Academic journal article Insight Turkey

Economic Liberalization and Class Dynamics in Turkey: New Business Groups and Islamic Mobilization

Academic journal article Insight Turkey

Economic Liberalization and Class Dynamics in Turkey: New Business Groups and Islamic Mobilization

Article excerpt

Turkish society, economy, and politics have been going through fundamental changes since the country shifted from state-centered import substitution policies to economic liberalization. As of the early 1980s, the Ozal government began to promote a culture of entrepreneurship. Scholars have long examined the political and economic implications of this change. What has not been clearly analyzed, however, is how these transformations fundamentally altered the class dynamics. In this article, we argue that the growth of new capitalist classes transformed social stratification, multi-party politics and the international political orientation of the country. New business groups energized by Islam have facilitated much needed class mobility. In this process, there also emerged a confrontational split in middle class positions between Islamic versus secular political outlooks. The expansion of new middle classes fuelled economic growth, industrial diffusion to Anatolian towns, and a rapid rise in export capacity. More dramatically, these new capitalist classes redefined the allocation of markets and the distribution of assets while they expanded opportunities for their affiliated groups at home and in foreign markets.

This work should be seen as a contribution to the scholarly debate about social change and the rise of Islamic business groups through the analysis of social class and identity politics. We regard the growth of small and medium-sized enterprises (SME) and new industrial centers in Anatolia to be the engines of change in class dynamics. Although there has been much discussion about Islam in Turkish society and politics (1) and the relationship between economic liberalization and a new Islamic leaning bourgeoisie (2) there are few empirically grounded sociological studies of new industrialists and the rise of second tier industrial towns. In the following sections, we illustrate how a better analysis of the "Anatolisation of industrial capital" can help us to understand the new class dynamics and centre-periphery relations. Our analysis shows how Islamic mobilization emerges as a strategic resource in class dynamics, opportunity allocation and moral justification.

In the following sections we will examine three arguments. First, we will show why the emergence of a new generation of Anatolian capitalists and their wealth accumulation are important to understand changing class dynamics. Second, we will show how the promotion of Islamic values energized business groups and led to new political formations. Third, we will illustrate how the increasing influence of Islam has led to an identity contest and search for authenticity in class dynamics. Finally, we will explain the implications of these for foreign trade relations, as the new business classes search to expand their opportunities abroad. Our conclusion will highlight the dilemmas of the future relations between the new capitalist classes and Islamist politics.

Emergence of a Post-1980 Social Stratification

The foundations of the modern Turkish Republic rested on a top-down state tradition governed by a state recruited elite in the civil service, the army, and in politics. Centralist tendencies in governance allocated a greater role to Ankara-based institutions in all spheres of public service (such as the State Planning Organization, government ministries, the central bank and the army). The state was not only the major investor in heavy industries, energy and infrastructure, but it also managed them with an extensive administrative bureaucracy until the 1980s. Infrastructure and development investments were planned and executed centrally without seeking local participation or regional involvement. In the market, state-run enterprises were accompanied by a handful of large private business conglomerates, which controlled major sectors of the economy. (3) The majority of privately owned small businesses were localized micro enterprises. …

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