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International Max Planck Research School
on the Social and Political Constitution of the Economy


Roy Karadag

Political Capitalisms: Power, Elites and the Economy in Turkey and the Philippines.

Studies on the Social and Political Constitution of the Economy. IMPRS-SPCE, Cologne 2010.
 
Abstract
 
What distinguishes Western from non-Western types of economic order on the macro level is the highly politicized nature of capitalism in the latter cases. Because the capitalism in these cases originated in colonial and imperial contexts and in struggles for new national identities, no institutional separation of the political from the economic sphere took place. Such a separation was essential for the institutionalization of Western "rational" capitalism. Despite economic and political modernization, the transition toward a rational mode of capitalism did not happen in these late-developing countries. Political capitalism in these areas is reproduced through personal trust relations, corruption and clientelism included, that continually undermine the capacities of institutional trust and enforce a general environment of politically induced uncertainty on economic actors in particular. In spite of these common features, developing countries differ from one another on a fundamental level, with the most important defining criteria being Michael Mann's notions of infrastructural and despotic power. While the Western paths to liberal capitalism have all come from high infrastructural power and low despotic power, the state formation processes in imperial settings have led to divergent results. In modern Turkey, the successful national liberation struggle after World War I set the stage for new national elites to take over the state apparatus and shape both national identities and the economic system (state capitalism). In the Philippines, the failure of the national liberation movement and the establishment of the new U.S. colonial regime created an oligarchic order. With reference to James Mahoney's "reactive sequence" model, twentieth-century institutional changes are accounted for by including the social and political forces that counter the respective capitalist order. Within the Turkish state capitalist system, change dynamics began to unfold and to undermine the established economic order in the late 1940s, when multi-party politics was introduced. The Philippine case shows that low degrees of state power easily reproduce themselves while at the same time they remain open to the patrimonializing dynamics that paved the way for Marcos' authoritarian regime and patrimonial capitalism. Political and economic transformations since the 1980s have resulted in oligarchic orders that each have a different potential for change. Oligarchy has experienced waves of delegitimization in both Turkey and the Philippines, but only in Turkey have the electoral results for counterelites led to substantive institutional changes, as under the current moderate Islamist government. Such political dynamics have not had an effect in the Philippine political landscape, where there is no potential for increased infrastructural power.
 
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