Özet:

Classical trade theories suggest that in order to economic growth countries must specialize in products which they have a comparative advantage and, export them. However, this suggestion of classical trade theories is partly based on the assumption that there is no uncertainty. Also, specializing in a narrow product range can render countries vulnerable to external shocks. For these reasons, some researchers recommend diversification to avoid the risks resulting from uncertainty and external shocks. From this point of view, this study mainly aims to investigate the effects of product diversification for the market on Turkey's real exports to 136 partner countries for the period from 2000 to 2017. The findings obtained from the second-generation econometric analyses that take into account cross-sectional dependence can be listed as follows: i) Tests show that cross-section dependence exists in the model, and slope coefficients are heterogeneous; ii) An increase in both diversification in Turkey's exports of goods and the real income of Turkey's trade partner countries increase the real export of Turkey, and iii) The appreciation of the bilateral real exchange rate has a negative impact on Turkey's real exports. Therefore, policymakers should design policies that encourage diversification. Besides, the monetary authority of Turkey should provide stabilization in the bilateral real exchange rate.

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