The Place of the Economy in Turkish Society

In the 1980s, Turkey, like many other countries similarly situated in the world economy, ¹ had changed its economic strategy from a protectionist model characterized by heavy state intervention to a more outward-looking and market-oriented one. This change is often interpreted in terms of a basic dichotomy between the state and the market, and in this article I explore the changing place of the economy in Turkish society to highlight the limitations of the dichotomy in question.

"The place of the economy in society" is a phrase introduced and used by Karl Polanyi to investigate the basic coordinates of the livelihood of the individual in society. ² For Polanyi, economy is "an instituted process," and the way it is instituted in a given society can be analyzed by looking at the relative importance played by the integrating principles of exchange, redistribution, and reciprocity in the allocation of resources. Exchange denotes the nonenduring and unbinding relations between anonymous individuals on competitive markets. Redistribution characterizes the role that the state plays in the economy via taxation and government spending. Exchange and redistribution acquire their significance in the formal and legally binding context of market allocation and state intervention, while reciprocity is, in its nature, personal and informal. In general, relations of reciprocity follow the family metaphor in their different manifestations among fellow townsmen, neighbors, religious or ethnic community members, or within mafia-like organizations formed to realize illicit gain for their members.

This theoretical approach guides Polanyi's account of the nineteenth-century market economy as a unique and unnatural phenomenon incompatible with human society. This observation does not refer to the economic role played by markets in many different societies in history, but approaches the market society as one where the economy as a whole is instituted as a series of self-regulating markets. In an attempt to develop this idea, Polanyi highlights the qualitative difference between exchange on the one hand, and redistribution and reciprocity on the other. The supporting institutional patterns of the latter are not only, or primarily, economic in nature. Hence, the state and kinship or community exist prior to, and independently of, whatever economic roles they play. On the other hand, market, the supporting institutional pattern of exchange, is solely economic in function. In a setting where resource allocation takes place primarily in self-regulating markets, economy appears "disembedded" from society. Such a self-regulating market economy implies the commodification of land, labor, and money. This, for Polanyi, is an unusual state of affairs, which (a) could not spontaneously occur without deliberate intervention and (b) is bound to exercise a disruptive impact on the social fabric. Exchange, in other words, could hardly form the basis of social integration and should be complemented with either one or both of the two other integrating principles for the formation and containment of the market. On the basis of the nineteenth-century circumstances he has investigated, Polanyi mainly discusses the way redistribution has assumed this double task and reciprocity receives limited attention in this regard.

However, state intervention could at times leave a large area of regulation to networks of social relations, as in the case of many late-industrializing countries of the twentieth century. In this case, the principle of reciprocity indeed plays an important role in defining the place of the economy in society and shaping the nature of rights and entitlements of people, as illustrated by the Turkish case. But the case of Turkey also shows that reciprocity relations, where they play an important economic role, tend to permeate market exchange and state intervention, shaping the formal framework of the latter in conformity with their informal and personal character. In Turkey, in the post-1980 period, this particular way of instituting the economy has undergone a certain transformation without, nevertheless, leaving its essentially reciprocity-based character. What I am suggesting here is that the degeneration of state...