An analysis of unequal exchange in Turkiye s international trade

ABSTRACT Purpose- In the process of globalization, international trade has increased rapidly compared to national income (Dicken, 2015). Despite the expectation that increasing trade openness will increase economic convergence according to conventional trade and growth theories (Rowthorn, Kozul-Wright, 1998), this expectation about convergence of developing countries to developed countries has not materialized (Munck, 2021). In terms of international political economy, issues such as inequality and dependency remained on the agenda (Kiely, 2012). Alternative trade and industrial policies have been marginalized (Chang, 2002). An important theory that questions the positive expectations of conventional mainstream theories is Emmanuel's theory of "unequal exchange" (Emmanuel, 1972). However, in its original form, the theory has been subjected to various criticisms and tried to be developed. In response to the criticism that the theory is based on price and wage differences (Subasat, 2013), an approach based on international technical/organic composition and productivity differences in a more structural manner has been developed (Carchedi and Roberts, 2021). The aim of this study is to review Turkey's trade relations and point out some problems using this new approach. As the first study to apply this new approach to Turkey to our knowledge, it differs from previous unequal exchange studies (Somel, 2003; Dağıstan, 2015). Methodology- The data subject to the analysis in the study were obtained by following the methodology applied in the study of Carchedi and Roberts (2021). In the analysis based on Turkey's international trade, five developed countries that are important in Turkey's trade in the long-run were selected and a sample was obtained. In the study, graphical analysis and time series methods were applied as in the study of Carchedi and Roberts (2021). Findings- As a result of this study, in which five countries that are important in Turkey's long-term international trade are analyzed, the findings indicate that there are important value transfers in Turkey's trade, especially with developed countries. Changes in the terms and conditions of this transfer of value need to be examined and should be one of the crucial factors in considering trade policy. Conclusion- Discussion about trade policy usually revolve around trade balance. However, trade balance does not appear to be a sufficient criterion when evaluating trade policies because unequal exchange is a different concept than trade balance. Consideration of value transfers through unequal exchange should also be considered. In addition, the findings indicate that the level of technology has a decisive role in unequal exchange relations. Keywords: International trade, unequal exchange, globalization, technology, international political economy JEL Codes: D46, F63, F13