International Journal of Business and Social Science

ISSN 2219-1933 (Print), 2219-6021 (Online) DOI: 10.30845/ijbss

The Analysis of Relationship between Turkey and Italy Foreign Trade within Intra-Industry Trade Theory Scope
Assistant Prof. Sinem Yapar Saçık, Ph. D. Candidate Ebubekir Karaçayır

The factor endowment theory, which was proposed to remedy the deficiencies of the theory of comparative advantages that is accepted as the base of international trade theories, had started to be inadequate in explaining the causes in the international trade. Therefore, new theories for international trade were proposed since 1960s, and one of those theories –the intra-industry trade theory made significant impacts. The aim of this study is to show if the intra-industry trade between Turkey and European Union exists between Turkey and Italy in specific, or not. Italy-Turkey foreign trade data for the period between 1993 and 2014 will be analyzed and it will be measured using Grubel-Lloyd index if the trade between the two countries is inter-industry or intra-industry. The result to be obtained will enable devising a policy suggestion in regards to the future pathway of the foreign trade between the two countries.

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