The political economy of inequality, redistribution and boom-bust cycles in Turkey

There has been a remarkable continuity in the main characteristics that determined the growth regime in Turkey in the last two decades despite seemingly significant political changes. This neoliberal speculation and finance-led growth regime has proved to be both socially and economically unstable, as shown by the post-Great Recession developments as well as the recent history of Turkey, which is marked by regular boom and bust cycles. In the recent global crisis, Turkey had one of the severest recessions in 2009 –deeper than other major emerging economies. The recovery since 2009 is as fragile as before. In the last decade insecurity has increased for all segments of the working people bare the poorest. The structural changes in the economy and the policies of ruling government of the last decade has initiated a redistribution towards the poorest of the society; but the source of this redistribution was income scrapped from the organized blue collar and white-collar/professional working people rather than taxes on corporate profits and the rich. Turkey’s growth model dependent on cheap labour, speculative financial capital inflows, a construction boom and a high trade deficit, would have experienced a crisis sooner or later even without the Great Recession.