Politics Behind Good Financial Governance Institutions: Lessons from Turkey’s 1990s
Tarih: 14 Aralık 2016, Çarşamba
Yer: santralistanbul Kampüsü, E2-302
Konuşmacı: İhsan Ercan Sadi (New York Üniversitesi Sosyoloji Bölümü Doktora öğrencisi)
Çarşamba Konuşmaları İstanbul Bilgi Üniversitesi Sosyoloji Bölümü tarafından düzenlenmektedir.
Seminer dili İngilizce'dir; çeviri hizmeti sunulmayacaktır.
This paper explores the politics behind the implementation of good governance institutions, by focusing on the case of Turkey's fight against endemic banking sector corruption in the 1990s. I aim to answer two interrelated questions. First, although authorities were clearly aware of the enormous levels of corrupt banking practices in both the public and private branches of the financial sector throughout the decade, why did they choose to look away instead of taking measures that aimed at disciplining the sector? Second, what changes finally enabled the incumbent coalition government to implement structural reforms in early 2000s? I argue that, with the liberalization of capital markets in 1989, the Turkish state’s commitment to deepen financial markets via restructuring public debt--achieved by increasingly relying on short-term borrowings from private domestic markets to roll over debt as the Central Bank gradually withdrew from its role of directly financing the deficit—as well as structural vulnerabilities of Turkish economy necessitated lax regulation of the banking sector. Downright fraudulent relations between state budget and financial interests became the main engine of capital accumulation processes. Fearing a systemic collapse, Turkish authorities shied away reform attempts to implement disciplining measures in finance. Only after the 2000-2001 economic crises could such "good governance" institutions as an independent Central bank and a Banking Regulation and Supervision Agency finally be established. The combination of two factors facilitated this shift: i) the Turkish state could now get business support since the severe crisis drove most of the inefficient capitals of the banking sector which aggressively resisted reform attempts in the previous decade; ii) huge IMF loans not only increased state autonomy but also boosted the confidence of business that now felt regulatory measures advanced their interests.
İhsan Ercan Sadi:
İhsan Ercan Sadi is a PhD Candidate in the Department of Sociology at New York University. His dissertation-in-progress examines Turkish political (in)stability in the era of global capitalism, from a perspective of political economic/sociological analysis of such contemporary issues as corruption, public debt, large-scale privatization, and success (or failure) of regulatory reform processes.