BOĞAZİÇİ ÜNİVERSİTESİ
ISS/EC‐2007‐04
Cost of Labor in Manufacturing Sectors of Turkey Compared with Other
Transition Countries: Hungary, Poland, Czech Republic and Slovakia
Ahmet Faruk Aysan
Burcu Dinçsoy
ARAŞTIRMA RAPORU
RESEARCH PAPERS
Boğaziçi University Department of Economics Research Papers are of preliminary nature, circulated
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author(s).
1
Cost of Labor in Manufacturing Sectors of Turkey Compared with Other
Transition Countries: Hungary, Poland, Czech Republic and Slovakia
Abstract
This paper compares the competitiveness of Turkey in manufacturing in terms of unit labor cost with the transition
countries including Poland, Hungary, Czech Republic and Slovakia. Unlike the pure wage rate comparison, Turkey
performs better than other countries in the sample with respect to unit labor cost. Turkey has lower unit labor cost
almost in all the sectors. In addition, unit labor costs and their growth rates are examined in detail specifically for the
manufacturing sectors with rising and declining export shares in recent years.
Ahmet Faruk Aysan
Burcu Dinçsoy
Corresponding Author: Ahmet Faruk Aysan
Bogaziçi University
Department of Economics
34342 Bebek, Istanbul, Turkey
Phone: 90-212-359 76 39
Fax: 90-212-287 24 53
ahmet.aysan@boun.edu.tr
2
Cost of Labor in Manufacturing Sectors of Turkey Compared with Other
Transition Countries: Hungary, Poland, Czech Republic and Slovakia
Introduction
This paper provides a new perspective on Turkey’s international competitiveness in
manufacturing using relative unit labor costs among Hungary, Slovakia, Czech Republic and
Poland. We find that the unit labor cost of manufacturing in Turkey are about 25 %-50 % of the
unit labor cost in Hungary, 20 %-40 % of the unit labor cost in Poland, 35 %-60 % of the unit
labor cost in Slovakia and 25 %-40 % of the labor cost in Czech Republic. On the othe