The Relationship Between Trade Openness, Foreign Trade Tax Revenues and GDP in Turkey: ARDL Bounds Test Approach for 1993-2019 Period

Abstract

The level of trade openness and the impact of foreign trade taxes on GDP is one of the frequently\rdiscussed topics in the literature. Especially with the globalization and economic integration movements,\ranalyzing these factors related to the foreign trade of the countries has become a subject of vital importance\rand attracting attention among researchers. However, there is no generally accepted opinion regarding the\rextent and direction of the effects of these two factors on GDP. Because the level of trade openness (export +\rimport) and the size of the foreign trade tax revenues vary from country to country. This study examined\runder the influence of Turkey. By determining the magnitude and direction of this effect in Turkey, the study\ris intended to contribute to the literature, decisions related to foreign trade and future researchers. In this\rstudy which is conducted for the period 1993-2019, ARDL Bounds Test Method was used. As a result of the\ranalysis, a low and negative relationship was found in Turkey from foreign trade tax revenues to GDP. On\rthe other hand, a positive and meaningful relationship to GDP was determined from the level of trade\ropenness. These definitions show that additional tax obligations imposed on foreign trade in order to increase\rtax revenues in Turkey negatively affect growth, while the opening of the use of economic instruments to\rforeign investors and consumers positively affects economic growth.