Productivity, global value chains and cross-industry spillovers in Turkey

In nutshel

There are significant spillovers in productivity across industries in Turkey as a consequence of industries’ interconnectedness through input-output linkages.

Participation in global value chains (GVCs) plays a central role in explaining changes in productivity at the industry level: productivity rises with forward linkages – export of inputs used in the export of another country’s export to third countries – and declines with backward linkages – imported intermediates used in exports.

As a result of spillover effects, there are significant indirect effects of participation in GVCs on productivity; for example, productivity increases with forward linkages both within and across industries.