A brand choice model based on house-hold panel data: An empirical model of CSD choice in Turkey

Tüketici panelleri günümüzde gerek pazarlama yöneticileri gerekse marka tercih modelleri üzerinde çalışan akademisyenler tarafından yaygın olarak başvurulan bir veri kaynağı haline gelmiştir. Gelişmiş ülkelerde genellikle tarayıcı teknolojilerine dayalı olarak toplanan tüketim paneli verisi gelişmekte olan ülkelerde günlük tutma yöntemiyle elde edilmektedir. Bu yöntemle toplanan hane paneli verilerinin kapsam ve güvenilirliğinin tarayıcı teknolojisiyle elde edilen verilere göre daha sınırlı olduğu kabul edilmektedir. Bu çalışmanın amacı, alışveriş günlüğüne dayalı tüketici paneli verisiyle Türkiye’de, hızlı tüketim malları sektöründe, başarılı bir marka tercih modeli kurabilmenin mümkün olup olmadığını araştırmaktır. Bu amaçla, öncelikle, günlük tutma yöntemine dayalı panellerde doğrudan ulaşmanın mümkün olmadığı rakip markalara ait fiyat bilgilerini üretmeye yönelik dört aşamalı bir yöntem önerilmiştir. Daha sonra, Türkiye’de 2004 yılında 1632 hane tarafından yapılmış 26031 kolalı içecek alışverişinden yararlanılarak çeşitli çoklu probit ve lojit modelleri kurulmuş; modellerden elde edilen bulgular rassal olarak belirlenen 408 hanelik test örneklemine ait 6686 alışveriş gözlemi üzerinde sınanmıştır. Sonuçlar göreli fiyatlar, hane büyüklüğü, toplam harcama, bir önceki tercih ve sosyo-ekonomik statü açıklayıcı değişkenlerinin yüksek güven düzeylerinde anlamlı olduğunu ve kurulan modellerin gerek test gerekse model örneklemlerindeki hanelerin marka tercihlerini başarıyla tahmin ettiğini göstermektedir. Yapılan marjinal etki analizlerine seçilen modellerin verdiği tepkiler de teorik beklentilerle hassas bir uyum içindedir. Bu çalışma, Türkiye’de hane paneli verisi ile tüketicilerin bir sektördeki marka tercihlerini modellemeyi hedefleyen öncü çalışmalardan biri olması bakımından önem taşımaktadır. Anahtar Kelimeler: Tüketim paneli, marka tercih modeli, çoklu probit, Hızlı Tüketim Malları, alışveriş günlüğü.One of the major sources of consumer level brand consumption data in Fast Moving Consumer Goods (FMCG) sector is the household consumer panels maintained by individual organizations. Consumer panels are capable of keeping histories of purchases for a sample of households. Household panel data is collected via barcode scanner technologies in the developed countries. Data collected by the optical scanning of Universal Product Code permits researchers study the effects of marketing variables on customer choice among product alternatives since the mid-1980s and many dozens of papers are published on brand and retailer choice issues since then. Employing scanner technology, panel organizations does not require its members to record all the items they purchase in a shopping trip, as their panel ID cards are scanned during the payment process at checkout. Building cooperation with the retailer companies, scanner panels are able to provide price and promotion data for all the products (in a given product category) without the necessity of being purchased. On the other hand, due to the high levels of technology costs, the household level panel information in developing markets is primarily gathered using the diary mode. It is believed that, in this mode of data collection, both the reliability and the scope of information collected from the panellists are still scarce compared to their scanner type counterparts in more developed markets. One of the important problems of diary mode data is the lack of complete price information. In diary mode panel organizations, households only record the prices of the products they purchase. As it is impossible for a shopper to list the prices of all the products in the product categories (of which the shopping basket includes an item), diary mode household panels are not capable of conducting complete price data in a given product category. As the brand choice models literature using household panel data mostly stands upon the unit prices of the products purchased and their alternatives displayed on shelves, there is a gap of modelling research in the developing markets in which consumer panel measurements are made based on diary mode. The purpose of this study is to investigate whether it is possible to establish an efficient brand choice model based on diary mode household panel data from the Turkish carbonated soft drinks market.  In order to accomplish this goal, firstly, a four staged method of price data generating is suggested. Suggested method basically generates artificial unit prices for the products which are present at the retailer during the shopping trip but not purchased. Secondly, employing this price data, different multinomial probit and logit models of brand choice are built based on 26031 purchase occasions of a model sample of 1632 households. Using relevant goodness of fit and specification tests (mostly depending on the number of choices that were made correctly), the performances of these six models are tested on the 6686 purchases of a randomly selected test sample of 408 households. The results show high significance for the explanatory variables of brand loyalty (previous brand purchased), relative prices and household specific features such as total/per capita FMCG spending, household size and socio-economical status. While the coefficients have expected signs, the models predict the share of purchases remarkably well in both the model and the test samples. All of the models are capable of predicting more than three thirds of the brand choices correctly. However, Hausman tests reveal that the Independence of Irrelevant Alternatives criteria does not hold for the multinomial logit models. Therefore, theoretically, it is not possible to use the multinomial logit method in modelling the Turkish carbonated soft drinks market, although it was useful in variable selection process.  Hopefully, the goodness of fit measures and specification tests show that, there is no theoretical problem for the multinomial probit models of brand choice built in this study. Moreover, the reactions of the probit models to the marginal effect analyses are consistent with the theoretical expectations and the models are capable of predicting the monthly shares of purchases with the error range of 3% successfully. Employing diary based consumer panel data, this study is one of the pioneering attempts to integrate the consumption level data and consumer features towards developing a brand choice model in Turkey. Keywords: Consumer panel, brand choice model, multinomial probit, Fast Moving Consumer Goods (FMCG), diary mode panel data

Tüketici temelli marka değerinin finansal performans üzerine etkisi

Gerçekleştirilen çalışmada önemi artan (tüketici temelli) marka değeri konusu ve finansal performans üzerine etkileri incelenmiştir. Tüketici gözünde oluşan marka değerinin alt boyutlarıyla ortaya konularak, bu boyutların şirkete somut finansal katkıları olup olmadığı ve katkı şekilleri Türkiye menşeli firmalar için analiz edilmiştir. Yöntem olarak çalışma, Türkiye’de tüketici temelli marka değerinin (brand equity) bir anket çalışmasından elde edilecek veriler ile belirlenmesi, firmaların finansal performansının halka açık finansal tablolardan elde edilmesi ve bu iki veri grubu arasında istatistiksel olarak anlamlı bir ilişki bulunup bulunmadığının detaylı olarak analizi ve yorumlanması şeklindedir. Tüketici temelli firma gücünün (değerinin) ölçümünde pazarlama literatüründe genel kabul gören Aaker (1991)’in önerdiği boyutlar üzerine geliştirilen çok boyutlu bir model kullanılmıştır. Aaker’in önerdiği ve çalışma içerisinde kullanılan boyutlar marka farkındalığı, algılanan kalite, marka sadakati ve marka çağrışımları olarak sıralanabilir. Bu boyutların ölçümü için geçtiğimiz yıllar içerisinde uluslararası literatürde yer alan çalışmalarda kullanılarak geçerliliği test edilmiş ölçeklerden faydalanılmıştır. Bu ölçeklerde yer alan ölçüm soruları Türkçe’ye ve Türkiye şartlarına uyarlanarak, uzman görüşleri ve pilot çalışma doğrultusunda yapılan ekleme ve değişiklikler sonucunda nihai haline getirilmiştir. Firmaların finansal performanslarının karşılaştırılabilmesi için uluslararası kabul görmüş çeşitli finansal performans göstergelerinden faydalanılmıştır. Finansal performans göstergelerinin her bir firma için değerini hesap etmekte İstanbul Menkul Kıymetler Borsası vasıtasıyla elde edilen halka açık finansal tablolar kullanılmıştır. Anahtar Kelimeler: Tüketici temelli marka değeri, marka ederi, marka sermayesi, finansal performans.This study analyzes the brand and brand equity concepts and the financial performance that is expected to be improved as a result of branding activities and brand equity. This study is carried out to understand whether the consumer based brand equity affect the firms' financial performance and the degree and type of the relationship between these if there is a significant correlation is available.In the analysis stage, the consumer based brand equity's dimensions are revealed for companies from different business sectors in Turkey and these are compared with the financial performance indicators to understand whether a statistically significant relation is visible. The methodology used may be summarized as follows: the determination of the consumer based brand equity for each firm in the study by a field study (questionnaire), the acquirement of the financial data from Istanbul Stock Exchange, calculation of related variables and factors, the detailed analysis of the consumer based data and financial data together to understand the relationships between them and finally the interpretation of the results.The model used in the determination and measurement of the consumer based brand equity in this study is fundamentally based on the model proposed by Aaker (1991) and the scale developed by Yoo and Donthu (2001). The consumer based brand equity dimensions proposed by Aaker are; "Brand awareness", "Perceived quality", "Brand loyalty", and "Brand associations". The data needed for comparing the consumer based brand equity dimensions among the firms are obtained using a questionnaire, which is applied with face-to-face interview in Istanbul to 505 subjects. The scale used for measuring these dimensions is based on popular and verified scales referenced in international literature. The questions in the mentioned scales (Yoo and Donthu, 2001; Bruner and Hensel, 2001; Bearden and Netemeyer, 1999) are translated to Turkish and are modified to give the same meaning and feeling, moreover some questions were omitted and new ones are added in the light of a pilot study and expert opinions. The companies and brand that are included in this study are selected using the following criteria: publicly listed companies (to be able to have audited and comparable financial performance data), companies with a family brand (to be able to use the firm's financial data as the brand's data), not operating in the financial services sector (as the performance indicators are different in this sector). A total of 28 firms are included in the study. The questionnaire is structured to include; brand experience, category knowledge, consumer based brand equity dimensions (perceived quality, brand awareness, brand associations and brand loyalty), attitude towards brand, purchase intention, demographical and socio-economic-status questions. The internationally accepted financial ratios used in the study for comparison of financial performance between the firms may be listed as: Annual return on shares, Firm Value / Market Value, Price / Earnings, Price / Net Sales per share, EBITDA / Net Sales, Return on Assets, Operational Profit, Net Sales, Market Value, Financial Leverage Ratio, Current Ratio, and Annual Change in Net Sales. The balance sheets, income statements and related annotations that are publicly available through the Istanbul Stock Exchange for years 2007 and 2006 are used as data in calculating the aforementioned financial performance measures for the companies included in the study. The data obtained through questionnaires and from publicly available financials are processed and analyzed. An explanatory factor analysis is carried out to derive the brand equity dimensions from the questionnaire. Three different factors are obtained as a result of the factor analysis. These three factors of the brand equity are then used as the independent variables in the regression analysis with the financial performance measures, which are entered as dependent variables. As an outcome of the statistical analysis conducted, it has been seen that the consumer based brand equity positively affects most of the financial performance indicators to varying extents. Keywords: Consumer based brand equity, financial performance

Senaryo analizi için dinamik bir yaklaşım önerisi

This paper proposes a dynamic scenario analysis approach in order to understand the uncertainties about the future.  The development of alternative futures/scenarios is an important part of strategy making. This paper's objective is to propose an improved scenario analysis model based on Powell's scenario analysis approach, namely, EFAR (Extended Field Anomaly Relaxation) (Powell, 1997). This improved model is referred as REFAR (Revised EFAR) hereinafter and is expected to provide a useful guide both in public and private organizations, during their scenario planning activities. REFAR aims to eliminate the basic drawbacks of EFAR and improve its efficiency by the help of cognitive maps and artificial neural networks. In the application part of the research, REFAR is applied to Turkey's inflation analysis. Initially the probable scenarios are built, and the transitions between them are analysed. The basic scenarios finally reached through REFAR, the transition among each key scenarios as well as among the scenarios grouped under each key scenario are explained in detail. The scenarios within each key scenario clusters provide a detailed picture of all the possible futures that may be encountered. Using them, it is also possible to see the possible transition and the resulting changes that will occur within the other scenarios in the same key cluster and in the scenarios of other clusters that the scenario of interest is in direct relation with. Keywords: Cognitive mapping, neural networks, scenarios.Bu çalışmada, gelecekteki belirsizlikleri anlamaya yönelik olarak kullanılan senaryo analizi için dinamik bir yaklaşım önerilmektedir. Powell (1997) tarafından ortaya konan EFAR (Durum Bozukluklarının Giderilmesine Yönelik Bir Yaklaşım / Extended Field Anomaly Relaxation) modeli; senaryo analizine dinamik bir yapı kazandırmıştır. Ancak bazı zayıf yönleri mevcuttur ve geliştirilmeye açıktır. Bu amaçla, bu çalışmada EFAR yaklaşımındaki zayıf yönleri gidermeyi ve böylece onu, daha etkinleştirmeyi hedefleyen yeni bir model: REFAR (Düzeltilmiş / Revised EFAR) modeli önerilmektedir. Bu doğrultuda bilişsel haritalar ve yapay sinir ağlarından yararlanılmıştır. Uygulamada REFAR modeli aracılığıyla, Türkiye’de enflasyon konusunda karar vericilere destek olabilecek nitelikte dinamik bir senaryo analiz yapısı oluşturulmuştur. Anahtar Kelimeler: Bilişsel haritalar, senaryolar, yapay sinir ağları

Valuing information technologies investments with real options

Karar vericiler, bilişim teknolojileri (BT) yatırımlarını değerlerken risk ve belirsizlikle başa çıkmak zorundadırlar. Net Bugünkü Değer ve İç Verim Oranı gibi klasik değerleme tekniklerinin risk ve belirsizliği değerleme sürecine katmadaki yetersizlikleri yöneticileri karar aşamasında sıklıkla içgüdülerini kullanma zorunluluğunda bırakmaktadır. Reel opsiyonlar yaklaşımı bir yatırımın bünyesinde barındırdığı risk ve belirsizliği değerleme sürecine katan alternatif bir tekniktir. Bu makalede erteleme esnekliğine sahip gerçek bir BT yatırımı reel opsiyonlar yaklaşımıyla incelenmiştir. Bu amaçla standart Black-Scholes modeli üzerinde bazı düzenlemelere gidilerek, riskten kaçınan yatırımcıların beklentilerini dikkate alabilecek ve aynı zamanda, Black yaklaşımıyla, erken uygulanma özelliğine sahip Amerikan tipi opsiyonlar için kullanılabilecek, Microsoft® Excel tabanlı bir matematiksel model oluşturulmuştur. Sunulan model, bir e-ticaret şirketinin önündeki modernizasyon projesinin değerlemesinde kullanılmıştır. Önerilen otomasyon, gerek nakit akışlarını gerekse de ana ekonomik faktörleri dikkate alarak, karar vericiye etkin ve esnek bir çözüm sunmaktadır. Ortaya konan kapsamlı yol haritası model parametreleri cinsinden hassasiyet analizi sunmakta ve parametreler arası bağlantıları ortaya koymaktadır. Çalışmanın neticesinde, negatif NBD’e sahip bir BT projesinin bile bünyesinde barındırdığı potansiyel değerlerle bağlı olarak karlı bir yatırıma dönüşebileceği görülmüştür. Anahtar Kelimeler: BT yatırımları, BT yatırımlarının değerlemesi, BT yatırım riskleri, opsiyon değerleme modelleri, reel opsiyonlar, risk yönetimi.Decision makers, while evaluating information technology (IT) investments, have to cope with risk and uncertainty. The insufficiency of traditional valuation techniques like Net Present Value and Internal Rate of Return, in counting risk and uncertainty to valuation process, forces executives often to rely on their instincts when taking final decisions. There are two widely used methods for the evaluation of capital budgeting decisions, namely Net Present Value (NPV) and Decision Analysis (DA). NPV does not take into account managerial flexibility because it makes implicit assumptions concerning an expected scenario of cash flows and presumes decision makers' passive commitment to a certain operating strategy. NPV is constrained to pre-committing today to a go or no-go decision. It uses information only available today. Therefore, NPV systematically understates projects that include future decisions stages, where management's ability to adapt and revise later decisions introduces asymmetries in the distribution of a project's cash flows. The ability of management to abandon, grow, defer and/or scale up or down a project, introduces an element of flexibility in the system that may act as protection on the downside of uncertainty, while exploiting the benefits from the upside potential. By assuming one cash flow scenario from the beginning, NPV rules out the possibility of these adaptations and therefore, does not take into account the value creation of flexibility. DA is a useful tool for strategic decision-making because it accounts for uncertainty and managerial flexibility. DA allows management to structure the decision problem by mapping hierarchically all the feasible consequences contingent on possible scenario. DA differs from NPV in that it does not only base its decisions on information available today, but assumes that new information will be acquired as the project evolves and this information may even change the optimal choice for the project. Though DA addresses some of the fallbacks observed in traditional valuation methods, its wide spread application in practice is limited because determining the appropriate discount rate is still subject to question and solving the model is analytically cumbersome if all the possible outcomes are embedded inside the model. Nowadays, researchers are convinced that investment models require strategic and financial considerations to be reconciled and integrated. Recognizing the shortcomings of NPV and DA techniques, real options analysis has been suggested as an alternative approach that considers the risks inherent in an investment while recognizing the ability of corporations to defer an investment until a later period with the expectation of better market conditions. With the advancements in options theory and the enhancement in the valuation of a wide range of complex options, the valuation of real-life option cases are getting attainable. This paper introduces a real-life application to the valuation of IT investment projects with deferral flexibility by means of option pricing theory. For this purpose a mathematical model is developed through modifying standard Black and Scholes model that can handle the early exercise feature of American type options via Black approximation and also considers the expectations of the risk-averse investors. The presented model is applied to evaluate an investment opportunity targeting the modernization of the web based sales channel of an e-commerce company. A computer based analysis tool is developed for this purpose. Suggested automation framework provides to the decision maker an efficient and flexible solution, while taking into account all possible cash flows and also major economical factors, to deal with possible different future market scenario. This illustrative road map gives a comprehensive sensitivity analysis in terms of model parameters and exposes their interactions. Further investigations showed that even an IT project with negative NPV, when taking into account strategical formations of market conditions, can turn to a profitable occasion. Keywords: IT investments, IT investment evaluation, IT investment risk, option-pricing models, real options, risk management

Bankacılıkta operasyonel risk ölçüm modellerinin Türk bankacılık sektöründe faaliyet gösteren bir bankaya uygulanması

The risks that the banks incur are known as credit and market risks. However in recent years by the occurance of financial crises resulting from the complexity of the developments in the financial products and services; the banking sectors realised the reality of operational risks. Operational risk is basicly defined as all the risks other than credit and market risks. However in recent years the definitions for operational risk is updated. The Basel Committee's definition for operational risk is "the loss resulting from inadequate or failed internal processes, people, systems or from external events". In accordance with the Committee's definition the factors resulting operational risk are grouped in four as human, system, processes and external factors. By the official announcement of Basel II in June 2004, measuring and managing operational risk and including in the banks'capital adequacy computations became one of the most popular subjects in banking sectors. In order to manage operational risks effectively, banks are first recommended to define and classify their operational risk factors. Then it will be possible to measure the effect of each factor and calculate the required capital to minimize the effect of the risk. This paper presents the factors causing operational losses and examines the approaches for calculating capital requirements of operational risk using real data of a bank from Turkish banking sector. Keywords: Operational risk, basic indicator approach, standardised approach, alternative standardised approach, advanced measurement approach.Piyasalarda sunulan ürün ve hizmetlerin gelişmesi ve daha karmaşık hale gelmesiyle ortaya çıkan finansal skandallar sonucu operasyonel riskin bankalar için önemli boyutu anlaşılmaya başlanmıştır. Operasyonel risk genel olarak kredi ve piyasa riski dışında kalan tüm riskler olarak ifade edilmiştir. Basel II düzenlemesinin Haziran 2004 tarihinde yayınlanmasıyla birlikte, bankacılıkta operasyonel risklerin ölçümü ve sermaye yeterliliği oranına dâhil edilmesi konusu daha güncel hale gelmiştir. Bu çalışma, operasyonel riskleri oluşturan faktörleri sınıflandırıp, örnekler yardımıyla açıkladıktan sonra, operasyonel risk için sermaye gereksinimi hesaplama yöntemlerinin bankalar tarafından nasıl uygulanabileceğini sektörde faaliyet gösteren bir bankanın gerçek verilerini kullanarak anlatmaktadır. Anahtar Kelimeler: Operasyonel risk, temel gösterge yaklaşımı, standart yaklaşım, alternatif standart yaklaşım, gelişmiş ölçüm yaklaşımı

Yüksek ve Değişken Enflasyonun Tahmininde Alternatif Modellerin Karşılaştırılması: Türkiye Örneği

Enflasyon tahminleri iktisadî birimlerin geleceğe yönelik davranışlarının belirlenmesi bakımından büyük önem taşır. Bu çalışmada Türkiye gibi yüksek enflasyona sahip bir ülkede, ileriye dönük enflasyon oranının kestiriminde kullanılabilecek belli başlı teorik modellerle, VAR metodolojisini kullanan zaman serisi modellerinin başarım kıyaslaması yapılmaktadır. Bu bağlamda iktisat teorisinin kısıtlarına yer veren ve teorik model olarak adlandırılan modellerin başarımları zaman serisi modellerininkine kıyasla daha yüksek çıkmıştır. Ayrıca kestirim gücü sınaması lehte sonuç veren teorik modeller ile en başarılı iki VAR modelinin 1994 krizini önceden kestirme gücü de ayrıca sınanmıştır. Para arzı ve reel gelirdeki büyüme oranlarını döviz kuru artış oranı ve faiz hadlerini birlikte içeren genel enflasyon modeli, krizi en başarılı olarak tahmin eden model olarak ortaya çıkmıştır. Bununla beraber, para arzının büyüme hızı ve döviz kurundaki değişme enflasyon dinamiğini açıklayan en önemli iki faktör olarak karşımıza çıkmaktadır.Publisher's Versio

Are road transportation investments in line with demand projections? A gravity-based analysis for Turkey

This is the post-print version of the article which has been published and is available at the link below.In this research, an integrated gravity-based model was built, and a scenario analysis was conducted to project the demand levels for routes related to the highway projects suggested in TINA-Turkey. The gravity-based model was used to perform a disaggregated analysis to estimate the demand levels that will occur on the routes which are planned to be improved in specific regions of Turkey from now until 2020. During the scenario development phase for these gravity-based models, the growth rate of Turkey's GDP, as estimated by the World Bank from now until 2017, was used as the baseline scenario. Besides, it is assumed that the gross value added (GVA) of the origin and destination regions of the selected routes will show a pattern similar to GDP growth rates. Based on the estimated GDP values, and the projected GVA growth rates, the demand for each selected route was projected and found that the demand level for some of these road projects is expected to be very low, and hence additional measures would be needed to make these investments worthwhile

How to improve the innovation level of a country? A Bayesian net approach

This study aims to provide strategic guidelines to policy makers who are developing strategies to improve their country’s innovativeness. In this paper, we claim that innovation cannot be related only to some factors inherent in the environment of a country, nor is it a single entity to be managed without any linkages to the rest of the actors comprising the competitiveness of a country. Hence, a comprehensive study on innovation should cover the interaction between competitiveness indicators and innovation. For this purpose, the innovation performance of 148 countries is analyzed using an integrated cluster analysis and a Bayesian network framework. These countries are first clustered based on the average values of their competitiveness indicators representing 12 pillars and several sub-pillars adopted from the Global Competitiveness Reports of World Economic Forum for the 2009-2012 period. As a result, five appropriate clusters emerge: Leaders, Followers, Runners Up, Developing Ones, and Laggers. A factor analysis is then conducted to reveal the main characteristics of each cluster in terms of competitiveness indicators. Subsequently, a Bayesian network is constructed and sensitivity analyses are performed to reveal important policies for each cluster

A problem-structuring model for analyzing transportation–environment relationships

This is the post-print version of the final paper published in European Journal of Operational Research. The published article is available from the link below. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. Copyright @ 2009 Elsevier B.V.This study discusses a decision support framework that guides policy makers in their strategic transportation related decisions by using multi-methodology. For this purpose, a methodology for analyzing the effects of transportation policies on environment, society, economy, and energy is proposed. In the proposed methodology, a three-stage problem structuring model is developed. Initially, experts’ opinions are structured by using a cognitive map to determine the relationships between transportation and environmental concepts. Then a structural equation model (SEM) is constructed, based on the cognitive map, to quantify the relations among external transportation and environmental factors. Finally the results of the SEM model are used to evaluate the consequences of possible policies via scenario analysis. In this paper a pilot study that covers only one module of the whole framework, namely transportation–environment interaction module, is conducted to present the applicability and usefulness of the methodology. This pilot study also reveals the impacts of transportation policies on the environment. To achieve a sustainable transportation system, the extent of the relationships between transportation and the environment must be considered. The World Development Indicators developed by the World Bank are used for this purpose

Effects of quotas on Turkish foreign trade: a gravity model

As stated by a European Union Commission Report (2009), Turkey's role as a world trade participant has grown in recent years, particularly as the country has been capitalizing more on its unique geopolitical position. Given the substantial trade volume and deep-rooted relations between Turkey and the EU, due attention should be paid to their trade and economic relations, and steps should be taken to improve these relations. Turkey is the biggest economy that is in a Customs Union (CU) with the EU, but not a member of the EU, along with Andorra, Monaco, and San Marino. When it joined the CU in 1996, Turkey removed all customs duties and equivalent charges as well as quantitative restrictions. However, some EU countries impose quota limits on Turkish road transporters that may indirectly restrict trade between Turkey and the country in question. This study has investigated the effect of road-transport quotas on Turkish foreign trade with EU countries. A gravity model estimated using panel data from 18 selected EU countries between 2005 and 2012 was used for this purpose. Furthermore, as one of the leading sectors using road transportation for Turkish exports to EU countries, the textile sector was analyzed as a case study. The results indicated that quotas have significant effects on total Turkish exports by road transport as well as Turkish textile exports to EU countries. The estimated loss of Turkish exports to the selected countries in the time period analyzed was 10.6 billion dollars of Turkey's total exports by road transport and 5.65 billion dollars of Turkey's total textile exports. Therefore, it can be concluded that the quota limitations are against CU regulations because they limit not only road transportation, but also trade between parties