The Nexus between Research and Development and Export Decision : The Case of Turkey

Purpose: The purpose of this paper is to present an investigation into the relationships between Research and Development (R&D) and export decisions in Turkey. We empirically test to what extent firms' R&D and export decisions are determined on the basis of firm-specific characteristics such as labour productivity, total sales, age, skill, capital intensity, foreign ownership and transfer of technology. Design/methodology/approach: Data used in this study was extracted from the World Bank's Turkey-Enterprise Survey conducted in 2013 and 2014 in a cross-section study undertaken in face-to-face interviews with the establishments. Bivariate Probit estimation is utilized. Findings: Our main findings show that learning by examining the export effect is invalid for Turkey. Additionally, as expected, government support and the transfer of technology increases the probability of a decision to export. Furthermore, both export and R&D decisions exhibits substantial differences on the basis of firm characteristics. Research limitations/implications: Our principle findings lead to the implication that Turkish government support for small firms can particularly be employed as a mechanism to cope against the obstacles posing limitations on small firms to make a decision to export. Originality/value: The novelty of this study is that it uses data extracted from one of the most recent and reliable surveys conducted by the World Bank on the behaviour of firms in Turkey