Business, ethics and institutions the evolution of Turkish capitalism in a comparative perspective

Abstract

This chapter provides a broad overview of the distinctive features of Turkish business history over the last century and a half. The country missed out on the first wave of modern industrialization during the Ottoman era, and developed in a skewed way, with minority religious and ethnic groups dominating business. The establishment of the Republic of Turkey in 1923 was accompanied by the eventual elimination of entrepreneurial minority groups. Although favoring Muslims, the government pursued a nationalistic and secular agenda. Turkish business grew in an insular fashion, largely unable to develop strong international competitive advantages. The last three decades saw the country’s long-established business groups experience new challengers from the provincial towns of Anatolia, which were characterized by religious beliefs and links to political Islam. Anatolian capitalism became a source of renewal and growth for the Turkish economy, albeit one in which persistent problems of corruption and rent-seeking appeared in new forms.