Economics and Politics in Turkey

This book examines the interaction of politics and economics in Turkey. Applying the new political economy and public choice economics, it shows how politicians manipulate the economy for their own ends, for example by using fiscal and monetary policy, and by timing elections to coincide with periods of relative prosperity. It goes on to show the impact of all this on the Turkish economy, arguing that political manipulation has taken the economy from its natural course, and brought about unoptimality and disequilibrium, for example in the form of growing government expenditure, ever increasing public debt, chronic economic and political crises, and inflation. It argues that politico-economic interaction in Turkey is different from in Western democracies, and that Turkish democracy is different from Western democracy. It goes on to propose how political manipulation of the economy might be moderated, for example through increased privatisation, central bank independence, and a more robust relationship with international financial institutions. Understanding fully economics and politics in Turkey, and the interaction between them, is of critical importance as Turkey’s accession to the European Union is negotiated.

Mehmet Asutay is Lecturer in Political Economy at the University of Durham, UK. His research interests focus on political economy, public choice, institutional economics, development economics, international finance, political economy of Turkey and the Middle East, and Islamic economics, finance and management.