related both to price inflation and real wage costs. However, openness is found to have very little impact on profit margins.

Document Type: Research Article

DOI: http://dx.doi.org/10.1080/00036840500217903

Affiliations: 1: The Middle East Technical University, Department of Economics 2: Bilkent University, Department of Economics, 06800, Ankara, Turkey

Publication date: September 10, 2005

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