Firm productivity, exchange rate movements, sources of finance, and export orientation

Mustafa Caglayan*, Firat Demir

*Corresponding author for this work

    Research output: Contribution to journalArticlepeer-review

    28 Citations (SciVal)

    Abstract

    We investigate the level and volatility effects of real exchange rates on productivity growth of manufacturing firms with heterogeneous access to debt, and domestic and foreign equity markets in Turkey. We find that while volatility affects productivity growth negatively, having access to foreign or domestic equity, or debt markets does not alleviate these effects. Furthermore, foreign or publicly traded companies do not appear to perform significantly better than the rest. We detect, however, that productivity is positively related to credit market access. Additionally, we find that while export-oriented firms react positively to currency appreciations, they are hurt more from volatility. (C) 2013 Elsevier Ltd. All rights reserved.

    Original languageEnglish
    Pages (from-to)204-219
    Number of pages16
    JournalWorld Development
    Volume54
    DOIs
    Publication statusPublished - Feb 2014

    Keywords

    • productivity growth
    • exchange rate volatility
    • sources of finance
    • capital structure
    • export orientation
    • RATE VOLATILITY
    • STOCK-MARKET
    • INVESTMENT
    • GROWTH
    • UNCERTAINTY
    • PERFORMANCE
    • FOREIGN
    • IMPACT
    • TRADE
    • LIBERALIZATION

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