ANADOLU SELÇUKLU DEVLETİ

Historical Evolution of Scientific Knowledge in

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Middle East Technical University

Declaration of Originality

The intellectual content of this

The intellectual content of this dissertationdissertation, which has been written , which has been written by me and for which I take full responsibility, is my own, original work, by me and for which I take full responsibility, is my own, original work, and it has not been previousland it has not been previously or concurrently submitted elsewhere for y or concurrently submitted elsewhere for any other examination or degree of higher education. The sources of all any other examination or degree of higher education. The sources of all paraphrased and quoted materials, concepts, and ideas are fully cited, paraphrased and quoted materials, concepts, and ideas are fully cited, and the admissible contributions and assistance of others with respect and the admissible contributions and assistance of others with respect to the conception of the work as well as to linguistic expression are ex-to the conception of the work as well as to linguistic expression are ex-plicitly acknowledged herein.plicitly acknowledged herein.

Abstract

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“Historical Evolution of Scientific Knowledge in Turkey: Historical Evolution of Scientific Knowledge in Turkey:

The Discipline of Economics from the 1930s to

The Discipline of Economics from the 1930s to the the 1960s1960s””

This dissertation analyzes the

This dissertation analyzes the historical historical evolution of the economics dis-evolution of the economics dis-cipline cipline thrthrough the publications ofough the publications of Istanbul University Faculty of Eco-Istanbul University Faculty of Eco-nomics and Ankara University Faculty of Political Sciences in between nomics and Ankara University Faculty of Political Sciences in between the 1930s and the 1960s. This period, the 1930s and the 1960s. This period, from the foundation of the Facul-from the foundation of the Facul-ty of Economics tillty of Economics till the new mainstream was established bthe new mainstream was established by the neo-y the neo-classical synthesis, represents a blurred era during when the discipline classical synthesis, represents a blurred era during when the discipline of economics was shaped by various social and political factors bothof economics was shaped by various social and political factors both locallocallyly and internationaland internationallyly. In formation of the teaching of economics . In formation of the teaching of economics and economic thought at the univerand economic thought at the university level, this study concentrates on sity level, this study concentrates on the roles of academic economists who appeared as the main actors in the roles of academic economists who appeared as the main actors in ththee translation process of translation process of the currentthe current economic theories and the pre-economic theories and the pre-cepts of various schools of thought into localcepts of various schools of thought into local. Based on a detailed textu-. Based on a detailed textu-al analyal analysis on the university publications, this study examines in what sis on the university publications, this study examines in what ways and to what degree this translation was materialized in the local ways and to what degree this translation was materialized in the local context,context, as well asas well as how the economic knowledge, the scope and how the economic knowledge, the scope and the the components of the discipline of economics were conceptucomponents of the discipline of economics were conceptualized by aca-alized by aca-demic economistsdemic economists in the zeitgeistin the zeitgeist.. TThis dissertation argues that thhis dissertation argues that thisis re-re-ception/translation processception/translation process that shaped the that shaped the evolution of economics at evolution of economics at the educational field went beyond an effort of imitating the experience the educational field went beyond an effort of imitating the experience of developed countriesof developed countries, but s, but shaped by the utilization of eclectic methods haped by the utilization of eclectic methods within the context of local peculiarities, which reflects the influence of within the context of local peculiarities, which reflects the influence of the valuethe value--added by academic economists.added by academic economists.

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Özet

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“Türkiye’de Bilimsel Bilginin Tarihsel Gelişimi: 1930lardan 1960lara Türkiye’de Bilimsel Bilginin Tarihsel Gelişimi: 1930lardan 1960lara İktisat Disipliniİktisat Disiplini””

Şebnem Gelmedi

Şebnem Gelmedi, Doktora Adayı, , Doktora Adayı, 20232023

Boğaziçi Üniversitesi Atatürk İlkeleri ve İnkılap Tarihi Enstitüsü

Doçent

Doçent Ziya Umut TüremZiya Umut Türem ve Profesör Zafer Toprak, ve Profesör Zafer Toprak, Tez DanışmanTez Danışmanlarlarıı

Bu çalışma, 1930lardan 1960lara Türkiye’de iktisat disiplininin tarih

Bu çalışma, 1930lardan 1960lara Türkiye’de iktisat disiplininin tarihssel el gelişimini, İstanbul Üniversitesi İktisat Fakültesi ve Ankara Üniversitesi gelişimini, İstanbul Üniversitesi İktisat Fakültesi ve Ankara Üniversitesi Siyasal Bilgiler Fakültesi yayınları üzerinden incelemektedir. İstanbul Siyasal Bilgiler Fakültesi yayınları üzerinden incelemektedir. İstanbul Üniversitesi İktisat Fakültesi’niÜniversitesi İktisat Fakültesi’nin kuruluşundan, neoklasik sentezin n kuruluşundan, neoklasik sentezin iktisat eğitiminde anaakım haline gelmesine kadar geçen bu süreç, iktisat eğitiminde anaakım haline gelmesine kadar geçen bu süreç, iktisat disiplininin iktisat disiplininin yerel ve uluslararası düzeyde yerel ve uluslararası düzeyde çeşitli sosyal ve politik çeşitli sosyal ve politik faktörlerin etkisiyle şekillendiği flu bir dönemi yansıtmaktadır. Bu faktörlerin etkisiyle şekillendiği flu bir dönemi yansıtmaktadır. Bu çalışma, çalışma, iktisat eğitimi ve üniversite düzeyinde iktisadi düşüncenin iktisat eğitimi ve üniversite düzeyinde iktisadi düşüncenin formasyonunda, mevcut iktisadi teorilerin ve düşünce okullarının formasyonunda, mevcut iktisadi teorilerin ve düşünce okullarının öğretilerinin yerele aktarılış sürecinde başlıca aktörler olan akademik öğretilerinin yerele aktarılış sürecinde başlıca aktörler olan akademik iktisatçıların rolüne odaklanmaktadır. Bu aktarımın, zamanıiktisatçıların rolüne odaklanmaktadır. Bu aktarımın, zamanın ruhu ve n ruhu ve yerelin özgül koşulları bağlamında ne ölçüde ve ne şekilde gerçekleştiği, yerelin özgül koşulları bağlamında ne ölçüde ve ne şekilde gerçekleştiği, akademik iktisatçılarakademik iktisatçılar tarafındantarafından bilginin nasıl kavramsallaştırılıp bilginin nasıl kavramsallaştırılıp içselleştirildiği, iktisat disiplinin içeriği ve bileşenlerinin nasıl tahayyül içselleştirildiği, iktisat disiplinin içeriği ve bileşenlerinin nasıl tahayyül edildiği, üniversite yayıedildiği, üniversite yayınlarının detaylı bir analizi üzerinden nlarının detaylı bir analizi üzerinden incelemektedir. Bu tezde, iktisat öğretimini biçimlendiren bu alımlama incelemektedir. Bu tezde, iktisat öğretimini biçimlendiren bu alımlama sürecinin, gelişmiş ülke deneyimlerinin yerelde mutlak bir örneğini sürecinin, gelişmiş ülke deneyimlerinin yerelde mutlak bir örneğini tesis etme çabasından öte, teorilerin yerelleştirilmesi sürecinde tesis etme çabasından öte, teorilerin yerelleştirilmesi sürecinde akademik iktakademik iktisatçılarisatçılar tarafındantarafından sağlanan önemli bir katma değerin sağlanan önemli bir katma değerin varlığını yansıttığı vurgulanmaktadır. varlığını yansıttığı vurgulanmaktadır.

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131.0000 00 kelimekelime

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To my mother

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Table of Contents

Abbreviations and Acronyms

Abbreviations and Acronyms xvxv

Acknowledgements

Acknowledgements xviixvii

1 INTRODUCTIONINTRODUCTION 11

1.1 Literature ReviewLiterature Review 88

1.2 Organization of DissertationOrganization of Dissertation 2244

2 FOUNDATION OF FOUNDATION OF THETHE NEW FACULTY OF ECONONEW FACULTY OF ECONOMICSMICS IN ISTANBUL IN ISTANBUL UNIVERSITYUNIVERSITY 3311

2.1 Historical BackgroundHistorical Background 3333

2.2 Institutionalization of Economics in Turkey: Foundation of the Institutionalization of Economics in Turkey: Foundation of the Faculty Faculty 3366

2.3 Concluding RemarksConcluding Remarks 6868

3 THE DEFINITION, SCOPTHE DEFINITION, SCOPE AND METHOD OF ECONE AND METHOD OF ECONOMICSOMICS 7733

3.1 The DefiniThe Definition and Subject Matter of Economicstion and Subject Matter of Economics 7755

3.2 The Methodology DebateThe Methodology Debate 9900

3.3 Theories on Value and PriceTheories on Value and Price 101000

3.4 The Relations between Production and DistributionThe Relations between Production and Distribution 101077

3.5 AA General General Evaluation onEvaluation on EconomicsEconomics TextbooksTextbooks 112211

4 PUBLIC FINANCEPUBLIC FINANCE 114411

4.1 Historical Development of Public FinaHistorical Development of Public Finance and Fiscal Theoriesnce and Fiscal Theories 141444

4.2 ImplementationsImplementations of Public Financeof Public Finance and Financial Policies in Tur-and Financial Policies in Tur-keykey 114949

4.3 The Conceptual Framework of Public Finance in AcademiaThe Conceptual Framework of Public Finance in Academia 151533

4.4 Concluding ReConcluding Remarksmarks 181855

5 SOCIOLOGY AND SOCIOLOGY AND SOCIAL POLICYSOCIAL POLICY 119911

5.1 The Historical Background of Social PolThe Historical Background of Social Policyicy 119922

5.2 Social Policy Experience in TurkeySocial Policy Experience in Turkey 202000

5.3 Social Policy in Academic Texts and JournalsSocial Policy in Academic Texts and Journals 220808

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5.4 Concluding RemarksConcluding Remarks 223939

6 DEVELOPMENT ECONOMICDEVELOPMENT ECONOMICSS 242433

6.1 The Historical Background of Development EconomicsThe Historical Background of Development Economics 242455

6.2 Theories on Development EconomicsTheories on Development Economics 225500

6.3 The Developmental The Developmental History of TurkeyHistory of Turkey 225858

6.4 Conceptualizations on Development Economics and Developmen-Conceptualizations on Development Economics and Developmen-tal Policies in the University Journalstal Policies in the University Journals 262633

6.5 Concluding RemarksConcluding Remarks 229900

7 THE IMPACT OF KEYNESTHE IMPACT OF KEYNESIAN REVOLUTIONIAN REVOLUTION 292955

7.1 Historical BackgroundHistorical Background 292977

7.2 Keynesian Theory and Its Influence on the NaKeynesian Theory and Its Influence on the Nature of Economic ture of Economic AnalysisAnalysis 300300

7.3 The Spread of Keynesian Ideas Across Some Industrialized Na-The Spread of Keynesian Ideas Across Some Industrialized Na-tions 30tions 3044

7.4 TheThe Impact of Keynesian Precepts in the Policy Making in TurkeyImpact of Keynesian Precepts in the Policy Making in Turkey 331122

7.5 The Reception of Keynes in the Academic Sphere in TurkeyThe Reception of Keynes in the Academic Sphere in Turkey 313177

7.6 Concluding RemarksConcluding Remarks 334433

8 SSOME REFLECTIONS ON TOME REFLECTIONS ON THE IDEOLOGICAL ATMOSHE IDEOLOGICAL ATMOSPHERE: THE PHERE: THE DETERMINING FACTORS DETERMINING FACTORS BEHIND THE ADHERENCEBEHIND THE ADHERENCE TO CAPITALISMTO CAPITALISM 343477

8.1 Ideological Orientations until the end of the Second World WarIdeological Orientations until the end of the Second World War 353511

8.2 Ideological Preferences in Turkey after the WarIdeological Preferences in Turkey after the War 363633

8.3 What Changed and What RemaWhat Changed and What Remained in the 1960s?ined in the 1960s? 373711

8.4 Concluding RemarksConcluding Remarks 373766

9 CONCLUSIONCONCLUSION 337799

BIBLIOGRAPHY

BIBLIOGRAPHY 393977

Abbreviations and Acronyms

İÜİFMİÜİFM İstanbul Üniversitesi İktisat Fakültesi Mecmuası (Is-İstanbul Üniversitesi İktisat Fakültesi Mecmuası (Is-tanbul Journal of Economics)tanbul Journal of Economics)

İÜSSKD İÜSSKD İstanbul Üniversitesi Sİstanbul Üniversitesi Sosyal Siyaset Konferansları osyal Siyaset Konferansları Dergisi (Journal of Social Policy Conferences)Dergisi (Journal of Social Policy Conferences)

İÜMAMK İÜMAMK İstanbul Üniversitesi Maliye Araştırmaları Merkezi İstanbul Üniversitesi Maliye Araştırmaları Merkezi Konferansları (The Conference Journal of Financial Konferansları (The Conference Journal of Financial Studies Center)Studies Center)

İÜHFMİÜHFM İstanbul Üniversitesi Hukuk Fİstanbul Üniversitesi Hukuk Fakültesi Mecmuası akültesi Mecmuası (Journal of Istanbul University Law Faculty)(Journal of Istanbul University Law Faculty)

AÜSBFAÜSBFDD Ankara Üniversitesi Siyasal Bilgiler Fakültesi Dergisi Ankara Üniversitesi Siyasal Bilgiler Fakültesi Dergisi (Ankara University SBF Journal)(Ankara University SBF Journal)

AÜHFD AÜHFD Ankara Üniversitesi Hukuk Fakültesi Dergisi (Journal Ankara Üniversitesi Hukuk Fakültesi Dergisi (Journal of Ankara Univeof Ankara University Law Faculty)rsity Law Faculty)

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Acknowledgements

First of all, I would like to express my gratitude

First of all, I would like to express my gratitude to the supervisors of to the supervisors of this dissertation, Zafer Toprak and Umut Türemthis dissertation, Zafer Toprak and Umut Türem who provided intellec-who provided intellec-tual guidance and contribtual guidance and contributed to the formation of this study. Zafer To-uted to the formation of this study. Zafer To-prak was such a source of inspiration to me with his inprak was such a source of inspiration to me with his in--depth depth knowledge and excitement for this subjectknowledge and excitement for this subject, while , while Umut Türem gave de-Umut Türem gave de-tailed feedbacks which enriched my thinking and provided invaluable tailed feedbacks which enriched my thinking and provided invaluable theoretical intheoretical insights in evaluating the sources. I thank my supervisors for sights in evaluating the sources. I thank my supervisors for their guidance, support and trust their guidance, support and trust iin me all through this long journey. I n me all through this long journey. I am also grateful to the professors in Atatürk Institute, particularly to my am also grateful to the professors in Atatürk Institute, particularly to my master thesis advisor Şevket Pamuk, for being master thesis advisor Şevket Pamuk, for being an academic role model an academic role model in all respectsin all respects andand toto Ayşe Buğra, for her kindness and enlightening Ayşe Buğra, for her kindness and enlightening viewpointviewpointss which had great influence on my academic life.which had great influence on my academic life.

I would also

I would also like to like to thank my jury members. thank my jury members. I thank I thank Cengiz KırlıCengiz Kırlı for for his encouraging comments that motivathis encouraging comments that motivate e me to pursueme to pursue further studies further studies in this research fieldin this research field. I also extend my gratitude. I also extend my gratitude to Fikret Adaman for his to Fikret Adaman for his guidance in figuring out an axis for the studyguidance in figuring out an axis for the study, which, which strengthened the strengthened the framework of the dissertationframework of the dissertation. Additionally, I would like to express my . Additionally, I would like to express my apprecappreciationiation to Ercan Eren for his generosity in sharing intellectual to Ercan Eren for his generosity in sharing intellectual in-in-sights sights on this subject and to Çınla Akdere for her recommendations and on this subject and to Çınla Akdere for her recommendations and support. I am grateful to Eyüp Özveren, Mahfi Eğilmez, İzzettin Önder, support. I am grateful to Eyüp Özveren, Mahfi Eğilmez, İzzettin Önder, Roger Backhouse and Marco Guidi for their valuable suggestions and Roger Backhouse and Marco Guidi for their valuable suggestions and comments. I owe thanks to the staff of the institute, comments. I owe thanks to the staff of the institute, Kadriye Aksoy, Dilek Kadriye Aksoy, Dilek Tecirli and Leyla Kılıç, who provided such an enjoyable atmosphere. Tecirli and Leyla Kılıç, who provided such an enjoyable atmosphere.

I would like to thank the head of the Department of ATA in Yıldız

I would like to thank the head of the Department of ATA in Yıldız Technical University, Mehmet Beşikçi and my colleaguesTechnical University, Mehmet Beşikçi and my colleagues Neslihan Erkan Neslihan Erkan and Gülsema Lüyer for always band Gülsema Lüyer for always being supportive and helpful. The eing supportive and helpful. The count-count-less helpful discussionsless helpful discussions with my with my friends from friends from Yıldız Economics, Yıldız Economics, Alaaddin TokAlaaddin Tok,, Sırrı Emrah Üçer Sırrı Emrah Üçer and Ecem Doygun wand Ecem Doygun wereere invaluable. I invaluable. I thank them for all their patience and always being close at hand. I owe thank them for all their patience and always being close at hand. I owe special thanks tspecial thanks to my dear students in Yıldız Technical University. They o my dear students in Yıldız Technical University. They always appreciated my teachings and motivated me to work harder.always appreciated my teachings and motivated me to work harder.

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I also would like to thank all my Atatürk Institute friends I came

I also would like to thank all my Atatürk Institute friends I came across through this journey for their companionships. I am especiallacross through this journey for their companionships. I am especially y thankful to Gamze Canlı, with whom all the compelling times of the PhD thankful to Gamze Canlı, with whom all the compelling times of the PhD years became tolerable. Ece Cihan Ertemyears became tolerable. Ece Cihan Ertem,, Deniz PelekDeniz Pelek, , Neşe Voyvoda, Neşe Voyvoda, Hazal Papuççular, Mustafa Batman and Önder Uçar Hazal Papuççular, Mustafa Batman and Önder Uçar were always encour-were always encour-aging in our long and joyaging in our long and joyfulful conversations. conversations.

Boğa

Boğaziçi University has always been a home for me. In addition to ziçi University has always been a home for me. In addition to the intellectual environment the intellectual environment that surrounded methat surrounded me, I came to understand , I came to understand the true meaning of friendship during my Boğaziçi years. Ayşe Hilal the true meaning of friendship during my Boğaziçi years. Ayşe Hilal Kaymak, GizemKaymak, Gizem NurNur CopCopççuoğlu and Burcu Sağlam were alwaysuoğlu and Burcu Sağlam were always there for there for me, sharing me, sharing bothboth joy and sorrow throughjoy and sorrow throughoutout these years. Özge Demirci, these years. Özge Demirci, Berkant Kepez, Taha Ceritli, Çağatay YıldızBerkant Kepez, Taha Ceritli, Çağatay Yıldız, Emre Erdoğan, Eylem , Emre Erdoğan, Eylem Taşdemir andTaşdemir and Nezihe Pehlivan always cheered my up with their endless Nezihe Pehlivan always cheered my up with their endless support and kindness. I support and kindness. I am indebted toam indebted to EkEkin Can Göksoy for his neverin Can Göksoy for his never--ending encouragement since high school. The ending encouragement since high school. The friendships of Aslı Uğurlu, friendships of Aslı Uğurlu, Deniz Uğurlu, Aslı Orhon, Pınar Ertör, Irmak Ertör and Hazal Şenses Deniz Uğurlu, Aslı Orhon, Pınar Ertör, Irmak Ertör and Hazal Şenses wewere of great value to me, always making me feel embraced by re of great value to me, always making me feel embraced by eempathy. mpathy. It was a great pleIt was a great pleasure to share the journey with them.asure to share the journey with them.

I am deeply grateful to my teacher

I am deeply grateful to my teacher--family. My decedent grandfather family. My decedent grandfather Zihni Gümüştekin, who raised numerous students, was the guiding spir-Zihni Gümüştekin, who raised numerous students, was the guiding spir-it for my academic career. He it for my academic career. He ignited myignited my intellectual curiosity since my intellectual curiosity since my childhood childhood years and never lost faith years and never lost faith iin me. n me. My aunt Zuhal İçer, my uncle My aunt Zuhal İçer, my uncle Necati İçer and my cousin Kıvanç İçer were Necati İçer and my cousin Kıvanç İçer were constantly constantly supportsupportive and ive and helpfulhelpful. . My mother Ülker Gelmedi has always been a great teacher, not My mother Ülker Gelmedi has always been a great teacher, not only in her classes but also in life. Her devotion to only in her classes but also in life. Her devotion to me is beyond words. me is beyond words. SShe has always been a source of inspiration and an endless support to he has always been a source of inspiration and an endless support to me. My father Hüseyin Gelmedi, a painting teacher, me. My father Hüseyin Gelmedi, a painting teacher, broadenedbroadened my vision my vision and taught me see the world within the perspective of art, colored with and taught me see the world within the perspective of art, colored with optimism and hope.optimism and hope. I coI consider myself fortunate to have you as my fami-nsider myself fortunate to have you as my fami-lyly. . This dissertation would not have been possible without you.This dissertation would not have been possible without you.

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NOTE

NOTE:: The inThe in--house editor of the Atatürk Institute has made de-house editor of the Atatürk Institute has made de-tailed recommendations with regard to the format, grammar, spelling, tailed recommendations with regard to the format, grammar, spelling, usage, syntax, and style of thisusage, syntax, and style of this dissertationdissertation..

1IntroductionIntroduction

Economic science has no homeland, though it is conomic science has no homeland, though it is represented and corepresented and conveyed through different nveyed through different tongues, anthems and flags. But, as it is the work tongues, anthems and flags. But, as it is the work of scientists, we cannot ignore the fact that this of scientists, we cannot ignore the fact that this homeless quest creates links between a huge homeless quest creates links between a huge number of people... Although these people are number of people... Although these people are united by a common pursuit of knowledgeunited by a common pursuit of knowledge, they , they are nevertheless spread all around the world, are nevertheless spread all around the world, giving factual existence to schools and other par-giving factual existence to schools and other par-ticular institutional environments where science ticular institutional environments where science is actually produced and nurtured.is actually produced and nurtured.

–

– AntAntoonio nio Almodovar and JosAlmodovar and Joséé LuLuiis Cardosos Cardoso, , A History of Portuguese EcoA History of Portuguese Economic Thought,nomic Thought, 22..

cientific knowledge is constituted incidental to a complex social

cientific knowledge is constituted incidental to a complex social process within which the institutional, conceptual and materialprocess within which the institutional, conceptual and material

Ş E B N E M G E L M E D İ

relations occur as the key elements in grounding the epistemic founda-

relations occur as the key elements in grounding the epistemic founda-tions of science.tions of science.1 This viewpoint uThis viewpoint unsettles the nsettles the unityunity of economic science of economic science and gave rise to studies characterized as “sociologically grounded anal-and gave rise to studies characterized as “sociologically grounded anal-ysis of the development of economics as a science and as a profession.”ysis of the development of economics as a science and as a profession.”2 In this way, not only the empirical domain of the research is expanded In this way, not only the empirical domain of the research is expanded bubut also the new theoretical insights broaden horizons in construing the t also the new theoretical insights broaden horizons in construing the development of economics.development of economics.3 Thence, inspired by the statementsThence, inspired by the statements:: “scien-“scien-tific truth is itself historical. The issue therefore is not simply what is tific truth is itself historical. The issue therefore is not simply what is universal but what is evolving, and whetuniversal but what is evolving, and whether that which is evolving is her that which is evolving is necessarily identifiable with progress”necessarily identifiable with progress”4; in this dissertation I intend to ; in this dissertation I intend to analyze the formation and evolution of the economics discipline in Tur-analyze the formation and evolution of the economics discipline in Tur-key in a constructivist way, based on a research on the teachings and key in a constructivist way, based on a research on the teachings and publicationpublications of the two prominent universities, Istanbul University Fac-s of the two prominent universities, Istanbul University Fac-ulty of Economics and Faculty of Law and Ankara University Faculty of ulty of Economics and Faculty of Law and Ankara University Faculty of Political Science and Faculty of Law, from Political Science and Faculty of Law, from the the 1930s to 1930s to thethe 1960s. 1960s.

The curiosity behind this dissertation was due to reading

The curiosity behind this dissertation was due to reading various various works works about the history of economic thought in global and national about the history of economic thought in global and national scales but recognizing lack of studies related with the scales but recognizing lack of studies related with the evolution of eco-evolution of eco-nomics within a nomics within a sociology of knowledge perspective in Turkey. Such sociology of knowledge perspective in Turkey. Such studies are significant in the sense that studies are significant in the sense that asking methodological ques-asking methodological ques-tions about the character and goal of economics is of the essence in tions about the character and goal of economics is of the essence in formulating answers for the question of “what should economics be formulating answers for the question of “what should economics be like”like”5 in a country and this can’t be properly understood unless the leg-in a country and this can’t be properly understood unless the leg-

1 YYuval P. Yuval P. Yonay,onay, The Struggle over the Soul of Economics: Institutionalist and Neoclassical The Struggle over the Soul of Economics: Institutionalist and Neoclassical Economists in America Between the WarsEconomists in America Between the Wars (Princeton, New Jersey: (Princeton, New Jersey: Princeton University Princeton University Press, 1998Press, 1998)), 15, 15--1717..

2 Marion Marion Fourcade, “Economics Fourcade, “Economics a Sociology ofa Sociology of,,” ” iin n International EncyInternational Encycclopedia of lopedia of Economic Sociology,Economic Sociology, ededs.s. Jens Beckert and Milan ZafirovskiJens Beckert and Milan Zafirovski (London: Routledge,(London: Routledge, 20052005),), 216216..

3 IbIbiidd.., 216, 216..

4 Immanuel Wallerstein, Immanuel Wallerstein, Open the Social Sciences: Report of the Gulbenkian Commission Open the Social Sciences: Report of the Gulbenkian Commission on the Reson the Restructuring of the Social Sciencetructuring of the Social Sciences s (Stanford, California:(Stanford, California: Stanford University Stanford University Press, 1996), 58Press, 1996), 58..

5 YonayYonay, , The StruggleThe Struggle, 26, 26..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

acy of the past is cons

acy of the past is considered. At this point, Bilsay Kuruidered. At this point, Bilsay Kuruçç’s article “’s article “İİktisat ktisat Nasıl Okutulmalı” (How Economics Should Be Taught) encouraged me Nasıl Okutulmalı” (How Economics Should Be Taught) encouraged me to study on this field as well. According to Kuruç, it is significant to see to study on this field as well. According to Kuruç, it is significant to see how the developments in Turkey oriented us to certain categories of how the developments in Turkey oriented us to certain categories of knowledge. He puts emphasis on the facknowledge. He puts emphasis on the fact that t that the the argumentation of an argumentation of an economist should contain the effectualness of those categories of economist should contain the effectualness of those categories of knowledge and the institutions that these categories of knowledge are knowledge and the institutions that these categories of knowledge are shaped within the view of the whole structure that designates the econ-shaped within the view of the whole structure that designates the econ-omy.omy.6 According to According to KuruKuruçç, the primary purpose of such a research is to , the primary purpose of such a research is to manifest what kind of impacts the economists in Turkeymanifest what kind of impacts the economists in Turkey –– whowho work work within the existing knowledge in economicswithin the existing knowledge in economics –– were were most sensitive and most sensitive and open.open.7

This inquisition arises from a critical observation at the uni

This inquisition arises from a critical observation at the university versity levellevel alleging alleging that that the the economics education in Turkey could not go be-economics education in Turkey could not go be-yond a successful effort of imitating the economics education in the de-yond a successful effort of imitating the economics education in the de-veloped capitalist countries.veloped capitalist countries.8 HHaving knowledge in economics was aving knowledge in economics was meant to assimilate the categories of knowlmeant to assimilate the categories of knowledge peculiar to those coun-edge peculiar to those coun-tries and be successful in terms of tries and be successful in terms of theirtheir standards. However, standards. However, KuruçKuruç em-em-phasizes that phasizes that ““the reasonableness of their conventional wisdom in our the reasonableness of their conventional wisdom in our

6 Bilsay KuruBilsay Kuruçç, “, “İİktisat Nasıl Okutulmalı?ktisat Nasıl Okutulmalı?,,” ” Ankara Ankara ÜÜniversitesi Siyasal Bilgiler Fakuniversitesi Siyasal Bilgiler Fakültesi ltesi DergisiDergisi 25, no. 3 (25, no. 3 (19701970):): 173.173.

7 KuKuruç intutitively states that the economic methodology and knowledge that are ruç intutitively states that the economic methodology and knowledge that are comprehended in the curriculums of economics are sensitive to the following points: comprehended in the curriculums of economics are sensitive to the following points: ““a) the socioa) the socio--economic structure of the country and the development of this structure, economic structure of the country and the development of this structure, b) the qb) the qualifications, instruments and the purposes of the applied economic policies, ualifications, instruments and the purposes of the applied economic policies, c) the position and preferences of Turkey in international politics, d) the assessments c) the position and preferences of Turkey in international politics, d) the assessments and observations on the developments in politics, technology and organizations.and observations on the developments in politics, technology and organizations.” ” Ku-Ku-ruruçç, “, “İİktisat Nasılktisat Nasıl,” ,” 178.178.

8 Ibid., 167. Ibid., 167. Fikret Görün in his articleFikret Görün in his article says that the dominant way of teaching says that the dominant way of teaching economics is to inherit everything from the West, even the the subject headings via economics is to inherit everything from the West, even the the subject headings via translations or adaptations since the middle of the 1930s till the 1translations or adaptations since the middle of the 1930s till the 1950s except 950s except the the transitiontransition periodperiod from Darülfünun to İstanbul University during when the discussions from Darülfünun to İstanbul University during when the discussions generated by the generated by the Kadro Kadro journal was very influentialjournal was very influential. Fikret Görün “Nasıl İktisatçı . Fikret Görün “Nasıl İktisatçı Oldum (mu)?: Çok Kişisel Bir Tarih ve Türkiye’de İktisat Eğitimi” in Oldum (mu)?: Çok Kişisel Bir Tarih ve Türkiye’de İktisat Eğitimi” in UlUlusal İktisat usal İktisat Eğitimi SempozyumuEğitimi Sempozyumu,, ed. Ercan Uygured. Ercan Uygur (Ankara: İmaj Yayınevi: 2005), 51.(Ankara: İmaj Yayınevi: 2005), 51.

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country is questionable due to the differences and divergences in devel-

country is questionable due to the differences and divergences in devel-opmental requiremeopmental requirements and ideal institutional structure.nts and ideal institutional structure.”” In addition, In addition, hehe warns the readers on the fact that warns the readers on the fact that ““by appropriating these instruments by appropriating these instruments and methodology, one should be aware that he/she is engaged into a and methodology, one should be aware that he/she is engaged into a certain political preference as wellcertain political preference as well””..9

Agreeing with Kuruç on

Agreeing with Kuruç on his assertion about the noticeable differ-his assertion about the noticeable differ-ences and divergences in Turkey which appear as barrierences and divergences in Turkey which appear as barrierss for the ap-for the ap-plicability of certain categories of knowledge, I argue that the evolution plicability of certain categories of knowledge, I argue that the evolution of the economics education went beyond an effort of imitating the expe-of the economics education went beyond an effort of imitating the expe-ririence of developed countries. A country in which a particular school of ence of developed countries. A country in which a particular school of thought was not generated due to various structural reasonsthought was not generated due to various structural reasons,, is ex-is ex-pected to be open to international flow of ideas in constructing econom-pected to be open to international flow of ideas in constructing econom-ic viewpoints instinctively. Yet, to meic viewpoints instinctively. Yet, to me,, this prthis process is better not reduced ocess is better not reduced to an imitation effort at least for the sake of its deliberate and eclectic to an imitation effort at least for the sake of its deliberate and eclectic approaches approaches visvis--àà--visvis certain theories and value added by the local aca-certain theories and value added by the local aca-demics. As claimed by Almodovar demics. As claimed by Almodovar and his colleaguesand his colleagues, the point most , the point most worth analysis worth analysis to me is, to me is,

to consider modes of transmission, reception, familiarization and

to consider modes of transmission, reception, familiarization and assimilation, detect the existence of barriers to entry or of incen-assimilation, detect the existence of barriers to entry or of incen-tives to importation, find the reasons for the different impacts of tives to importation, find the reasons for the different impacts of imported intellectual products. In other worimported intellectual products. In other words, we have to dis-ds, we have to dis-cover why some ideas or theories are irrefutably successful cover why some ideas or theories are irrefutably successful whereas others remain totally unknownwhereas others remain totally unknown. […] S. […] Such a process of uch a process of assimilation may involve the appearance of innovative elements assimilation may involve the appearance of innovative elements that confer some originality to the theoretical and dothat confer some originality to the theoretical and doctrinal lega-ctrinal lega-cy one is trying to reinterpret and develop, given the historical cy one is trying to reinterpret and develop, given the historical circumstances of the receiver country. In this case, one is not circumstances of the receiver country. In this case, one is not faced with the creation and development of a national tradition faced with the creation and development of a national tradition or style, but rather with a process of original ador style, but rather with a process of original adaptation that in-aptation that in-troduces significant modifications to the original frame of refer-troduces significant modifications to the original frame of refer-

9 KuruKuruçç, “, “İİktisat Nasılktisat Nasıl,” ,” 167167..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

ence, one that provides a national added value to the imported

ence, one that provides a national added value to the imported raw materialraw material..10

In this line, my intent in this dissertation is to reveal these “modifi-

In this line, my intent in this dissertation is to reveal these “modifi-cations to the original frcations to the original frame of reference” and the “national value added ame of reference” and the “national value added to the imported raw material” in presenting the dimensions of the re-to the imported raw material” in presenting the dimensions of the re-ception of current economic theories at educational level in Turkey, ception of current economic theories at educational level in Turkey, within which the local conditions and inner dynamics play the key rolewithin which the local conditions and inner dynamics play the key roless. . The academic economists occurred as the agents of this The academic economists occurred as the agents of this transla-transla-tiontion11/localization process in economics education amidst a variety of /localization process in economics education amidst a variety of theoretical and intellectual approaches coexisted, which precluded the theoretical and intellectual approaches coexisted, which precluded the beliefs or methods to fit under one specific label,beliefs or methods to fit under one specific label, even for the Western even for the Western economics.economics.12 In a period during when the communication In a period during when the communication channelschannels made economics remain internationalmade economics remain international,,13 I argue that the contributionI argue that the contributionss of the local academic economists in reshaping the current theories in of the local academic economists in reshaping the current theories in accordance with the peculiar reqaccordance with the peculiar requirements of the local, uirements of the local, rerepresent apresent ann idiosyncratic experience which would hopefully contribute to the exist-idiosyncratic experience which would hopefully contribute to the exist-ing literature of national histories of economic thought at educational ing literature of national histories of economic thought at educational level. level.

Obviously, the path followed up to now by economic research is far

Obviously, the path followed up to now by economic research is far frfrom linear and the appropriation of different analytical areas by differ-om linear and the appropriation of different analytical areas by differ-ent researchers would bring about completely distinct results about the ent researchers would bring about completely distinct results about the ccore ore themes or the most themes or the most importantimportant ideas of a ideas of a specificspecific school, school, domestic domestic

10 Antonio Almodovar and Jose Luis Cardoso, Antonio Almodovar and Jose Luis Cardoso, A History of Portuguese Economic ThoughtA History of Portuguese Economic Thought (Taylor & Francis e(Taylor & Francis e--Library, 2001), 2. This book was Library, 2001), 2. This book was first published (London: first published (London: Routledge, 1998).Routledge, 1998).

11 The concept of translationThe concept of translation was brought into sociology by Callon and Latourwas brought into sociology by Callon and Latour.. Yonay, Yonay, The The Struggle,Struggle, 2525..

12 Mary Mary MorganMorgan,, “Economics” in “Economics” in The Cambridge History of Science vol 7 The Modern Social The Cambridge History of Science vol 7 The Modern Social SciencesSciences,, ededs.s. TheoTheodore M. Porter and Dorothy Rossdore M. Porter and Dorothy Ross (Cambridge: (Cambridge: Cambridge University Cambridge University Press, 2003Press, 2003),), 280280..

13 IbidIbid.., 278, 278..

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tradition or time period.

tradition or time period.14 As Jakob BurckhAs Jakob Burckhardt claimed years ago “the ardt claimed years ago “the world of the ideas and mentalities draws different tablworld of the ideas and mentalities draws different tableaueaus for each s for each eye” eye” […] […] “Historians of thought inevitably simplify the subject matter, “Historians of thought inevitably simplify the subject matter, focusing on what they see as the most significant features.”focusing on what they see as the most significant features.”15 The de-The de-termining factor intermining factor in explaining an economic event is the viewpoint of the explaining an economic event is the viewpoint of the economist, which is determined by the belief system and philosophical economist, which is determined by the belief system and philosophical view adopted by himview adopted by him/her/her, consciously or subconsciously. Hence, it is not , consciously or subconsciously. Hence, it is not possible to distinguish an observation from the possible to distinguish an observation from the observer.observer.16 This situa-This situa-tion is valid both for the academic economists who appear as the ob-tion is valid both for the academic economists who appear as the ob-jects of analysis in this dissertation and for the author of these lines. jects of analysis in this dissertation and for the author of these lines. Hence,Hence, as emphasized in the comprehensive book edited by as emphasized in the comprehensive book edited by Warren J. Warren J. Samuels, Samuels, Jeff E. Jeff E. Biddle andBiddle and John B.John B. DaDavis on the history of economic vis on the history of economic thought,thought, the the aspirationaspiration is notis not to achieveto achieve a fara far--reachingreaching coverage ocoverage off all all the debates, but instead, to systematically the debates, but instead, to systematically focusfocus on a selection of on a selection of themesthemes17 that that correspond tocorrespond to the goals of the study.the goals of the study.

In this dissertation, two matters

In this dissertation, two matters are exposed as the main concerns in are exposed as the main concerns in selection of themes to be transformed into dissertation chapters. First, selection of themes to be transformed into dissertation chapters. First, the themes are determined in accordance with the broadness of the op-the themes are determined in accordance with the broadness of the op-portunities they offer for a research on translation of theories. The sec-portunities they offer for a research on translation of theories. The sec-ond cond concern is the relative weight of the themes in the current agenda oncern is the relative weight of the themes in the current agenda of economics and economy. In other words, both the constitutive parts of economics and economy. In other words, both the constitutive parts of the of the discipline of economicsdiscipline of economics and the subfields and the subfields withwithin which the nu-in which the nu-ances of ances of the the reception reception process appear process appear most evident amost evident are re designated designated as as

14 Jeff E. Biddle, “Research Styles in the History of Economic Thought” inJeff E. Biddle, “Research Styles in the History of Economic Thought” in A Companion to A Companion to the History of Economic Thoughtthe History of Economic Thought eds. eds. WarrenWarren J. J. SamuelsSamuels, Jeff E. B, Jeff E. Biddle and John B. Da-iddle and John B. Da-vis (vis (UKUK:: Blackwell Publishing, 2003Blackwell Publishing, 2003), ), 11..

15 Alessandro Roncaglia, Alessandro Roncaglia, The Wealth of Ideas: History of Economic ThoughtThe Wealth of Ideas: History of Economic Thought ((LondonLondon: : Cambridge University Press, 2005Cambridge University Press, 2005),), 505505.. JaJakkob Burckhardob Burckhardtt wawas a Swiss historian of art s a Swiss historian of art and culture.and culture.

16 Gülten KGülten Kazgan, azgan, İktisadi Düşünce veya Politik İktisadın Evrimiİktisadi Düşünce veya Politik İktisadın Evrimi (İstanbul: Remzi Kitabevi, (İstanbul: Remzi Kitabevi, 2012),2012), 3535..

17 Matthias Klaes, “Historiograpy” inMatthias Klaes, “Historiograpy” in A CompanionA Companion to the History of Economic Thoughtto the History of Economic Thought eds. eds. WarrenWarren J. J. SamuelsSamuels, Jeff E. Biddle and John B. Davis (, Jeff E. Biddle and John B. Davis (UKUK:: Blackwell Publishing, Blackwell Publishing, 22003003)), 492, 492..

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the chapter themes. The content of the chapters intends to reveal to

the chapter themes. The content of the chapters intends to reveal to what degree the present theories were translated, elaborate on the pos-what degree the present theories were translated, elaborate on the pos-sible reasons behind such an eclecticism and discuss how these themes sible reasons behind such an eclecticism and discuss how these themes are debated/evolved with an emare debated/evolved with an emphasis on the key concepts of each. phasis on the key concepts of each. How the How the ““idealideal” ” economicseconomics was constructed in the opinions of the aca-was constructed in the opinions of the aca-demic actors in this evolutionary process and the discourses which ex-demic actors in this evolutionary process and the discourses which ex-hibit their preferential basis would hopefully be revealed. As is suggest-hibit their preferential basis would hopefully be revealed. As is suggest-ed by Johned by John Davis, “in particular, research in the history of economics has Davis, “in particular, research in the history of economics has been concerned with discovering what people in the past have believed been concerned with discovering what people in the past have believed about phenomena that either they or the researcher regard as economic about phenomena that either they or the researcher regard as economic activity, and why they have believed it.”activity, and why they have believed it.”18

While co

While concentrating on the role of the academic economists on the ncentrating on the role of the academic economists on the translation/construction process; what did they read, through which translation/construction process; what did they read, through which mechanisms, categories and ideals they have manifested themselves, mechanisms, categories and ideals they have manifested themselves, what kind of modellings they had in mind would all be importantwhat kind of modellings they had in mind would all be important ques-ques-tions to be examined with a special emphasis on the corresponding his-tions to be examined with a special emphasis on the corresponding his-torical context and economic conditions. What is significant is to inves-torical context and economic conditions. What is significant is to inves-tigate in what ways the paradigm shifts in economic theory had tigate in what ways the paradigm shifts in economic theory had repercussions at local and shed light on the wrepercussions at local and shed light on the way how these actors inter-ay how these actors inter-nalize the nalize the existing existing knowledge. “The world is out there” claims philoso-knowledge. “The world is out there” claims philoso-pher Richard Rorty, “but descriptions of the world are not, they are hu-pher Richard Rorty, “but descriptions of the world are not, they are hu-man made.”man made.”19 Based on this perspective, utilization of a constructivist Based on this perspective, utilization of a constructivist method which studiemethod which studies science “as it is”s science “as it is”20 and reveal “how the view of and reveal “how the view of what is good is being constituted and then used to resolve debates what is good is being constituted and then used to resolve debates about nature”about nature”21 becomes significant. In this dissertation, I aim to adapt becomes significant. In this dissertation, I aim to adapt this viewpoint in analyzing the works of the academics to see how this viewpoint in analyzing the works of the academics to see how their their viewviewss oonn “what is optimal among various theories for Turkey” w“what is optimal among various theories for Turkey” wereere

18 JohnJohn B.B. Davis,Davis, D. Wade Hands, Uskali Maki, eds.,D. Wade Hands, Uskali Maki, eds., The Handbook of Economic Methodolo-The Handbook of Economic Methodolo-gygy ((Cheltenham, Cheltenham, UK; Northampton, MA, USA: E. ElgarUK; Northampton, MA, USA: E. Elgar, 1998, 1998), ), 22..

19 YonayYonay, , The StruggleThe Struggle, , 1155, quoted in, quoted in Richard Rorty (1989Richard Rorty (1989:: 5)5)..

20 IbidIbid.., 15, 15..

21 IbiIbid.d., 18, 18..

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evolved and then used to resolve the current problems about economics

evolved and then used to resolve the current problems about economics and economy. and economy.

By saying all these, we should always keep in mind that economics is

By saying all these, we should always keep in mind that economics is performative. This concept of “performative. This concept of “performativity” introduced by Michel performativity” introduced by Michel Callon purports that economics not only describes or analyzes the eco-Callon purports that economics not only describes or analyzes the eco-nomic phenomena as an object of analysis, but also contributes to the nomic phenomena as an object of analysis, but also contributes to the formation of that phenomena via its powerful discursive effects. In this formation of that phenomena via its powerful discursive effects. In this sense, sense, the significance of the actors in this construction process of eco-the significance of the actors in this construction process of eco-nomics education appears once again. Their articles and books provide nomics education appears once again. Their articles and books provide insights for understanding how they reinterpreted the economic theo-insights for understanding how they reinterpreted the economic theo-ries/reality, but that reality itself might ries/reality, but that reality itself might have have undeundergorgonene a transfor-a transfor-mation as a consequence of their way of doing science as well. Taking mation as a consequence of their way of doing science as well. Taking account of the fact that these economists were academic economists, account of the fact that these economists were academic economists, the power of performativity increases incrementally as the content of the power of performativity increases incrementally as the content of education transmitted by an insteducation transmitted by an institution has always been a substantial itution has always been a substantial instrument for shaping the mindset of future generations by producing instrument for shaping the mindset of future generations by producing and reproducing certain kinds of knowledge.and reproducing certain kinds of knowledge.

§ 1.1 Literature ReviewLiterature Review

This dissertation can be located at the intersection point of the national

This dissertation can be located at the intersection point of the national historieshistories of economic thought and sociology of economics, both of of economic thought and sociology of economics, both of which offers a growing literature in recent years. Particularly influenced which offers a growing literature in recent years. Particularly influenced by Bob Coats’ work on the professionalization of British and American by Bob Coats’ work on the professionalization of British and American Economics (1993), significant monographs were producedEconomics (1993), significant monographs were produced on the insti-on the insti-tutionalization of the discipline among various countries.tutionalization of the discipline among various countries.22 The sub-The sub-

22 Marion FourcadeMarion Fourcade--Gourinchas, “Economic Sociology and the Sociology of Economics: Gourinchas, “Economic Sociology and the Sociology of Economics: What is Sociological about the Sociology of Economics? Some Recent Developments,” What is Sociological about the Sociology of Economics? Some Recent Developments,” Economic Sociology: European Electronic NewsletterEconomic Sociology: European Electronic Newsletter 4, no. 2 (2003): 32. 4, no. 2 (2003): 32. FourcadeFourcade in in the notthe notes section of her article mentions the names es section of her article mentions the names like “Maloney, 1985; Koot, 1987; like “Maloney, 1985; Koot, 1987; Kadish, 1982; 1989; Middleton, 1998. A collective effort by distinguished historians of Kadish, 1982; 1989; Middleton, 1998. A collective effort by distinguished historians of economics also provided us with five volumes on the history of the institutionalization economics also provided us with five volumes on the history of the institutionalization

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

stantiality of nation

stantiality of nation--based studies regarding economic ideas is enunci-based studies regarding economic ideas is enunci-ated by Almodovar and Cardoso in the following words: ated by Almodovar and Cardoso in the following words:

Firstly, it is the only way to deal with the spread

Firstly, it is the only way to deal with the spread and internation-and internation-al flow of economic theories, practices and doctrines. Secondly, it al flow of economic theories, practices and doctrines. Secondly, it is an approach that provides information about certain im-is an approach that provides information about certain im-portant driving forces behind the research path followed by past portant driving forces behind the research path followed by past authors, therefore helping to reshape some of the authors, therefore helping to reshape some of the existing per-existing per-ceptions of the growth of economic knowledge. Lastly, we can of ceptions of the growth of economic knowledge. Lastly, we can of course learn some historical facts pertaining to the nation we course learn some historical facts pertaining to the nation we choose to use as the standpoint for our inquiry.choose to use as the standpoint for our inquiry.23

In line with the prominence of these advantages, new researches

In line with the prominence of these advantages, new researches maimainly focus on the evolution of economic thought within national nly focus on the evolution of economic thought within national boundaries instead of a history of economics with universal claims. boundaries instead of a history of economics with universal claims. Contrary to the prevalently accepted assumption that economics is Contrary to the prevalently accepted assumption that economics is universal with universally shared values; the crossuniversal with universally shared values; the cross--nationanational varia-l varia-tions and the interaction of its practitioners with different social and tions and the interaction of its practitioners with different social and political contexts started to be taken into consideration. Marion political contexts started to be taken into consideration. Marion Fourcade who carries on studies in this direction explicates the rea-Fourcade who carries on studies in this direction explicates the rea-sons behind the potential differences betwsons behind the potential differences between various countries as een various countries as “(1) the timing and nature of the institutionalization of an economic “(1) the timing and nature of the institutionalization of an economic knowledge fields, (2) the forms of professional action of economists knowledge fields, (2) the forms of professional action of economists

of the discipline in different countries at the end of the nineteenth century. (Barber, the discipline in different countries at the end of the nineteenth century. (Barber, 1993 on the United States; Waszek, 1988 on Germany; Kadish and Tribe, 1993 on the 1993 on the United States; Waszek, 1988 on Germany; Kadish and Tribe, 1993 on the United Kingdom; Sugiyama and Mizuta, 1988 on Japan; LeVanUnited Kingdom; Sugiyama and Mizuta, 1988 on Japan; LeVan--Lemesle, 1991 onLemesle, 1991 on France)France).. AlsoAlso see Guillén, 1989, on Spain. Pioneering works in this area include see Guillén, 1989, on Spain. Pioneering works in this area include Schumpeter's History of Economic Analysis (1954), which, if centered around the Schumpeter's History of Economic Analysis (1954), which, if centered around the discussion of analytical progress in economics, nonetheless offers detailed insights discussion of analytical progress in economics, nonetheless offers detailed insights into the historical (bointo the historical (both institutional and intellectual) context of economic discourse. th institutional and intellectual) context of economic discourse. Finally, see Whitley (1984, 1987) and Coats (1993) for efforts to offer a sociological Finally, see Whitley (1984, 1987) and Coats (1993) for efforts to offer a sociological theory of the development of Anglotheory of the development of Anglo--Saxon economics.”Saxon economics.” Ibid., 35.Ibid., 35.

23 Almodovar and Cardoso, Almodovar and Cardoso, A HistoA History of Portuguesery of Portuguese, 1., 1.

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and (3) intellectual traditions in the discipline of economics”

and (3) intellectual traditions in the discipline of economics”24, all of , all of which constitute thwhich constitute the building blocks of the unique experience in each e building blocks of the unique experience in each country.country.

If we mention the differentiations between the institutionaliza-

If we mention the differentiations between the institutionaliza-tion processes of the economic science, we should also emphasize on tion processes of the economic science, we should also emphasize on the professionalization of economics and the roles of economists the professionalization of economics and the roles of economists in in societies. Fourcade in her societies. Fourcade in her Economists and SocietiesEconomists and Societies elaborates on how elaborates on how economists saw themselves and the aims of their discipline based on economists saw themselves and the aims of their discipline based on culturally specific assumptions since the end of the nineteenth centu-culturally specific assumptions since the end of the nineteenth centu-ry by adopting an externalist perspective. Metry by adopting an externalist perspective. Methodologically, she re-hodologically, she re-lies on both the objective and subjective source, paying attention to lies on both the objective and subjective source, paying attention to the statistical and institutional data on the number of people official-the statistical and institutional data on the number of people official-ly considered as economists, making interviews with French, British, ly considered as economists, making interviews with French, British, German and American econoGerman and American economists, examining the impact and compe-mists, examining the impact and compe-tence of the state within which they were produced.tence of the state within which they were produced.

In addition to Fourcade’s research on these three core countries,

In addition to Fourcade’s research on these three core countries, it is also important to see what was happening in the periphery con-it is also important to see what was happening in the periphery con-currently because there exist usefcurrently because there exist useful hints that can be grasped from a ul hints that can be grasped from a nationnation--based study of economic ideas with the assumption that there based study of economic ideas with the assumption that there might still be a widespread unawareness of what is going on in nonmight still be a widespread unawareness of what is going on in non--English speaking countriesEnglish speaking countries. Sarah Babb’s . Sarah Babb’s Managing MexicoManaging Mexico interprets interprets how the how the constructconstruction of economics expertiseion of economics expertise reflectreflectss the footprints the footprints of the institutional framework under a particular national systemof the institutional framework under a particular national system with a special emphasis onwith a special emphasis on a a universityuniversity, an institute and a research , an institute and a research centercenter. . UUnderstanding the footprints of transformation of the disci-nderstanding the footprints of transformation of the disci-plipline into a professionalized occupationne into a professionalized occupation brings about new insights in brings about new insights in revealing how economic policies are influenced both by domestic and revealing how economic policies are influenced both by domestic and international flows.international flows. Babb emphasizes on the central role of stateBabb emphasizes on the central role of state--society relations within the national trajectorysociety relations within the national trajectory, which, which would carry would carry out significant clues for a similar process in other developing re-out significant clues for a similar process in other developing re-

24 Marion FourcadeMarion Fourcade--GourinchasGourinchas, “Politic, “Politicss, Institutional Structures and the Rise of , Institutional Structures and the Rise of Economics: A Comparative StudyEconomics: A Comparative Study,,”” Theory and Society Theory and Society 30, no. 3 (2001):30, no. 3 (2001): 398.398.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

gions

gions..25 Another book on a developing country is Antonio Almodovar Another book on a developing country is Antonio Almodovar and Jose Luis Cardoso’s and Jose Luis Cardoso’s A History of Portuguese Economic Thought,A History of Portuguese Economic Thought, which which offers a panorama of the development ofoffers a panorama of the development of economic thought in economic thought in Portugal based on its peculiaritiesPortugal based on its peculiarities, for the last five centuries. , for the last five centuries. In tIn this his book, the authors elaborate on the dissemination of economic doc-book, the authors elaborate on the dissemination of economic doc-trines and theoriestrines and theories –– particularly the theories of Smith, Jevons, particularly the theories of Smith, Jevons, Walras, Pareto and KeynesWalras, Pareto and Keynes –– andand elaborateelaborate comparativelycomparatively on how all on how all these were assimilated by the Portuguese authors in various periods. these were assimilated by the Portuguese authors in various periods. Although it is not the one and only subject of their work, they con-Although it is not the one and only subject of their work, they con-centrate on the institutionalization of economics in Portugal by illus-centrate on the institutionalization of economics in Portugal by illus-trating the trtrating the trends in universities with a special emphasis on the ends in universities with a special emphasis on the teaching of political economy/economic science, textbooks and other teaching of political economy/economic science, textbooks and other published material by the local pioneer figures as well. What is also published material by the local pioneer figures as well. What is also mentionable in this study is that the authors appraise their work mentionable in this study is that the authors appraise their work both as a contribution and a challenge to the historiographical tradi-both as a contribution and a challenge to the historiographical tradi-tiontion26, not something of interest only for the examination of the cul-, not something of interest only for the examination of the cul-tural history in a specific country. This appraisal is strengthened with tural history in a specific country. This appraisal is strengthened with the argument that these translations of books the argument that these translations of books and articles, quota-and articles, quota-tions from various authors all interlink the nations.tions from various authors all interlink the nations.27..

Although Almodovar

Although Almodovar and Cardosoand Cardoso’s book remunerates the signifi-’s book remunerates the signifi-cance of the textbooks in history of economics, Bob Coatscance of the textbooks in history of economics, Bob Coats,, who is who is acknowledged as a acknowledged as a founding figure of institutionalist founding figure of institutionalist approach in approach in sociology of economicssociology of economics,, in his classic in his classic book book The Sociology and Profes-The Sociology and Profes-sionalization of Economicsionalization of Economicss previouslypreviously assertasserteded that that ““the evolution of the evolution of the economics textbooks, including the competition between rival the economics textbooks, including the competition between rival texts has been much neglected by historiatexts has been much neglected by historians of economics.ns of economics.””28 Howev-Howev-

25 Sarah Babb, Sarah Babb, Managing Mexico: Economists from Nationalism to NeoliberManaging Mexico: Economists from Nationalism to Neoliberalism alism (Princeton: Princeton University Press, 2001), xiv.(Princeton: Princeton University Press, 2001), xiv.

26 Almodovar Almodovar and Cardoso, and Cardoso, A History of PortugueseA History of Portuguese, 6, 6..

27 IbidIbid.., 3, 3..

28 A. W. Bob Coats, A. W. Bob Coats, The Sociology and Professionalization of Economics: British and The Sociology and Professionalization of Economics: British and American Economic Essays vol II,American Economic Essays vol II, (Taylor a(Taylor and Francis end Francis e--library, 2005), 17. This book library, 2005), 17. This book was first published in (London and New York: Routledge, 1993)was first published in (London and New York: Routledge, 1993)

Ş E B N E M G E L M E D İ

er, it is important to note that this tradition began to change by new

er, it is important to note that this tradition began to change by new research. For instance, a recently published edited book namely research. For instance, a recently published edited book namely The The Economic ReaderEconomic Reader by Massimo Augello and Marco Guidi, offers a series by Massimo Augello and Marco Guidi, offers a series of inquiries on the disseof inquiries on the dissemination of economics through textbooks mination of economics through textbooks utilized in various countries. Instead of a social or cultural point of utilized in various countries. Instead of a social or cultural point of view, their research focuses on this genre from the vantage point of view, their research focuses on this genre from the vantage point of the institutional approach to the history of economics with the claim the institutional approach to the history of economics with the claim that that “textbooks created the economic agent, an agent and a facilitator “textbooks created the economic agent, an agent and a facilitator of the selfof the self--government of society”.government of society”.29 In their study, they begin with In their study, they begin with the circulation of scholarsthe circulation of scholars and thenand then present the educational ap-present the educational ap-proaches and the theories in addition to the institutionalproaches and the theories in addition to the institutional models models which depict the common trends extracted from different national which depict the common trends extracted from different national cases.cases.30 Their stress on the importance of the textbooks in serving for Their stress on the importance of the textbooks in serving for a broader understanding of the intellectual and social functions of a broader understanding of the intellectual and social functions of the economic theory.the economic theory.31 They claim that embarkThey claim that embarking upon such an ap-ing upon such an ap-proach offers a promising perspective for a deep understanding of proach offers a promising perspective for a deep understanding of the specific nature of economic science the specific nature of economic science –– involving a variety of social involving a variety of social actors and stakesactors and stakes –– as a product of social construction that evolves as a product of social construction that evolves through time in a complex instthrough time in a complex institutional context.itutional context.32

29 Massimo M. Augello, and Marco E. L. GuidiMassimo M. Augello, and Marco E. L. Guidi,, eds. eds. The Economic Reader: Textbooks, The Economic Reader: Textbooks, Manuals and the Dissemination of the Economic Sciences During the 1Manuals and the Dissemination of the Economic Sciences During the 199thth Century and Century and Early 20Early 20thth centuriescenturies ((Routledge Studies in the History of Economics, 2012Routledge Studies in the History of Economics, 2012),), 33..

30 IbidIbid.., 2, 2..

31 IbidIbid.., 1, 1..

32 IbidIbid.., 4, 4.. FFor a or a detailed detailed scan on the introduction to economics textbooks in Turkeyscan on the introduction to economics textbooks in Turkey, see , see Dinç Alada and İdris Akkuzu’s article in the 527. issue of the journal Dinç Alada and İdris Akkuzu’s article in the 527. issue of the journal İktisatİktisat. In their . In their analysis, they consider the emergence of this division between economieanalysis, they consider the emergence of this division between economie--politique and politique and science of economics as a natural process instead of a radical break due to the pscience of economics as a natural process instead of a radical break due to the pro-ro-gressive evolution of economic ideas and they claim that the economics textbooks gressive evolution of economic ideas and they claim that the economics textbooks reflected this natural progress encapsulating both the political economy and the sci-reflected this natural progress encapsulating both the political economy and the sci-ence of economics views, disregarding the distinction between the two when focusing ence of economics views, disregarding the distinction between the two when focusing on econ economics. This perception is mentioned to be existent since Cavit Bey’s book tillonomics. This perception is mentioned to be existent since Cavit Bey’s book till the 1960s, Hazım Atıf Kuyucak’s the 1960s, Hazım Atıf Kuyucak’s İktisat Dersleriİktisat Dersleri and Feridun Ergin’s and Feridun Ergin’s İktisatİktisat. After this . After this period of time, theperiod of time, the authorsauthors observe that the mainstream textbooks are full of the neo-observe that the mainstream textbooks are full of the neo-classical synthesis which adapted the Keynesian ideas that are mostly developed inclassical synthesis which adapted the Keynesian ideas that are mostly developed in the the

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

All these books and articles mentioned above haAll these books and articles mentioned above haveve brought brought about eyeabout eye--opening inferences for this dissertation both in methodo-opening inferences for this dissertation both in methodo-logically and contextually.logically and contextually.33 Nevertheless, the material regarding the Nevertheless, the material regarding the evolution of the economic thoughevolution of the economic thought in our country might even have t in our country might even have more importance in determination of the extent and the boundaries more importance in determination of the extent and the boundaries for this study. In parallel with the increasing curiosity on this issue at for this study. In parallel with the increasing curiosity on this issue at the global scale, academics began to draw interest in understanding the global scale, academics began to draw interest in understanding the multiple fthe multiple facets of economic thought evolved in Turkey within acets of economic thought evolved in Turkey within different perspectives. As for the recent material ondifferent perspectives. As for the recent material on thethe history of history of economic thought in Turkey, we should first mention the studies of economic thought in Turkey, we should first mention the studies of İktisadi Düşünce Girişimiİktisadi Düşünce Girişimi (The Turkish Initiative for Economic (The Turkish Initiative for Economic Thought)Thought). . A recent edited book A recent edited book TTüürkiye’de İktisadi Düşünce rkiye’de İktisadi Düşünce elabo-elabo-rates on the various fields of the issue within an interdisciplinary rates on the various fields of the issue within an interdisciplinary viewpoint. In the very first article of the book in which Eyviewpoint. In the very first article of the book in which Eyüp Özveren üp Özveren conveys his observations on the history of economic thought in Tur-conveys his observations on the history of economic thought in Tur-key, it is mentioned that most of the studies about the economic key, it is mentioned that most of the studies about the economic thought concentrate on the Ottoman era, even not feeling the need to thought concentrate on the Ottoman era, even not feeling the need to concern with the concern with the RRepublican era. One of the pepublican era. One of the probable reasons that robable reasons that

General Theory

General Theory, combined with the neoclassical economics. By the very first transla-, combined with the neoclassical economics. By the very first transla-tion of Paul Samuelson’s tion of Paul Samuelson’s EconomicsEconomics by Demir Demirgil and widespread instruction of by Demir Demirgil and widespread instruction of the book, the idea that the only reasonable school of economics is the neoclassical the book, the idea that the only reasonable school of economics is the neoclassical sschool became dominant among the introduction to economics textbooks which somehow excluded the political economy perspectives. İdris Akkuzu and and A. Dinç Ala-da; “Türkiye’de YYayınlanan ‘İktisada Giriş’ Ders Kitaplarında İktisat’ı Aramak,,” ” İktisat DergiDergisisi, no. 527 , no. 527 (2014)(2014): : 33--1616..

33 For other books and articles regarding this issue see also Keith Tribe ed., For other books and articles regarding this issue see also Keith Tribe ed., Economic Economic Careers: Economics and Economists in Britain 1930Careers: Economics and Economists in Britain 1930--19701970 (Routledge, 1997)(Routledge, 1997).., Harry G. , Harry G. Johnson, “National Styles in Economic Research: The US, TJohnson, “National Styles in Economic Research: The US, The UK, Canada and various he UK, Canada and various European CountriesEuropean Countries,,” 1973., E. Roy Weintraub “Telling the Story of MIT Economics in ” 1973., E. Roy Weintraub “Telling the Story of MIT Economics in the Postthe Post--war Periodwar Period””..,, M. Brazer, “The Economics Department of the University of M. Brazer, “The Economics Department of the University of Michigan a Centennial Retrospective” in Michigan a Centennial Retrospective” in Economics and the World AEconomics and the World Around It round It (University (University of Michigan Press, 1982). A. W. Bob Coats ed., of Michigan Press, 1982). A. W. Bob Coats ed., The Development of Economics in West-The Development of Economics in West-ern Europe since 1945ern Europe since 1945 (London: Routledge, 2000)., David Colander and Arjo Klamer, (London: Routledge, 2000)., David Colander and Arjo Klamer, “The Making of an Economist“The Making of an Economist,,” ” The Journal of Economic Perspectives The Journal of Economic Perspectives 1, 1, no. 2 (Autumn, no. 2 (Autumn, 1987):1987): 9595--111.111.

Ş E B N E M G E L M E D İ

retards the interest in the

retards the interest in the RRepublican period as identified by Özveren epublican period as identified by Özveren is the deepness of the research field which embodies a long period. is the deepness of the research field which embodies a long period. The second reason for him is the impression/assumption that the The second reason for him is the impression/assumption that the economic thought in economic thought in RRepublican eepublican era is not original, it is “imported” ra is not original, it is “imported” and “lagged behind”.and “lagged behind”.34

In parallel with the fixation of Özveren, while researching on the ex-

In parallel with the fixation of Özveren, while researching on the ex-isting literature that foregrounds the roles of intellectual elites and edu-isting literature that foregrounds the roles of intellectual elites and edu-cation in understanding peculiarities of the history cation in understanding peculiarities of the history of economic thought of economic thought at loat local level, I was also confronted more with the works that are cal level, I was also confronted more with the works that are grounded in the late Ottoman era. The work of Deniz T. Kılınçoğlu was grounded in the late Ottoman era. The work of Deniz T. Kılınçoğlu was one of these, namely one of these, namely The Political Economy of Ottoman Modernity: Otto-The Political Economy of Ottoman Modernity: Otto-man Economic Thought During the Reign of Abdülhamid II man Economic Thought During the Reign of Abdülhamid II (1876(1876--19091909). ). The main emphasis in Kılınçoğlu’s dissertation is that the economic The main emphasis in Kılınçoğlu’s dissertation is that the economic thought was used and interpreted by the intellectual elites in their quest thought was used and interpreted by the intellectual elites in their quest forfor waysways to save the empire from to save the empire from collapsecollapse at the era of the capitalist at the era of the capitalist modernity.modernity.35 With the intentioWith the intention of contextualizing intellectuals and the n of contextualizing intellectuals and the production of their ideas, Kılınçoğlu pays attention to the power of the production of their ideas, Kılınçoğlu pays attention to the power of the social and cultural spheres in shaping the economic sphere.social and cultural spheres in shaping the economic sphere.36 After pre-After pre-senting a literature review that comprehends the evolution of Ottoman senting a literature review that comprehends the evolution of Ottoman economy and economic thought in between the late eighteenth century economy and economic thought in between the late eighteenth century and the 1908 revolution, he examines the economic literature produced and the 1908 revolution, he examines the economic literature produced by the key figures during the reign of Abdülhamid II, focusing on the by the key figures during the reign of Abdülhamid II, focusing on the debate between free trade and protectionism. He debate between free trade and protectionism. He then analyzes on the then analyzes on the “social question” utilizing the meaning as the issues of identity and the “social question” utilizing the meaning as the issues of identity and the social vision of the Ottomanssocial vision of the Ottomans..37 In the following parts, he presents the In the following parts, he presents the evolution of the nationalist discourse and works on a selection of novels evolution of the nationalist discourse and works on a selection of novels

34 Eyüp Eyüp ÖzverenÖzveren, , “İster İstemez Karşılaştırmalı ve Dışa Bağımlı İktisadi Düşünce “İster İstemez Karşılaştırmalı ve Dışa Bağımlı İktisadi Düşünce Tarihimiz: Gözlemler ve SorunlarTarihimiz: Gözlemler ve Sorunlar,,” in ” in Türkiye’de İktisadi DüşünceTürkiye’de İktisadi Düşünce, eds. M. Erdem Özgür, , eds. M. Erdem Özgür, Alper Duman, Alp Yücel Kaya (İstanbul: İletişim YayınlarAlper Duman, Alp Yücel Kaya (İstanbul: İletişim Yayınları, 2017),ı, 2017), 2727..

35 Deniz T. Kılınçoğlu, Deniz T. Kılınçoğlu, ““The Political Economy of Ottoman Modernity: Ottoman Economic The Political Economy of Ottoman Modernity: Ottoman Economic Thought During the Reign of Abdülhamid II (1876Thought During the Reign of Abdülhamid II (1876--1909)”,1909)”, PhD diss., (Princeton Uni-PhD diss., (Princeton Uni-versity, 2012): versity, 2012): 1212--1313..

36 IbidIbid.., 6, 6..

37 IbidIbid..,, 1135.35.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

in pursuit of f

in pursuit of framing the social and cultural representations during the raming the social and cultural representations during the Abdülhamid II era. In this “continuous evolutionary process of social, Abdülhamid II era. In this “continuous evolutionary process of social, economic and political change”economic and political change”38,, he comes up with a conclusion that he comes up with a conclusion that Ottoman intellectuals, instead of imitating everything, havOttoman intellectuals, instead of imitating everything, have chosen to e chosen to adopt concepts and institutions pragmatically.adopt concepts and institutions pragmatically.39

A study regarding the educational field in the Ottoman Empire was

A study regarding the educational field in the Ottoman Empire was the master thesis of Levent Engin, “Ottoman Teaching of Modern Eco-the master thesis of Levent Engin, “Ottoman Teaching of Modern Eco-nomics from the Mülkiye School to the Faculty of Economics 1878nomics from the Mülkiye School to the Faculty of Economics 1878--1936”. In the thesis, Engin aims to present the methodological perspec-1936”. In the thesis, Engin aims to present the methodological perspec-tives of the academics in the given period, their approach vistives of the academics in the given period, their approach vis--àà--vis the vis the issues in accordance with the need of modernization and their studies issues in accordance with the need of modernization and their studies on economic policies; all of which have cruon economic policies; all of which have crucial importance in under-cial importance in under-standing the science of economics and social thought. After a discussion standing the science of economics and social thought. After a discussion about the traditional meaning of economics, the social and economic about the traditional meaning of economics, the social and economic thought in Ottoman Empire, he examines the evolution of the modern thought in Ottoman Empire, he examines the evolution of the modern thinking in Europe. Withthinking in Europe. Within this context, he attempts to highlight the in this context, he attempts to highlight the place of teaching of modern economics, keeping in mind the interactive place of teaching of modern economics, keeping in mind the interactive relation there exists between them. What Engin observes during his relation there exists between them. What Engin observes during his research is that the Ottoman intellectuals investigated for the new ave-research is that the Ottoman intellectuals investigated for the new ave-nnues in social and economic thought, and this investigation is of critical ues in social and economic thought, and this investigation is of critical importance in the development process of the Turkish Republic.importance in the development process of the Turkish Republic.40

A broader perspective on the modernization of Ottoman economic

A broader perspective on the modernization of Ottoman economic thought can be seen in Ahmed Güner Sayar’s thought can be seen in Ahmed Güner Sayar’s Osmanlı İktisat Düşüncesin-Osmanlı İktisat Düşüncesin-in Çağdaşlaşması. in Çağdaşlaşması. Sayar in this book seeks answers for the question why Sayar in this book seeks answers for the question why the Ottomans were not able to produce modern economics standards. the Ottomans were not able to produce modern economics standards. He attracts the attentionHe attracts the attention toto the ideological depression the Ottoman in-the ideological depression the Ottoman in-tellectuals fell into tellectuals fell into as well as blending a series of oldas well as blending a series of old--style concepts into style concepts into the new model while internalizing the modern economic thought. In the the new model while internalizing the modern economic thought. In the

38 IbidIbid.., 13, 13..

39 IbIbidid..,, 28281.1.

40 LeventLevent Engin, “Engin, “Ottoman Teaching of Modern Economics from the Mülkiye School to the Ottoman Teaching of Modern Economics from the Mülkiye School to the Faculty of Economics 1878Faculty of Economics 1878--19361936,,” Master’s thesis, (Boğaziçi University, 1991): ab-” Master’s thesis, (Boğaziçi University, 1991): ab-stract.stract.

Ş E B N E M G E L M E D İ

first part

first part,, he investigates the mutual interaction between the economic he investigates the mutual interaction between the economic principles sustained by principles sustained by ilmilm--i tedbiri tedbir--i devlet i devlet approach andapproach and the mentality the mentality of Ottoman individual since the classical period till the Tanzimat Era. In of Ottoman individual since the classical period till the Tanzimat Era. In the second part of the book, he examines the linkages between the indi-the second part of the book, he examines the linkages between the indi-vidual who began to be crystallized by the Tanzimat Era, with the eco-vidual who began to be crystallized by the Tanzimat Era, with the eco-nomic thought produced in tnomic thought produced in the West and its representatives. Sayar puts he West and its representatives. Sayar puts Tanzimat as a milestone in transition to individualization mentioning Tanzimat as a milestone in transition to individualization mentioning that the developments afterwards laid the groundwork for a transfor-that the developments afterwards laid the groundwork for a transfor-mation and reapproachment in the state society relations. As the Otto-mation and reapproachment in the state society relations. As the Otto-man ecman economic thought encompassed and abided by the Western onomic thought encompassed and abided by the Western thought both in positive and normative senses, the debates on who thought both in positive and normative senses, the debates on who would carry out the economy brought about the polarization in eco-would carry out the economy brought about the polarization in eco-nomic policy making processes.nomic policy making processes.41 Sayar in his book is nourished by the Sayar in his book is nourished by the mementality research legacy of Sabri Ülgener and elaborated the issue in ntality research legacy of Sabri Ülgener and elaborated the issue in that vein.that vein.

Indeed, there are various methods adopted in the history of econom-

Indeed, there are various methods adopted in the history of econom-ic thought analysis in our country and Özveren sets forth three of the ic thought analysis in our country and Özveren sets forth three of the prominent approaches. The first one is prominent approaches. The first one is the previously mentioned “eco-the previously mentioned “eco-nomic mentality” approachnomic mentality” approach,, which attempts to see the discrepancies which attempts to see the discrepancies between the evolution of the economic thought in the West and Turkey between the evolution of the economic thought in the West and Turkey within the lenses of the reminiscent mentality patterns. In this way of within the lenses of the reminiscent mentality patterns. In this way of analysis, the vitalanalysis, the vital fact occurs as the division between “us” and “them”.fact occurs as the division between “us” and “them”.42 This approach, nurtured by the analysis of Max Weber and Werner This approach, nurtured by the analysis of Max Weber and Werner Sombart, who gave particular importance to ideological part, the deci-Sombart, who gave particular importance to ideological part, the deci-siveness of mentality and economic spirit in understanding the organsiveness of mentality and economic spirit in understanding the organi-i-zation of modern capitalismzation of modern capitalism43 typically utilized by Sabri Ülgener, a mile-typically utilized by Sabri Ülgener, a mile-stonestone academic figureacademic figure in the Faculty of Economics. Indeed, this method in the Faculty of Economics. Indeed, this method is quite useful in understanding the key facts in Turkey, especially for is quite useful in understanding the key facts in Turkey, especially for

41 Ahmet Güner SayarAhmet Güner Sayar,, Osmanlı İktisat Düşüncesinin ÇağdaşlaşmasıOsmanlı İktisat Düşüncesinin Çağdaşlaşması (İst(İstanbul: Ötüken anbul: Ötüken Yayınları, 2013),Yayınları, 2013), 1010--1111..

42 Özveren, “İster İstemez KarşılaştırmalıÖzveren, “İster İstemez Karşılaştırmalı,,” 28” 28..

43 ÖzgürÖzgür andand KayaKaya,, ““KadroKadro’nun Maddeci Tarihyazımı: Osmanlı ve Türkiye Tarihinde ’nun Maddeci Tarihyazımı: Osmanlı ve Türkiye Tarihinde Derebeylik RejimiDerebeylik Rejimi,,” in ” in Türkiye’de İktisadi DüşünceTürkiye’de İktisadi Düşünce, , 207207..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

the analysis on the potential reasons o

the analysis on the potential reasons of underdevelopment and ongoing f underdevelopment and ongoing patterns regarding economic behavior. The patterns regarding economic behavior. The continuitiescontinuities come to the fore come to the fore in this regard, principally the firm patterns and mental reminiscent of in this regard, principally the firm patterns and mental reminiscent of the past. So, as Özveren puts it, this approach is wired into the history the past. So, as Özveren puts it, this approach is wired into the history and traand tradition of the Ottomans.dition of the Ottomans.44 Yet, Yet, as argued by Özveren, as argued by Özveren, one should one should keep in mind that identifying a representative mentality is not an easy keep in mind that identifying a representative mentality is not an easy job in a cosmopolitan structure.job in a cosmopolitan structure. Although very functional and verifiable Although very functional and verifiable by the phenomenon in Turkey most of the time, thby the phenomenon in Turkey most of the time, there is the risk of miss-ere is the risk of miss-ing out the reality that the economic behaviors induced by mentalities ing out the reality that the economic behaviors induced by mentalities themselves are redetermined in an institutional framework as well.themselves are redetermined in an institutional framework as well.45

Another approach Özveren remarks for our country is the national

Another approach Özveren remarks for our country is the national histories of economic thoughthistories of economic thought which was indicated as an increasing which was indicated as an increasing trend in the previous paragraphs. The trademark of this approachtrend in the previous paragraphs. The trademark of this approach for for himhim is that it conceives the formation process of a nation state in rela-is that it conceives the formation process of a nation state in rela-tion with the genesis of economic thought. In this regard, the critical tion with the genesis of economic thought. In this regard, the critical role role of economic policies in the evaluation of economic thought is pri-of economic policies in the evaluation of economic thought is pri-marily considered.marily considered.46 This method is also useful for this dissertation This method is also useful for this dissertation since the period addressed in this study begins with the early years of since the period addressed in this study begins with the early years of the new the new RRepublican regime during when the urgent nepublican regime during when the urgent need for recon-eed for recon-structing the institutional framework made itself apparent and econom-structing the institutional framework made itself apparent and econom-ic policies aiming developmental goals shaped the educational concerns ic policies aiming developmental goals shaped the educational concerns to some extent. Yet, Özveren attracts the attention to the risk of excess to some extent. Yet, Özveren attracts the attention to the risk of excess abstraction and simplificatioabstraction and simplification that might stem from application of this n that might stem from application of this method, by overlooking the appearances of the different ecoles in a method, by overlooking the appearances of the different ecoles in a country.country.47

Lastly, he touches upon the method to be employed in this study as

Lastly, he touches upon the method to be employed in this study as well, which he also uses in his own work, that is the approach of “dwell, which he also uses in his own work, that is the approach of “dis-is-semination of ideas”. semination of ideas”. TThe reasons that entail the application of such an he reasons that entail the application of such an approach which highlights the mutual interaction between the ideasapproach which highlights the mutual interaction between the ideas

44 Özveren, “İster İstemez Özveren, “İster İstemez KarşılaştırmalıKarşılaştırmalı,,” 28” 28..

45 Ibid., Ibid., 1313..

46 IbidIbid..,, 2929..

47 IbIbiidd.., 31, 31..

Ş E B N E M G E L M E D İ

was mentioned

was mentioned; however, maybe it is even more useful for our country ; however, maybe it is even more useful for our country in which an established school of economic thin which an established school of economic thought isought is/was/was absent. absent. Here, Here, explorexploration onation on the fluidity occurs as the object of analysis. In the the fluidity occurs as the object of analysis. In the words of Özveren, “economic thought is disguised, it undergoes chang-words of Özveren, “economic thought is disguised, it undergoes chang-es. In fact, it is not only the economic thoughes. In fact, it is not only the economic thoughtt that appears as the matter that appears as the matter of change, but aof change, but also the approaches and methods, and even the econo-lso the approaches and methods, and even the econo-mists mists that are that are subjectsubjecteded to immigration and exile.”to immigration and exile.”48 The last part of this The last part of this statement is even more important for this study in the sense that the statement is even more important for this study in the sense that the starting point of this dissertation is determined as the founstarting point of this dissertation is determined as the foundation of the dation of the Faculty of Economics in Istanbul University and the emergence of a new Faculty of Economics in Istanbul University and the emergence of a new disciplinary framework by the arrival of the émigré economists escap-disciplinary framework by the arrival of the émigré economists escap-ing from the Nazi regime in the 1930s. The evolution of economics dis-ing from the Nazi regime in the 1930s. The evolution of economics dis-cipline from the 1930s till the 19cipline from the 1930s till the 1960s, during when the discipline was 60s, during when the discipline was under the influence of many social and political factors under the influence of many social and political factors –– both inside both inside and outsideand outside –– would hopefully reflect the impacts of the theoretical in-would hopefully reflect the impacts of the theoretical in-teractioteractions;ns; although this might be described as although this might be described as an “inequivalent ex-an “inequivalent ex-change”change”49 inin the case of Turkey.the case of Turkey.

The 30

The 30--35 year35 yearss time interval between the 1930s and time interval between the 1930s and the the 1960s is 1960s is appointed for appointed for this this research by several reasonsresearch by several reasons. T. The major reason is the he major reason is the rareness of the studies that concentrate on the formation of economics. rareness of the studies that concentrate on the formation of economics. This period, during when mThis period, during when multiple factors played cultiple factors played crucialrucial roles, repre-roles, repre-sents a blurred area, from the foundation of the faculty of economics till sents a blurred area, from the foundation of the faculty of economics till the new mainstream the new mainstream wawas established by the neoclassical synthesis. A s established by the neoclassical synthesis. A detailed textual analysis on the university publications detailed textual analysis on the university publications duringduring that that bblurred era, is expected to provide clues about the political, social, eco-lurred era, is expected to provide clues about the political, social, eco-nomic, cultural even psychological underpinnings of the society as well nomic, cultural even psychological underpinnings of the society as well as the formation of economic thinking as as the formation of economic thinking as itit appearappearss in the in the academic academic fieldfield. .

Apart from this central reason behi

Apart from this central reason behind the choice of this nd the choice of this time inter-time inter-valval, , the emergence of the emergence of significant changessignificant changes in the global contextin the global context during during this period which this period which both encapsulatesboth encapsulates thethe years from the years from the “age of disaster” “age of disaster”

48 IbIbiidd.., 30, 30..

49 This term is coined by ÖzverenThis term is coined by Özveren. . IIbidbid.., 32, 32..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

and “the golden age of capitalism” in Hobsbawm’s words

and “the golden age of capitalism” in Hobsbawm’s words, also generated , also generated a a curiosicuriosity for ty for further research on further research on that era.that era.50 Within this period, we Within this period, we witnessed the fall of liberalism, the rise of authoritarianism, the efforts witnessed the fall of liberalism, the rise of authoritarianism, the efforts to easto ease the pain stemming from the Great Depression in 1929 for econ-e the pain stemming from the Great Depression in 1929 for econ-omies and a major catastrophe of the Second World Womies and a major catastrophe of the Second World War. The hegemony ar. The hegemony of Europe was already shaken by the destruction of the First World War, of Europe was already shaken by the destruction of the First World War, but it was certainly switched over to the USA since the second. In a po-but it was certainly switched over to the USA since the second. In a po-larized world, restructuring the global economic order with new con-larized world, restructuring the global economic order with new con-cerns based on the Cold War dcerns based on the Cold War dynamics cynamics caame to the forefront. The me to the forefront. The Keynesian precepts that recommended state intervention to economy Keynesian precepts that recommended state intervention to economy whenwhen aa selfself--regulating market remains insufficient in solving the eco-regulating market remains insufficient in solving the eco-nomic problems and providing full employment were taken into consid-nomic problems and providing full employment were taken into consid-eration and welfareeration and welfare states arose in the developed world. In addition, by states arose in the developed world. In addition, by the widespread decolonization movement, developmental concerns for the widespread decolonization movement, developmental concerns for the newly found nation states came to agenda. In brief, the Second the newly found nation states came to agenda. In brief, the Second World War acted as a literal breaking point in many respects of the World War acted as a literal breaking point in many respects of the 2020thth century, it century, it might even be called asmight even be called as the most extreme incident in “the age the most extreme incident in “the age of extremes”.of extremes”.

Roger Backhouse

Roger Backhouse and Philippe Fontaineand Philippe Fontaine argue that the Wargue that the World orld WWar ar II II and the events surrounding it such as the rise of Nazi Regime and the and the events surrounding it such as the rise of Nazi Regime and the economic trauma experiencedeconomic trauma experienced in the 1930sin the 1930s,, hahaveve also changed the con-also changed the con-ceptualization of the economics discipline. Although the two prominent ceptualization of the economics discipline. Although the two prominent representatives of the competing economic prescriptions, John Maynard representatives of the competing economic prescriptions, John Maynard Keynes and Friedrich Hayek both published their magnum opus before Keynes and Friedrich Hayek both published their magnum opus before the end the end of the war, the focal point for the discipline of economics is por-of the war, the focal point for the discipline of economics is por-trayed as the Wtrayed as the World orld WWar ar II. Referring to Bernstein,II. Referring to Bernstein, Backhouse Backhouse statestates s that “the increasingly scientistic ambitions of economists served to con-that “the increasingly scientistic ambitions of economists served to con-solidate a strong disciplinary identity based on solidate a strong disciplinary identity based on their image ‘as the prac-their image ‘as the prac-titioners of a rigorous, dispassionate and apolitical disciplinetitioners of a rigorous, dispassionate and apolitical discipline’’ since since

50 Eric Hobsbawm, Eric Hobsbawm, The Age of Extremes, The Short Twentieth Century, 1914The Age of Extremes, The Short Twentieth Century, 1914--1991 1991 (US: (US: Vintage Books, 1994).Vintage Books, 1994).

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then

then””..51 DespiteDespite the efforts of a number of initiatives in pursuit of the efforts of a number of initiatives in pursuit of broadening the scope of the discipline with a concern that the discipline broadening the scope of the discipline with a concern that the discipline was ignoring issuwas ignoring issues such as inequality, poverty and discriminationes such as inequality, poverty and discrimination;; he he argues that argues that these topics remained in its periphery and the constructed these topics remained in its periphery and the constructed image of the academic neutrality by the economists was preserved.image of the academic neutrality by the economists was preserved.52 This situation is also manifested inThis situation is also manifested in Weintraub’s words: Weintraub’s words: “The rol“The role of e of models became more important, and the role of value judgments and models became more important, and the role of value judgments and ethical concerns became less important in undergraduate teaching, ethical concerns became less important in undergraduate teaching, graduate curricula, and the socialization of new entrants into the eco-graduate curricula, and the socialization of new entrants into the eco-nomics profession. The postwar period witnessed anomics profession. The postwar period witnessed a new rhetoric of new rhetoric of economics.”economics.”53

There was also shift in the center wherein the hegemonic economic

There was also shift in the center wherein the hegemonic economic knowledge was produced knowledge was produced duringduring this period. Backhouse claims this period. Backhouse claims that it that it waswas the European economics dominant in the 1920s. The generation the European economics dominant in the 1920s. The generation that had formalized economithat had formalized economics many of whom were even not alive in cs many of whom were even not alive in the 1920s was overwhelmingly European and this situation did not the 1920s was overwhelmingly European and this situation did not change till the end of the Second World War. On the other hand, by the change till the end of the Second World War. On the other hand, by the end of the war, hundreds of European economists were end of the war, hundreds of European economists were obligeobliged to emi-d to emi-grate most of grate most of whwhomom were ended up in the United States, were ended up in the United States, attaining iattaining influ-nflu-ential positions: ential positions: ““Harvard had Schumpeter Harvard had Schumpeter ((from Austriafrom Austria)) and Wassily and Wassily Leontief Leontief ((from Russia via Germanyfrom Russia via Germany))””..54 This emigration signified a criti-This emigration signified a criti-cal point in the processcal point in the process,, which eventuated by the institutiowhich eventuated by the institutionalization of nalization of the American economics into the American economics into being abeing a mainstreammainstream in economics educa-in economics educa-tion. As suggested by Weintraub, tion. As suggested by Weintraub,

only the United States had the resources to educate, hire, and

only the United States had the resources to educate, hire, and train economists, and to publish research in economics on a train economists, and to publish research in economics on a

51 Roger Roger E. E. BBackhouseackhouse and Philippe Fontaineand Philippe Fontaine,, eds.,eds., The History of The History of the the Social Sciences since Social Sciences since 19451945 (Cambridge, New (Cambridge, New York: Cambridge University Press, 2010), 6York: Cambridge University Press, 2010), 6,, cited cited inin Bernstein Bernstein (2001(2001:: 152).152).

52 IbidIbid.., 11., 11.

53 E. E. RoyRoy Weintraub, “Telling the History of MITWeintraub, “Telling the History of MIT,,” ” History of PoHistory of Political Economy 46 litical Economy 46 (Durham, N. C.: Duke University Press, 2014): 6(Durham, N. C.: Duke University Press, 2014): 6..

54 Roger E. Roger E. Backhouse, Backhouse, “Economics,” in “Economics,” in The HistoryThe History of the Social Sciences since 1945of the Social Sciences since 1945, , 38.38.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

massive scale. Over

massive scale. Over time, economics stabilized in the sense that time, economics stabilized in the sense that disparate national traditions were submerged and marginalized disparate national traditions were submerged and marginalized with respect to an American mainstream economicwith respect to an American mainstream economics.… s.… America’s America’s hegemony stabilized economic discourse by replacing various hegemony stabilized economic discourse by replacing various national traditions with thenational traditions with the emergent traditions of the American emergent traditions of the American economics community.economics community.55

Aside from the turbulences in the global context, maybe this period

Aside from the turbulences in the global context, maybe this period points out a more significant time interval for the young Turkish Repub-points out a more significant time interval for the young Turkish Repub-lic than the rest of the world. The 1930s was the decade dlic than the rest of the world. The 1930s was the decade during when uring when policies regarding the cultural dimensions of the revolution gained policies regarding the cultural dimensions of the revolution gained weight by the establishment of a renewed institutional framework. The weight by the establishment of a renewed institutional framework. The new regime with refreshed requirements depending both on internal new regime with refreshed requirements depending both on internal and external dynamics, aimed to design thand external dynamics, aimed to design the educational field under the e educational field under the guidance of wisdom and science. The university reform in 1933 and the guidance of wisdom and science. The university reform in 1933 and the foundation of the Faculty of Economics in 1936 with a readjustment on foundation of the Faculty of Economics in 1936 with a readjustment on curricular structure and a renewal of staff can be considered among the curricular structure and a renewal of staff can be considered among the prominent indiprominent indicators of the new institutional framework related with cators of the new institutional framework related with the subject matter of this dissertation. From then on, economics educa-the subject matter of this dissertation. From then on, economics educa-tion emancipated from the faculty of law by the foundation of the facul-tion emancipated from the faculty of law by the foundation of the facul-ty of economics and the curriculum was shaped by the implemety of economics and the curriculum was shaped by the implementation ntation of a methodology and substance appropriate for the nature of the eco-of a methodology and substance appropriate for the nature of the eco-nomic science. In determination of the institutional settlement and nomic science. In determination of the institutional settlement and chairs, the repercussions of the urgent need for raising generations that chairs, the repercussions of the urgent need for raising generations that would maintain the achievements of thewould maintain the achievements of the revolution with an unbending revolution with an unbending emphasis on economic independence and national economic develop-emphasis on economic independence and national economic develop-ment goal by preserving the social harmony might have played the ment goal by preserving the social harmony might have played the lead-lead-inging roles. Together with the general economics courses, subbranches roles. Together with the general economics courses, subbranches like public finance and içlike public finance and içtimai iktisat/sociologytimai iktisat/sociology--social policy occurred social policy occurred among the core constituents in the new curriculum of economics which among the core constituents in the new curriculum of economics which imply the embeddedness of the social into economics from the very be-imply the embeddedness of the social into economics from the very be-

55 WeintraubWeintraub,, “Telling the History of MIT“Telling the History of MIT,,” 7” 7..

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ginning

ginning, especially for during that initial phases of the evolution of t, especially for during that initial phases of the evolution of the he discipline. discipline.

The second point behind the choice of this period is related with a

The second point behind the choice of this period is related with a transnational facttransnational fact,, that is the emigration of that is the emigration of the the European economistsEuropean economists to to various regions.various regions. Many academics opponent to Nazi regime who could Many academics opponent to Nazi regime who could not anymore stand in their mothernot anymore stand in their motherlands were invited to Turkey in the lands were invited to Turkey in the 1930s and played 1930s and played leading leading roles inroles in thethe formation formation and evolution and evolution of of the the economics discipline in the new faculty of economics. As Istanbul Uni-economics discipline in the new faculty of economics. As Istanbul Uni-versity Faculty of Economics is manifested as the milestone in econom-versity Faculty of Economics is manifested as the milestone in econom-ics educationics education in Turkey, the significance of the émigré economists who in Turkey, the significance of the émigré economists who were around there from the very beginning of that formation process were around there from the very beginning of that formation process comes out once again. Despite being completely stranger to the local comes out once again. Despite being completely stranger to the local concerns and mentality, they made a memorable effort to be heconcerns and mentality, they made a memorable effort to be helpful for lpful for the local audience. Together with the contributions of the local profes-the local audience. Together with the contributions of the local profes-sors, they wrote textbooks that constructed the foundational base for sors, they wrote textbooks that constructed the foundational base for the general principles of economics, established a library in the univer-the general principles of economics, established a library in the univer-sity, published journal articles sity, published journal articles and organized conferences; which all and organized conferences; which all supplemented the accumulation of knowledge in economics. Although a supplemented the accumulation of knowledge in economics. Although a national school of thought with a particular substance was not generat-national school of thought with a particular substance was not generat-ed ed locallylocally, their theo, their theoretical legacyretical legacy, , together with the notable contribu-together with the notable contribu-tions of tions of thethe native native professorsprofessors,, symbolizes asymbolizes a nascence of annascence of an institutionalinstitutional tradition embracedtradition embraced by their students and successors.by their students and successors.

At the heart of the selected period lies the W

At the heart of the selected period lies the World orld WWar ar II, which also II, which also signifies a breaking point for Turkey. A primary observationsignifies a breaking point for Turkey. A primary observation on whaton what happened since thenhappened since then is thatis that,, most of émigré economists left Turkey a most of émigré economists left Turkey a few years after the end of the war. Hence, in the 1950s, the students of few years after the end of the war. Hence, in the 1950s, the students of the firstthe first--generation academics were at their predecessors’ positions as generation academics were at their predecessors’ positions as professors, whose theoretical viewpoints professors, whose theoretical viewpoints were enriched by the educa-were enriched by the educa-tional formation they gained both by studying at local and abroad. The tional formation they gained both by studying at local and abroad. The second observation on thsecond observation on thee period period after the Wafter the World orld WWar ar II showsII shows that the that the prevailing concerns in economics began to be articulated by the devel-prevailing concerns in economics began to be articulated by the devel-oping theories outsoping theories outside and changed form. The shifts in the considera-ide and changed form. The shifts in the considera-tion of the academics regarding the conceptualization of the core do-tion of the academics regarding the conceptualization of the core do-mains in economics education became palpable in line with the mains in economics education became palpable in line with the

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

changing agenda of the economy. The most salient change is the crystal-

changing agenda of the economy. The most salient change is the crystal-lizatiolization of the division between microeconomics and macroeconomics n of the division between microeconomics and macroeconomics by the increase in the recognition of Keynesian theory at the local aca-by the increase in the recognition of Keynesian theory at the local aca-demia. Indeed, it would not be wrong to say that the impact of Keynes-demia. Indeed, it would not be wrong to say that the impact of Keynes-ian themes was apparent in many facets of the economicsian themes was apparent in many facets of the economics,, particularly particularly in public finance and social policyin public finance and social policy,, even before Keynesian theory was even before Keynesian theory was regarded as a foundational base for the textbooks. Another notable regarded as a foundational base for the textbooks. Another notable change is the increasing amount of articles related with the develop-change is the increasing amount of articles related with the develop-mental concerns and a slight appearanmental concerns and a slight appearance of the Marxian vein in some of ce of the Marxian vein in some of the writings, particularly through the articles in the journal of the writings, particularly through the articles in the journal of Ankara Ankara University Faculty of Political Sciences.University Faculty of Political Sciences.

The period covered in this dissertation ends by the emergence of a

The period covered in this dissertation ends by the emergence of a new mainstream bynew mainstream by thethe translation of Patranslation of Paul Samuelson’s ul Samuelson’s EconomicsEconomics into into Turkish in 1965.Turkish in 1965.56 Although the book was published in 1948, the reper-Although the book was published in 1948, the reper-cussions of the new rhetoric in economics, namely the cussions of the new rhetoric in economics, namely the neoclassic synthe-neoclassic synthe-sissis, appeared by the appropriation of this translation as a central source , appeared by the appropriation of this translation as a central source in economicsin economics profession. This appropriation can be considered as a fo-profession. This appropriation can be considered as a fo-cal point for the paradigm shift in teaching of economics as it became cal point for the paradigm shift in teaching of economics as it became the mainstream economics textbook. Hence, this study can be character-the mainstream economics textbook. Hence, this study can be character-ized as a retrospective analysis on the blurred era which rized as a retrospective analysis on the blurred era which reflected the eflected the intertwined concerns of economics, state and institutions; and a de-intertwined concerns of economics, state and institutions; and a de-tailed story of the economics discipline from its rebirth by the founda-tailed story of the economics discipline from its rebirth by the founda-

56 Kazgan claims that the transformation in the Kazgan claims that the transformation in the curriculum of the faculty of economics curriculum of the faculty of economics based on Anglosaxon ecole came up by the new generation. This generation, endowed based on Anglosaxon ecole came up by the new generation. This generation, endowed by a new intellectby a new intellect circlecircle, consisted of Oktay Yenal, İbrahim Öngüt, Sencer Divitçioğlu, consisted of Oktay Yenal, İbrahim Öngüt, Sencer Divitçioğlu and and İdris Küçükömer. The textbooks used in Ameriİdris Küçükömer. The textbooks used in America started to be translated and as ca started to be translated and as Samuelson’s Samuelson’s Introduction to EconomicsIntroduction to Economics has arrived by Demir Demirgil, it became pos-has arrived by Demir Demirgil, it became pos-sible to ground economics on a holistic base and was a turning point for the students. sible to ground economics on a holistic base and was a turning point for the students. TheThe translattranslation of this book says Kazgan ion of this book says Kazgan shapeshapedd the the way and instruments of way and instruments of their their thinkingthinking. . Since tSince then, economics was divided into macroeconomics, microeconomics hen, economics was divided into macroeconomics, microeconomics and international economics; by the analytical tools and equations the analytical pow-and international economics; by the analytical tools and equations the analytical pow-er of education was increased. er of education was increased. Gülten Gülten Kazgan, Kazgan, Bir İktisatçınınBir İktisatçının TanıklıklarıTanıklıkları (İstanbul: (İstanbul: İstanbul Bilgi Üniversitesi Yayınları, 2009)İstanbul Bilgi Üniversitesi Yayınları, 2009), , 1515--1616..

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tion of the Faculty of Economics, till its convergence to American eco-

tion of the Faculty of Economics, till its convergence to American eco-nomics. nomics.

§ 1.2 Organization of DissertatOrganization of Dissertationion

The prior object of analysis is the formation of economics discipline in

The prior object of analysis is the formation of economics discipline in Istanbul University starting from the foundation of the Institute for Istanbul University starting from the foundation of the Institute for Economics and Sociology and Faculty of Economics. The Economics and Sociology and Faculty of Economics. The mainmain archive archive materials are the textbooks and journal amaterials are the textbooks and journal articles published by Istanbul rticles published by Istanbul University. However, for the chapters encapsulating the issues within University. However, for the chapters encapsulating the issues within which the “policy” gains importance and the “economic” is highly inter-which the “policy” gains importance and the “economic” is highly inter-twined with “social”; the material oftwined with “social”; the material of SBFSBF ((The Journal of Ankara Univer-The Journal of Ankara Univer-sity sity Faculty ofFaculty of Political Sciences)Political Sciences) is also involved in. Examining the jour-is also involved in. Examining the jour-nal of nal of SBFSBF was both expanded the domain of research by enlarging the was both expanded the domain of research by enlarging the amount of material and provided new opportunities for making com-amount of material and provided new opportunities for making com-parisons between the approaches of the two classical universitiparisons between the approaches of the two classical universities. Alt-es. Alt-hough there will be many references to the textbooks, the reader would hough there will be many references to the textbooks, the reader would notice that the content of the chapters is mainly grounded on the jour-notice that the content of the chapters is mainly grounded on the jour-nal articles. This is a deliberate choice for two reasons. First, focusing on nal articles. This is a deliberate choice for two reasons. First, focusing on journals providejournals providess a more simula more simultaneous impression on the evolutionary taneous impression on the evolutionary process while the textbooks offer a more process while the textbooks offer a more frozen frozen content. By elaborating content. By elaborating on the university journals, one can more clearly see the fluidity of ideas on the university journals, one can more clearly see the fluidity of ideas and how the academic economists kept up with the socioand how the academic economists kept up with the socio--economic economic agendaagenda of the country. In addition, the subjectivity of the economists of the country. In addition, the subjectivity of the economists would probably be more apparent in the journal articles in comparison would probably be more apparent in the journal articles in comparison with a formally configured textbook. The authors possibly have felt freer with a formally configured textbook. The authors possibly have felt freer and more like themselves in a conference text oand more like themselves in a conference text or journal article. Second, r journal article. Second, as it was mentioned by the speech of the rector Cemil Bilsel regarding as it was mentioned by the speech of the rector Cemil Bilsel regarding the publication of the journal, this journal the publication of the journal, this journal wawas appraised as s appraised as ““a signifi-a signifi-cant apparatus for introducing the scientific activities of the university cant apparatus for introducing the scientific activities of the university

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

to the coun

to the country and the world.try and the world.””57 Concentrating onConcentrating on the journal which ap-the journal which ap-pear as anpear as an instrument of selfinstrument of self--acquaintance of the university would then acquaintance of the university would then be an accurate choice for this dissertation which targets the attention of be an accurate choice for this dissertation which targets the attention of the global audience.the global audience.

This dissertation aims at analyzing the evolution of economics as it was carried out at the Faculty of Economics in Istanbul University and the Faculty of Political Sciences in Ankara University in between the 1930s and the 1960s. Moreover, it analyzes how and to what degree the disseminating economic theories were embarked on/reproduced in compliance with the peculiar conditions of the local. As such, the second chapter, namely the “Foundation of the Faculty of Economics in Istanbul University” begins with a brief overview on the conceptualizations of economics in the Ottoman Empire and elaborates on the transition pro-cess from Darülfünun to Istanbul University. Then, starting from the Institute for Economics and Sociology (İktisat ve İçtimaiyat Enstitüsü), the chapter focuses on the founding figures, the curricula and the rele-vant chairs of the faculty of economics. The foundation of the faculty is regarded as a vehicle of institutionalization of economics in Turkey by emancipating it from law. The reasons behind the emancipation of the discipline of economics from the law department and foundation of a separate faculty will be examined with a particular emphasis on the methodological differences. Then, the founding figures of the faculty, namely the German émigrés, and their historical backgrounds will be presented with a special emphasis on the formation of the discipline. The aims of the faculty will be presented based on the discourses of the academics. Next, the course list and chairs in the faculty will be investi-gated by focusing on the local peculiarities. The influence of the German academics in bringing about a new way of thinking in accordance with

57 Coşkun ÇakırCoşkun Çakır and Şevket Kamil Akar, and Şevket Kamil Akar, “İktisat Eğitiminin Beşiği İ.Ü. İktisat Fakültesinin “İktisat Eğitiminin Beşiği İ.Ü. İktisat Fakültesinin KuruluşuKuruluşu,,” ” İstanbul Üniversitesi İktisat Fakültesi Mecmuasıİstanbul Üniversitesi İktisat Fakültesi Mecmuası 49 (2011): 49 (2011): 306306.. The origiThe original nal speech is published in the first issue of the journal in 1939 in French.speech is published in the first issue of the journal in 1939 in French.

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the historical and political conditions of the country will constitute the main skeleton of this chapter.58

The

The thirthird chapter “The Definition, Scope and Method of Economics” d chapter “The Definition, Scope and Method of Economics” is one of the constituent parts of the dissertation. In this chapter, I ex-is one of the constituent parts of the dissertation. In this chapter, I ex-amine the general economics/introduction to economics textbooks and amine the general economics/introduction to economics textbooks and journal arjournal articles in relation with the conceptualizations of economic sci-ticles in relation with the conceptualizations of economic sci-ence. The textbook authors selected are Wilhelm Röpke, Fritz Neumark, ence. The textbook authors selected are Wilhelm Röpke, Fritz Neumark, Refii Şükrü Suvla and Şükrü Baban, who were the leading figures of the Refii Şükrü Suvla and Şükrü Baban, who were the leading figures of the faculty. The existence of a 5faculty. The existence of a 5--7 years gap in between 7 years gap in between each textbook is each textbook is consciously desired, to clarify the change and see the moving parts in consciously desired, to clarify the change and see the moving parts in content and conceptualizations by time. At the gravity center of this content and conceptualizations by time. At the gravity center of this chapter lie the microeconomic issues. First, the definition, subject mat-chapter lie the microeconomic issues. First, the definition, subject mat-ter and general principlester and general principles of economics in the eyes of the academics will of economics in the eyes of the academics will be examined. Next, the debates on methodology will take place based on be examined. Next, the debates on methodology will take place based on the interrogations on how important and meaningful is to discuss about the interrogations on how important and meaningful is to discuss about methodology at methodology at that that current era. The contemplations of the academicurrent era. The contemplations of the academics cs on which model reflects the realities of economic life better and which on which model reflects the realities of economic life better and which peculiarities shaped the preferred methodology peculiarities shaped the preferred methodology by them by them will be re-will be re-vealed. In the following section, the approaches of the authors vealed. In the following section, the approaches of the authors visvis--àà--visvis the value and price theories will be mentithe value and price theories will be mentioned. The concepts related oned. The concepts related with production and distribution and how they were evaluated by the with production and distribution and how they were evaluated by the academics will be presented afterwards. Next, the desired level of the academics will be presented afterwards. Next, the desired level of the relation between the science of economics and economic policies will be relation between the science of economics and economic policies will be mentioned focusingmentioned focusing on the mentioned limits of the role of an economist on the mentioned limits of the role of an economist in policy making processes. Finally, a general evaluation on the econom-in policy making processes. Finally, a general evaluation on the econom-ics textbooks with respect to the introduction to economics books in ics textbooks with respect to the introduction to economics books in Europe and America will take place. In each of these subheadingEurope and America will take place. In each of these subheadings, a s, a general theoretical background information about these concepts will general theoretical background information about these concepts will be presented first, and the approaches of the academics on each matter be presented first, and the approaches of the academics on each matter will be presented afterwards. will be presented afterwards.

58 Examination of Examination of the the chairs that mainly dealchairs that mainly dealtt with technical issues like statistics, with technical issues like statistics, economic geography, accounting, and some parts of business economics are therefore economic geography, accounting, and some parts of business economics are therefore beyond thbeyond the scope of this researche scope of this research..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

The

The fourthfourth chapter is on “Public Finance” which was a central field chapter is on “Public Finance” which was a central field of of the the curricurricula of the Faculty of Economics. Thcula of the Faculty of Economics. Thisis chapter begins with chapter begins with the presentation of the historical background of public finance, then the the presentation of the historical background of public finance, then the theoretical approaches since the emergence of the concept theoretical approaches since the emergence of the concept will bewill be por-por-trayed. Next, the fiscal policies in Turkey for the petrayed. Next, the fiscal policies in Turkey for the period reviewed in this riod reviewed in this dissertationdissertation will be examinedwill be examined whichwhich wwill ill construct the base for the fol-construct the base for the fol-lowing section that discusses the theoretical stance of the academics lowing section that discusses the theoretical stance of the academics about the fiscal issues. Examining the fiscal policies would also help to about the fiscal issues. Examining the fiscal policies would also help to see the disparitiessee the disparities between the policy makers and academicsbetween the policy makers and academics-- who at who at some pointsome pointss became policy making agentsbecame policy making agents--. . HHow the state wasow the state was theoreti-theoreti-callycally conceptualized and whether the classical orconceptualized and whether the classical or thethe modern theory on modern theory on public finance public finance wawas more appreciated by the academics will be reveales more appreciated by the academics will be revealed. d. The dimensions of the reception will be elaborated considering both the The dimensions of the reception will be elaborated considering both the dominant economic recipes around the world as well as the social, eco-dominant economic recipes around the world as well as the social, eco-nomic and cultural particularities of Turkey. The central figure in this nomic and cultural particularities of Turkey. The central figure in this chapter chapter occursoccurs as Fritz Neumark, who waas Fritz Neumark, who was the head of Public Finance s the head of Public Finance Theory and the Theory and the primary object of analysis would be his textbook primary object of analysis would be his textbook Mali-Mali-yeye Dair Tetkikleryeye Dair Tetkikler (Etudes on Finance)(Etudes on Finance), , together with the journal arti-together with the journal arti-cles in cles in Maliye Araştırma Merkezi KonferanslarıMaliye Araştırma Merkezi Konferansları ((Journal of Public Finance Journal of Public Finance StudiesStudies) ) and and SBFSBF (Journal of Faculty of Political Sciences).(Journal of Faculty of Political Sciences).

While the

While the fourthfourth chapter is mainly characterized by the relations be-chapter is mainly characterized by the relations be-tween state and economics, the ftween state and economics, the fiftifth chapter will deal with th chapter will deal with the human he human face of the economics namely theface of the economics namely the social economics (social economics (içtimai iktisatiçtimai iktisat) and) and social policy. Similar with the social policy. Similar with the fourthfourth chapter, the “Social Policy” chapter chapter, the “Social Policy” chapter is also a constitutive element of the curricula since the foundation of the is also a constitutive element of the curricula since the foundation of the faculty. This chapter ifaculty. This chapter is also significant in the sense that it implies to s also significant in the sense that it implies to what degree the “social” was embedded into the “economic”. First, the what degree the “social” was embedded into the “economic”. First, the birth of social policy in the world will be mentioned with an emphasis birth of social policy in the world will be mentioned with an emphasis on the procuring causes. The purpose of social policy, breaking on the procuring causes. The purpose of social policy, breaking points in points in the evolution process and differences in the social policy implementa-the evolution process and differences in the social policy implementa-tions among the developed and developing world will be revealed. tions among the developed and developing world will be revealed. Then, the theoretical approaches framing the nature and boundaries of Then, the theoretical approaches framing the nature and boundaries of social policy implementations will be examsocial policy implementations will be examined. Next, the social policy ined. Next, the social policy implementations in Turkey in various phases will be presented. How implementations in Turkey in various phases will be presented. How

Ş E B N E M G E L M E D İ

sociology and social policy were envisioned within the textbooks, jour-

sociology and social policy were envisioned within the textbooks, jour-nal articles and conference texts will be elaborated then. Here the key nal articles and conference texts will be elaborated then. Here the key figures figures appear asappear as Gerhard Kessler, Gerhard Kessler, for his contributions on thefor his contributions on the construc-construc-tion of a new theoretical structure in Istanbul University and Cahit Talas tion of a new theoretical structure in Istanbul University and Cahit Talas from Ankara University especially for his legacy in framing the determi-from Ankara University especially for his legacy in framing the determi-nants of social policy after the Wnants of social policy after the World orld WWar ar II. This chaII. This chapter is comprised pter is comprised of the occasions behind the perceived need for social policyof the occasions behind the perceived need for social policy with an em-with an em-phasis on its phasis on its contentcontent andand boundaries boundaries together with thetogether with the key conceptkey conceptss regarding social policy,regarding social policy, as they appear in the as they appear in the manifestations ofmanifestations of the aca-the aca-demics. demics.

The

The sixthsixth chapter chapter is on “Development Economics”. is on “Development Economics”. Indeed, tIndeed, the he fourthfourth, f, fiftifth and the h and the sixth sixth chapters can be considered as integral parts of chapters can be considered as integral parts of a whole when we think of the interrelata whole when we think of the interrelatednessedness of the themes, tools uti-of the themes, tools uti-lized for each and the lized for each and the relative relative weight of theweight of these conceptsse concepts in the agein the agenda. nda. Yet, for this chapter, the period after the WYet, for this chapter, the period after the World orld WWar ar II is much more II is much more highlighted highlighted with respect to other chapters, with respect to other chapters, as the decolonization pro-as the decolonization pro-cess was in striking distance and the differences between the devel-cess was in striking distance and the differences between the devel-oped/developing/lessoped/developing/less--developed countries appedeveloped countries appeared as a problem in ared as a problem in procuring the new economic order shaped by the Cold War dynamics. procuring the new economic order shaped by the Cold War dynamics. Taking account of this, the main point of this chapter would be the anal-Taking account of this, the main point of this chapter would be the anal-ysis on to what degree the emergent theories on development were em-ysis on to what degree the emergent theories on development were em-barked on by the academics herbarked on by the academics here. Portraying a brief historical back-e. Portraying a brief historical back-ground of development economics and the theories on development, ground of development economics and the theories on development, the development experience of Turkey will be elaborated with particu-the development experience of Turkey will be elaborated with particu-lar emphasis on the breaking points and prominent developmental lar emphasis on the breaking points and prominent developmental steps. Next, the focussteps. Next, the focus will be oriented to the archive material in search will be oriented to the archive material in search forfor a suitable theory recommended by the academics in specifying a a suitable theory recommended by the academics in specifying a roadmap for economic dıevelopment goalroadmap for economic dıevelopment goal regardingregarding the peculiar condi-the peculiar condi-tions of Turkeytions of Turkey. At this point Sabri Ülgener’s analysis on the reasons. At this point Sabri Ülgener’s analysis on the reasons of of underdevelopment and mentality barriers for development are im-underdevelopment and mentality barriers for development are im-portant to mention, yet the material richness of the portant to mention, yet the material richness of the JJournal of ournal of Ankara Ankara UniversityUniversity Faculty of Political SciencesFaculty of Political Sciences ((SBF) SBF) and the abundance of the and the abundance of the articles related with development contributes aarticles related with development contributes a lot more in clarifying lot more in clarifying the theoretical positions the current academics leaned towards.the theoretical positions the current academics leaned towards.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

The

The seventhseventh chapter is on “The Keynesian Impact”. This chapter chapter is on “The Keynesian Impact”. This chapter functions as a backbone of this dissertation as the transition from mi-functions as a backbone of this dissertation as the transition from mi-croeconomics to macroeconomics signcroeconomics to macroeconomics signifies an important breaking point ifies an important breaking point in economics education. This shift made itself most evident by the in-in economics education. This shift made itself most evident by the in-creasing impact of Keynesian precepts in the teaching of economics. creasing impact of Keynesian precepts in the teaching of economics. Before elaborating on the Keynesian impact in local academia, the con-Before elaborating on the Keynesian impact in local academia, the con-ditions that gavditions that gave rise to Keynesian revolution and how Keynesian ideas e rise to Keynesian revolution and how Keynesian ideas were perceived in various countries will be presented. Then, the con-were perceived in various countries will be presented. Then, the con-venience of the economic policies in Turkey for the given period to the venience of the economic policies in Turkey for the given period to the Keynesian precepts will be tested. And finally, how KeynesianKeynesian precepts will be tested. And finally, how Keynesian theory theory was received by the academics will be mentioned. Introducing a variety was received by the academics will be mentioned. Introducing a variety of arguments on the applicability and nonapplicability of the Keynesian of arguments on the applicability and nonapplicability of the Keynesian tenets, the crucial roles of the two ideologically different figures that are tenets, the crucial roles of the two ideologically different figures that are Sabri Ülgener from IstanbulSabri Ülgener from Istanbul University and Sadun Aren from University and Sadun Aren from Ankara Ankara UniversityUniversity in spreading and maintaining the Keynesian approach will be in spreading and maintaining the Keynesian approach will be emphasized. Each academic’s textbooks inspired by the Keynesian ideas emphasized. Each academic’s textbooks inspired by the Keynesian ideas will be elaborated respectively to find out the commonalities and diver-will be elaborated respectively to find out the commonalities and diver-gencegencess, , both with the Keynesian theory and each other.both with the Keynesian theory and each other.

Before concluding the dissertation,

Before concluding the dissertation, I would like to presentI would like to present a reflec-a reflec-tion chapter in which I intended to go in a different direction from the tion chapter in which I intended to go in a different direction from the other chapters and elaborate on what was lacking instead of what other chapters and elaborate on what was lacking instead of what was was present present atat the agenda of the local academia. Apart from concentrating the agenda of the local academia. Apart from concentrating on the theories that were received and adapted in accordance with the on the theories that were received and adapted in accordance with the national national peculiaritiespeculiarities, the question of wh, the question of whichich theories or debates theories or debates that that occupied the agenda of the Western countroccupied the agenda of the Western countries ies remained outside theremained outside the se-se-lected repertoire of theories come more to the forefront in this chapter. I lected repertoire of theories come more to the forefront in this chapter. I particularly elaborated on why the vigorous debates on socialism had particularly elaborated on why the vigorous debates on socialism had such little repercussions at the local academia and what might be some such little repercussions at the local academia and what might be some possible reaspossible reasons for such a strong adherence to capitalism, although it ons for such a strong adherence to capitalism, although it was was envisioned as aenvisioned as a revised and ameliorated version of capitalism. In revised and ameliorated version of capitalism. In doing this, I intended to associate the ideological discourses of the aca-doing this, I intended to associate the ideological discourses of the aca-demic economistsdemic economists regarding the economic systemsregarding the economic systems with twith the political he political and economic atmosphereand economic atmosphere of the country,of the country, which were partly determined which were partly determined by the governing elitesby the governing elites, the social structure, the social structure and the external conditions.and the external conditions.

Ş E B N E M G E L M E D İ

All through the period addressed in this dissertation, the W

All through the period addressed in this dissertation, the World orld WWar ar II occurs as a breaking point II occurs as a breaking point in many respects, one of which is related in many respects, one of which is related with the shift in the gravity center of economics. In this sense, the sec-with the shift in the gravity center of economics. In this sense, the sec-ond and the sixth chapter appear as the two crucial parts of this disser-ond and the sixth chapter appear as the two crucial parts of this disser-tation. The intermediate chapters on public finance, social policy antation. The intermediate chapters on public finance, social policy and d development economics embody the inner dynamics of how “econom-development economics embody the inner dynamics of how “econom-ics” was perceived and signify the increasing tendency to look at the ics” was perceived and signify the increasing tendency to look at the economic phenomena within a macro perspective in due course. Each economic phenomena within a macro perspective in due course. Each chapter would hopefully provide chapter would hopefully provide a a necessary axis for enlnecessary axis for enlightening the ightening the blurred period between the foundation of the Faculty of Economics and blurred period between the foundation of the Faculty of Economics and the establishment of a new mainstream by the translation of Paul Sam-the establishment of a new mainstream by the translation of Paul Sam-uelson’s uelson’s EconomicsEconomics representing the “neoclassical synthesis”. Some of representing the “neoclassical synthesis”. Some of the material referred might be a fthe material referred might be a few years earlier or later from the men-ew years earlier or later from the men-tioned time interval; tioned time interval; neverthelessnevertheless, I preferred to utilize them in case , I preferred to utilize them in case they are so critical in understanding the dynamics of the evolution of they are so critical in understanding the dynamics of the evolution of economics discipline. economics discipline.

A detailed examination on how, when, why and to what

A detailed examination on how, when, why and to what degree some degree some theories related with the basic constituents of economics were internal-theories related with the basic constituents of economics were internal-ized by the academic figures in construction of the scientific knowledge ized by the academic figures in construction of the scientific knowledge is important in the sense that it would both signify the particularities of is important in the sense that it would both signify the particularities of the country and thethe country and the relrelativeative weight of social, political, cultural and psy-weight of social, political, cultural and psy-chological influences in determining the boundaries of the science of chological influences in determining the boundaries of the science of economics. Elaborating on the decisive factors behind the adoption of economics. Elaborating on the decisive factors behind the adoption of some economic theories while filtering out others requires a zoomsome economic theories while filtering out others requires a zoom into into the country specific dimensions, yet each experience has a lot to say for the country specific dimensions, yet each experience has a lot to say for the whole literature on national histories of economic thought and soci-the whole literature on national histories of economic thought and soci-ology of economics.ology of economics.

2 FoundationFoundation of the Faculty of Economics in Istanbul of the Faculty of Economics in Istanbul UniversityUniversity

he new capit

he new capital of the country was identified as Ankara even before al of the country was identified as Ankara even before the foundation of the the foundation of the RRepublic, epublic, thethe city at the city at the heartheart of Anatolia of Anatolia wherein the Turkish wherein the Turkish WWar of ar of IIndependence was governed. Most of the ndependence was governed. Most of the social and capital investment were primarily made in there in the earsocial and capital investment were primarily made in there in the earli-li-er years of the er years of the RRepublicepublic asas Ankara was designated as a representative Ankara was designated as a representative city for the changing city for the changing appearanceappearance of the countryof the country.. TheThe change change was not was not ononlly apparent y apparent in the political and cultural domainsin the political and cultural domains,, but also in but also in the the eco-eco-nomic nomic fieldfield with a resolvedly emphasizedwith a resolvedly emphasized goagoal of rapidl of rapid national eco-national eco-nomic developmentnomic development. . This goal had repercussions bothThis goal had repercussions both on theon the policy lev-policy lev-el and el and the the reforms in the institutional framework. reforms in the institutional framework. IIn con contrast with the ntrast with the central importance of Ankara as central importance of Ankara as the the representative cityrepresentative city within many within many respectsrespects, a question rel, a question related to this dissertation might occur:ated to this dissertation might occur: why the why the new faculty of economics, which was expected to play a key role in the new faculty of economics, which was expected to play a key role in the development of economic science in Turkey, was established in Istanbul development of economic science in Turkey, was established in Istanbul instead of Ankara? instead of Ankara? AndAnd eveneven beyondbeyond the choice of locationthe choice of location, , why a why a fafacul-cul-ty of economics ty of economics was founded was founded at the midst of the 1930s? What were the at the midst of the 1930s? What were the inner dynamics that entailed such a settlement, what was expected from inner dynamics that entailed such a settlement, what was expected from aa new faculty of economics, what new faculty of economics, what kind of a kind of a changechange was itwas it expected to expected to bring about bring about forfor the conceptualization of ecothe conceptualization of economic science or material nomic science or material economic requirements of the country? Who were the founding figures economic requirements of the country? Who were the founding figures

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and how the framework for educational domain in economic science

and how the framework for educational domain in economic science was identified? was identified? In brief, wIn brief, what was understood from economics? hat was understood from economics? All All tthese questions constitute the hese questions constitute the core inquiries of this chapter and starting core inquiries of this chapter and starting points for the following chapters.points for the following chapters.

The evolution of an autonomous faculty of economics

The evolution of an autonomous faculty of economics –– first as an first as an institute together with sociology in the 1930sinstitute together with sociology in the 1930s –– began in Istanbul Uni-began in Istanbul Uni-versity. The ongoing French influence in versity. The ongoing French influence in the cultural sphere began to be the cultural sphere began to be gradually displaced by the arrival of German émigré economists, who gradually displaced by the arrival of German émigré economists, who were among the founding figures of this new faculty structure. By the were among the founding figures of this new faculty structure. By the emancipation of the economics discipline from the faculty of law, a new emancipation of the economics discipline from the faculty of law, a new structure was structure was established for economics within its own methodology established for economics within its own methodology and prior concerns of the science. Yet, the scope and content of econom-and prior concerns of the science. Yet, the scope and content of econom-ics wics wereere not conceptualized in those days as not conceptualized in those days as they arethey are today.today. There were There were less abstractions or universally accepted “neutral” principlless abstractions or universally accepted “neutral” principles, but a es, but a more concrete and fluid agenda oriented to make a difference in provid-more concrete and fluid agenda oriented to make a difference in provid-ing national economic development. Therefore, a coherency between ing national economic development. Therefore, a coherency between the particular economic realities of the country and the content of the the particular economic realities of the country and the content of the discipline discipline becamebecame visible as the priorvisible as the prior concern was to diagnose the concern was to diagnose the needs and problems of the country before generating solution offers. needs and problems of the country before generating solution offers. However, it should be emphasized that this sensitivity went hand in However, it should be emphasized that this sensitivity went hand in hand with a faith in establishing a rational and scientific framework, hand with a faith in establishing a rational and scientific framework, shaped within the ashaped within the added value provided by the academics in transla-dded value provided by the academics in transla-tiontion/localization/reception/localization/reception of the most appropriate theories around. of the most appropriate theories around.

In exploring the evolution and institutionalization of the discipline

In exploring the evolution and institutionalization of the discipline at the local level, at the local level, firstfirst the historical background of economics educthe historical background of economics education ation in the Ottoman Empirein the Ottoman Empire will be examinedwill be examined. Then, the reasons behind the . Then, the reasons behind the university reform and foundation of a new faculty will be investigated. university reform and foundation of a new faculty will be investigated. Afterwards, the core academic figures, Afterwards, the core academic figures, the the core aspects that were paired core aspects that were paired with economics and the curriculum wiwith economics and the curriculum will be identified. Consequently, the ll be identified. Consequently, the impacts of the conjunctural needs of the era, revolutionary reforms and impacts of the conjunctural needs of the era, revolutionary reforms and national economic priorities of the country in generating the atmos-national economic priorities of the country in generating the atmos-phere in which the economics discipline was evolved will be revealed.phere in which the economics discipline was evolved will be revealed.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

§ 2.1 HistoricHistorical Backgroundal Background

Although the humankind haAlthough the humankind hadd dealt with economic problems much ear-dealt with economic problems much ear-lier than the pharaoh age, lier than the pharaoh age, economist and thinker economist and thinker Robert Heilbroner Robert Heilbroner propounds that there was no economist among dozens of philosophers, propounds that there was no economist among dozens of philosophers, positive scientists, political thinkers, apositive scientists, political thinkers, artists, historians and bureaucrats rtists, historians and bureaucrats in the meantime. He asks why and tries to elaborate on the reasons why in the meantime. He asks why and tries to elaborate on the reasons why the existence of an economist was not only useless but also impossible the existence of an economist was not only useless but also impossible in the old world before the modern age.in the old world before the modern age.1 Through his intellectual jour-Through his intellectual jour-ney on vaney on various cases among different countriesrious cases among different countries2, he discovers that the , he discovers that the idea of a system based on personal gain was not considered that suita-idea of a system based on personal gain was not considered that suita-bleble thenthen. To put it in another way, the world of an autonomous econom-. To put it in another way, the world of an autonomous econom-ics detached from the social context did not appear yet.ics detached from the social context did not appear yet.3 Working was Working was not considered as a mean to attain money. Economic and social life was not considered as a mean to attain money. Economic and social life was one and the same thing.one and the same thing.4 The political, social and theologicalThe political, social and theological aspectsaspects were strongly embedded to the world of practical things. were strongly embedded to the world of practical things. Therefore, it Therefore, it can be said that can be said that tthe profit mhe profit motive is not as old as the humankind, but the otive is not as old as the humankind, but the “modern man”.“modern man”.5

1 Robert L. Robert L. Heilbroner, Heilbroner, İktisat İktisat DüşünürleriDüşünürleri: Büyük İktisat Düşünürlerinin Yaşamları ve : Büyük İktisat Düşünürlerinin Yaşamları ve Fikirleri,Fikirleri, translated by Ali Tartanoğlu (translated by Ali Tartanoğlu (Ankara: Ankara: Dost Dost KitabKitabevi,evi, 2003), 2003), 1717. .

2 Through the inquiry, he goes back to a fair in France in 1305, during when new Through the inquiry, he goes back to a fair in France in 1305, during when new vocabulary of the distant lands wavocabulary of the distant lands was learnt, the usage of “0” was not wells learnt, the usage of “0” was not well--known, the known, the calculations were made by Roman numerals, the total amount of the goods in a year calculations were made by Roman numerals, the total amount of the goods in a year was less than the capacity of a merchandisewas less than the capacity of a merchandise train. The second pause he mentioned was train. The second pause he mentioned was Germany in 1550, where a merchant compGermany in 1550, where a merchant complains about the city tolls of thirty market lains about the city tolls of thirty market places with different units of measurements due to different rules and order. He con-places with different units of measurements due to different rules and order. He con-tinues with Boston in 1639, and refers to a theology professor who was accused of tinues with Boston in 1639, and refers to a theology professor who was accused of making 6 pens profit of 1 shilling and judged making 6 pens profit of 1 shilling and judged as a sinner, and as a sinner, and with with France France in 1666in 1666 where Colbert published a decree about the maximum amount of yarn in the textile where Colbert published a decree about the maximum amount of yarn in the textile industry. Unless a merchant disobeys this rule, there is this risk of being unrolled. industry. Unless a merchant disobeys this rule, there is this risk of being unrolled. Ibid., 21Ibid., 21--23.23.

3 IbidIbid.., 23, 23..

4 IbidIbid.., 25, 25..

5 IbidIbid.., 23, 23..

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The change was a versatile process,The change was a versatile process, withwith the emergence of national the emergence of national political unities in Europe, the disintegration of religious spirituality by political unities in Europe, the disintegration of religious spirituality by the renaissance, the monetization process as the mothe renaissance, the monetization process as the money is accumulated ney is accumulated in the hands of merchants instead of the feudal lords despising money in the hands of merchants instead of the feudal lords despising money and the technological progress with scientific curiosity.and the technological progress with scientific curiosity.6 As Heilbroner As Heilbroner suggests, this was not a hairpin turnsuggests, this was not a hairpin turn indeedindeed, the emergence of a market , the emergence of a market society went alongsidesociety went alongside the traditional lifestyle.the traditional lifestyle.7 At the end, the labor At the end, the labor pains of the change came to an end, and selfpains of the change came to an end, and self--regulating market system regulating market system was born with a new modern viewpoint based on canonizing the urge of was born with a new modern viewpoint based on canonizing the urge of personal gain.personal gain. At the heart of the modern economics, there At the heart of the modern economics, there wawas thes the belief that a belief that a universal economic theory based on a simple causality principle can be universal economic theory based on a simple causality principle can be achieved, disregarding how people constituted the society, for what achieved, disregarding how people constituted the society, for what purpose and within which values. Hence, the formalist description of purpose and within which values. Hence, the formalist description of economics, removeeconomics, removedd the institutiothe institutional structure between the human be-nal structure between the human be-havior and its economic consequences, attributing spontaneity to eco-havior and its economic consequences, attributing spontaneity to eco-nomic activity as if it is directly caused by the individual behaviornomic activity as if it is directly caused by the individual behavior8, the , the behavior of the economic man. behavior of the economic man. ThThisis journey of economic thinking is important journey of economic thinking is important in the sense that it in the sense that it reminds us the system we live in today was not from all eternity and the reminds us the system we live in today was not from all eternity and the characteristics of human nature were not always the same. Hence, the characteristics of human nature were not always the same. Hence, the social history of ideas and examination of their contextual determinants social history of ideas and examination of their contextual determinants have critical importhave critical importance in understanding what we are today. Econom-ance in understanding what we are today. Econom-ics today also has experienced many epistemological shifts via the ics today also has experienced many epistemological shifts via the spread of ideas depending on the needs of the time. “The ordinary busi-spread of ideas depending on the needs of the time. “The ordinary busi-ness of life”, in Roger Backhouse’s words, could not anymore be con-ness of life”, in Roger Backhouse’s words, could not anymore be con-tendetended with practical calculations. Especially in the eighteenth and d with practical calculations. Especially in the eighteenth and nineteenth century nineteenth century during whenduring when the economic thinking the economic thinking tooktook primacy, primacy, the need for a philosophthe need for a philosophical ground ical ground became more apparent. Number of became more apparent. Number of the books aspiring to portray the modern society within athe books aspiring to portray the modern society within a framework of framework of

6 IbidIbid.., 32, 32--3333..

7 IbidIbid.., 34, 34..

8 Ayşe Ayşe Buğra, Buğra, İktisatçılar ve İnsanlarİktisatçılar ve İnsanlar (İstanbul: İletişim Yayınları, 2013),(İstanbul: İletişim Yayınları, 2013), 5858..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

an intellectual system multiplied. Traites, manuals, articles related to an intellectual system multiplied. Traites, manuals, articles related to economic phenomena in newspapers and journalseconomic phenomena in newspapers and journals as well as theas well as the text-text-books were swept. Reflecting the books were swept. Reflecting the transformintransforming concerns about econom-g concerns about econom-ic thinking, economics, as a discipliic thinking, economics, as a discipline, has become institutionalized in ne, has become institutionalized in universities universities –– although under the departments of law or philosophyalthough under the departments of law or philosophy –– and each country experienced this institutionalization process depend-and each country experienced this institutionalization process depend-ing on its spatial and cultural peculiarities. ing on its spatial and cultural peculiarities.

The discipline of economics was in

The discipline of economics was institutionalized rather late not on-stitutionalized rather late not on-ly in Turkey but also in Europe. Although we can see examples about ly in Turkey but also in Europe. Although we can see examples about education related to trade issueseducation related to trade issues, , which forms the basis for economics which forms the basis for economics educationeducation,, even as early as the even as early as the fifteenthfifteenth century, this century, this wawas more like a s more like a practical epractical education. However, we must wait till the ducation. However, we must wait till the eighteeneighteenth century th century to see the foundation of business schools. The French founded Hautes to see the foundation of business schools. The French founded Hautes Etudes CommercialeEtudes Commerciale (HEC)(HEC) in the second half of the in the second half of the nineteennineteenth century. th century. HECs continued to be founded in Belgium, Anvers in 1852 HECs continued to be founded in Belgium, Anvers in 1852 and Italy, Bari and Italy, Bari in 1872. The School of Commerce was founded in America Philadelphia in 1872. The School of Commerce was founded in America Philadelphia in 1881. Just after only one year, based on the American example, the in 1881. Just after only one year, based on the American example, the FrenFrencch h founded the famous Ecole des Hautes Etudes Commerciale. In founded the famous Ecole des Hautes Etudes Commerciale. In 1900, the Faculty of Commerce was la1900, the Faculty of Commerce was launched in Birmingham University, unched in Birmingham University, England. In the England. In the twentietwentieth century, many faculties were founded in th century, many faculties were founded in America.America.9 And what about the situation in Turkey?And what about the situation in Turkey? Now, Now, II will concen-will concen-trate on the institutionalization of economics in the trate on the institutionalization of economics in the RRepublican Turkey epublican Turkey based on the formbased on the formation of the faculty of economics which was consid-ation of the faculty of economics which was consid-ered as the cradle of the education of the economics discipline in Tur-ered as the cradle of the education of the economics discipline in Tur-key.key.

9 Coşkun Coşkun ÇakırÇakır and Şevket Kamil Akar, and Şevket Kamil Akar, “İktisat Eğitiminin “İktisat Eğitiminin BeşiğiBeşiği,,” 1” 1,, citedcited in Nihad Sayar, in Nihad Sayar, “Batıda ve Doğuda İktisat Öğretiminin Tarihsel Gelişimi”, Türkiye’de İktisat “Batıda ve Doğuda İktisat Öğretiminin Tarihsel Gelişimi”, Türkiye’de İktisat ÖğrÖğretiminin Sorunları Semineri, Tüm İktisadi Ticari İlimler Akademileri ve Bağlı etiminin Sorunları Semineri, Tüm İktisadi Ticari İlimler Akademileri ve Bağlı Yüksek Okullar Mezunlar Derneği, TİTAX (16Yüksek Okullar Mezunlar Derneği, TİTAX (16--17 Şubat 1978, Bildiriler), (İstanbul: 17 Şubat 1978, Bildiriler), (İstanbul: 1979):1979): 1818--20.20.

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§ 2.2 Institutionalization of Institutionalization of the Discipline of Economics in the Discipline of Economics in TurkeyTurkey

2.2.1 Historical Background: Economics in the Ottoman Empire Historical Background: Economics in the Ottoman Empire and Early and Early Years of the RepublicYears of the Republic

The history of Turkish economic thought traces back before the founda-

The history of Turkish economic thought traces back before the founda-tion of an autonomous faculty of economics in the tion of an autonomous faculty of economics in the RRepublican era. epublican era. OneOne can see the imprints ofcan see the imprints of thethe classical school through the teaching of eco-classical school through the teaching of eco-nomics after the Tanznomics after the Tanzimat imat reform reform era. This was not an incidental cir-era. This was not an incidental cir-cumstance; actually, there were historical reasons behind the centrality cumstance; actually, there were historical reasons behind the centrality of of the the classical approach. The strong winds of economic liberalism of classical approach. The strong winds of economic liberalism of the nineteenth century was forcing the doors of the empire and dirthe nineteenth century was forcing the doors of the empire and direct-ect-ing it to open its borders for much more trade. ing it to open its borders for much more trade. By means ofBy means of a fa free trade ree trade treaty treaty with Briatain with Briatain in 1838in 1838, the, the Ottoman Empire Ottoman Empire began to bebegan to be articulat-articulat-ed to capitalismed to capitalism and the economic mindset and the economic mindset –– which was mostly based which was mostly based on subsistence productionon subsistence production–– began to change began to change form from then on. Profit form from then on. Profit making was not a main constituent of economic thinking before; how-making was not a main constituent of economic thinking before; how-ever, the current conditions forced the existing mindset to reshape itself ever, the current conditions forced the existing mindset to reshape itself in accordance with the dynamics of world capitalism. Both exposures in accordance with the dynamics of world capitalism. Both exposures and reactions came inand reactions came into the picture. The repercussions of the current to the picture. The repercussions of the current incidents had also manifested themselves via one of the most significant incidents had also manifested themselves via one of the most significant instruments of social change: the education. Hence, instruments of social change: the education. Hence, to gain to gain insights insights about about how how this socioeconomic change was conceivedthis socioeconomic change was conceived both in theoretboth in theoretical ical and practical senseand practical sense,, it would be meaningful to it would be meaningful to examinexaminee the prevalent the prevalent veins in economics education veins in economics education in the empire.in the empire.

Ahmet Güner Sayar, who studied on the modernization of Ottoman

Ahmet Güner Sayar, who studied on the modernization of Ottoman economic thought claims that economics was first taught by Serandi economic thought claims that economics was first taught by Serandi Arşizen Arşizen in Mektebin Mekteb--i Tıbbiyei Tıbbiye--i Şahanei Şahane (Ottoman Medical School)(Ottoman Medical School) in in French. Yet, he argues that, there was no systematic teaching program French. Yet, he argues that, there was no systematic teaching program till the foundation of Mektebtill the foundation of Mekteb--i Mülkiye in 1859, except some private i Mülkiye in 1859, except some private lessons. (Senior has taught economics to Ahmet Vefik Palessons. (Senior has taught economics to Ahmet Vefik Pashsha, a, for exam-for exam-ple.) Similar with many other European countries, the classical liberal ple.) Similar with many other European countries, the classical liberal

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

doctrine was dominant

doctrine was dominant,, as the nineteenth century was the era the as the nineteenth century was the era the idealideal of “liberalism” was applauded both in political and economic senses. of “liberalism” was applauded both in political and economic senses. However, Sayar claims that the classHowever, Sayar claims that the classical ideology in line ical ideology in line withwith J. B. Say J. B. Say and Luigi Rossi was not capable of constituting a strong base. It was for and Luigi Rossi was not capable of constituting a strong base. It was for the appeal for some concerned people of that generation and remained the appeal for some concerned people of that generation and remained limited in influence.limited in influence.10

On the other hand, Sayar mentions that the education

On the other hand, Sayar mentions that the education in Mülkiye in Mülkiye was a threshold for a longwas a threshold for a long--termed economics education. For instance, termed economics education. For instance, Sakızlı Ohannes PaSakızlı Ohannes Pashsha’s a’s MebadiMebadi--i İlmi İlm--i Serveti Servet advocating for the classical advocating for the classical liberalism was also utilized by his successor Mehmet Cavid Bey liberalism was also utilized by his successor Mehmet Cavid Bey --finance finance minister of Union and Progresminister of Union and Progresss-- in his İlmin his İlm--i İktisati İktisat (economic science)(economic science) courses for Mülkiye students. However, the dominance of courses for Mülkiye students. However, the dominance of the the classical classical doctrine doesn’t mean that it doctrine doesn’t mean that it hahadd nevernever beenbeen challenged. challenged. Indeed, tIndeed, the he current economic problems of the empire were giving rise to new dis-current economic problems of the empire were giving rise to new dis-putes sputes seeking for different solutions, as it eeking for different solutions, as it can be seencan be seen in the case of the in the case of the industryindustry--agriculture debate in Mülkiye which gave birth to agriculture debate in Mülkiye which gave birth to the the ideas on ideas on protectionism.protectionism.11 These two reverse ideologiesThese two reverse ideologies, liberalism and protec-, liberalism and protec-tionism, tionism, colluded with each other and the impactcolluded with each other and the impact of the classical liberal-of the classical liberal-ism weakened due to the conjunctural conditions of the warfare, ism weakened due to the conjunctural conditions of the warfare, as it as it appearedappeared in the journals, newspapers and policy decisions.in the journals, newspapers and policy decisions.12 ThThisis change became observable by the period after the Second Constitution-change became observable by the period after the Second Constitution-al Monarchy, particularly dual Monarchy, particularly during the warfare. Ziyaüddin Fahri Fındıkoğlu ring the warfare. Ziyaüddin Fahri Fındıkoğlu asserts that the Turkish economists started to become concerned about asserts that the Turkish economists started to become concerned about a new branch that is a new branch that is called called basireti içtimaiyebasireti içtimaiye ““ssprévoyance sociale” in prévoyance sociale” in French terms and French terms and içtimai siyasetiçtimai siyaset “sozialpolitik” in German from then “sozialpolitik” in German from then on. on. In addition, the highly increased profiteering towards the end of the war In addition, the highly increased profiteering towards the end of the war

10 Ahmed GünerAhmed Güner Sayar, “TarihçemizSayar, “Tarihçemiz,,” http://iktisat.istanbul.edu.tr/?page_id=6926” http://iktisat.istanbul.edu.tr/?page_id=6926

11 Ibid.,Ibid., http://iktisat.istanbul.edu.tr/?page_id=6926http://iktisat.istanbul.edu.tr/?page_id=6926

12 For detailed analysis of the period,For detailed analysis of the period, seesee Zafer Toprak, Zafer Toprak, Türkiye’de Ekonomi ve Toplum Türkiye’de Ekonomi ve Toplum (1908(1908--1950): Milli İktisat, Milli Burjuvazi 1950): Milli İktisat, Milli Burjuvazi (Beşiktaş, İstanbul: Tarih Vakfı Yurt Yayınları, (Beşiktaş, İstanbul: Tarih Vakfı Yurt Yayınları, 1995)1995)

Ş E B N E M G E L M E D İ

paved the way for interventionism both in theoretical and practical

paved the way for interventionism both in theoretical and practical sensesensess..13 The ethical norms were brought to agenda. The ethical norms were brought to agenda.

One might see the presence of a

One might see the presence of a contcontinuity on this aspect inuity on this aspect in the early in the early years of the years of the RRepublicepublic as wellas well. Fındıkoğlu. Fındıkoğlu in his book on teaching and in his book on teaching and faculty of economics in the faculty of economics in the RRepublican era,epublican era, manifests the distance of manifests the distance of economics education from liberal ideas and changing conceptualiza-economics education from liberal ideas and changing conceptualiza-tions on state by saying:tions on state by saying:

We are now not only far away from the poorspirited lib

We are now not only far away from the poorspirited liberalism of eralism of the Tanzimat Era… the Tanzimat Era… BBut also from the liberal economic considera-ut also from the liberal economic considera-tions of the thinkers that published tions of the thinkers that published UlûmUlûm--ıı İktisadiye ve İçtimaiye İktisadiye ve İçtimaiye MecmuasıMecmuası in the very first years of the constitutional monarchy. in the very first years of the constitutional monarchy. The transition from the “warden state” to “paternaThe transition from the “warden state” to “paternal state” l state” changed the form of economics education. An examination of the changed the form of economics education. An examination of the 19081908--1923 period will give clues about how the idea of “national 1923 period will give clues about how the idea of “national economics” was developed.economics” was developed.14

In the first ten years of the

In the first ten years of the RRepublicepublic,, the economics courses were in-the economics courses were in-structed in structed in IIstanbul Dastanbul Darülfünunu Faculty of Law and Mektebrülfünunu Faculty of Law and Mekteb--i Mülkiye, i Mülkiye, based on the Ottoman legacy.based on the Ottoman legacy.15 Although the education of economics Although the education of economics was already given in some institutions like business schools and despite was already given in some institutions like business schools and despite the appearance of new approaches, there was a lack of systematic theo-the appearance of new approaches, there was a lack of systematic theo-rretical understanding etical understanding whichwhich became much more obvious during the became much more obvious during the early years of the early years of the RRepublic. However, this matter was not really at the epublic. However, this matter was not really at the center of attention for a while as center of attention for a while as aa new regime was established and new regime was established and there were numerous radical reformsthere were numerous radical reforms on the agendaon the agenda to to be urgently im-be urgently im-plementedplemented. . Among the very first objectives, there was a rapid postwar Among the very first objectives, there was a rapid postwar reconstruction of the economy; so, the government concentrated more reconstruction of the economy; so, the government concentrated more

13 ZiyaüddinZiyaüddin Fahri Fahri Fındıkoğlu, Fındıkoğlu, Türkiye’de İktisat TedrisatıTürkiye’de İktisat Tedrisatı Tarihçesi ve İktisat Fakültesi Tarihçesi ve İktisat Fakültesi TeşkilatıTeşkilatı (İstanbul: İ. Akgün Matbaası, 1946), (İstanbul: İ. Akgün Matbaası, 1946), 5757. . Fındıkoğlu Fındıkoğlu refers the etude “Hukuk ve refers the etude “Hukuk ve İktisat Bakımından İhtikar” in İktisat Bakımından İhtikar” in Üniversite KonferanslarıÜniversite Konferansları 1942 for an enriched analysis 1942 for an enriched analysis onon profiteering.profiteering.

14 Fındıkoğlu, Fındıkoğlu, Türkiye’de İktisatTürkiye’de İktisat,” ,” 5757--5858..

15 http://iktisat.istanbul.edu.tr/?page_id=6926http://iktisat.istanbul.edu.tr/?page_id=6926

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

on economic policy making rather than economic thought, especially

on economic policy making rather than economic thought, especially until the Great Depression in 1929.until the Great Depression in 1929.16 ThereforeTherefore,, in line with Özveren,in line with Özveren, it it wouldn’t be wrong to argue that the 1920s represent an obscure decade wouldn’t be wrong to argue that the 1920s represent an obscure decade concerning the Turkish economic thought.concerning the Turkish economic thought.17

In fact, even the greatest economies of the world were shrinking in

In fact, even the greatest economies of the world were shrinking in the corresponding decade. The nineteenththe corresponding decade. The nineteenth century liberalism was hard century liberalism was hard to be sustained due to the huge losses of the Great War, but during the to be sustained due to the huge losses of the Great War, but during the 1920s, the “1920s, the “cconservative onservative ttwenties” in Polanyi’s wordswenties” in Polanyi’s words,,18 there was a there was a search for a restoration of the liberal order. As for Turkey, we see a search for a restoration of the liberal order. As for Turkey, we see a peaceful articulpeaceful articulation with the world order by combining ation with the world order by combining partly partly liberal liberal economic policies and reconstruction process which was primarily im-economic policies and reconstruction process which was primarily im-portant for the government. The portant for the government. The RRepublic was young and the prior in-epublic was young and the prior in-tention was to secure the maintenance of the acquisitions which leftention was to secure the maintenance of the acquisitions which left t little room for concentrating for the establishment of new theories. little room for concentrating for the establishment of new theories.

However, the year 1929 refers to a breaking point. It was the year

However, the year 1929 refers to a breaking point. It was the year that Turkey eventually became entitled to determine its own tariff rates. that Turkey eventually became entitled to determine its own tariff rates. In the aftermath of the expiration of the rIn the aftermath of the expiration of the related article inelated article in thethe Lausanne Lausanne TreatyTreaty –– which had provisionswhich had provisions onon limiting the tariff rateslimiting the tariff rates –– and as the and as the Great Depression hit the economies, a more peculiar policy improvisa-Great Depression hit the economies, a more peculiar policy improvisa-tion was adopted, backed by tion was adopted, backed by the the explorations in economic thought. explorations in economic thought. The The repercussions orepercussions of the change made itself evident in the academic sphere f the change made itself evident in the academic sphere as well. as well. As liberalism was sidelined and a more closed economy based As liberalism was sidelined and a more closed economy based on selfon self--sufficiency principle was adopted, Darülfünun with its liberal sufficiency principle was adopted, Darülfünun with its liberal creed Frenchcreed French--educated scholars, fell out of favor due to theeducated scholars, fell out of favor due to the fact that it fact that it could not adapt itself in accordance with the rapid social and cultural could not adapt itself in accordance with the rapid social and cultural transformations the transformations the RRepublic has undergoneepublic has undergone, , as a result of its lack of as a result of its lack of

16 Eyüp Eyüp ÖzverenÖzveren,, “A Hundred Years of German Connection in Turkish Economic Thought: “A Hundred Years of German Connection in Turkish Economic Thought: HistorismusHistorismus and otherwise,” in and otherwise,” in The German Historical School andThe German Historical School and European Economic European Economic ThoughtThought, ed, eds.s. Jose Luis Cardoso, Michalis Psalidopoulos, Jose Luis Cardoso, Michalis Psalidopoulos, ((Routledge, 2015Routledge, 2015), 152.), 152.

17 IbidIbid., ., 152.152.

18 Ibid., 152.Ibid., 152.

Ş E B N E M G E L M E D İ

institutional elasticity

institutional elasticity19, which finally ended up with its repeal by im-, which finally ended up with its repeal by im-plementation plementation of of a universitya university reform.reform.

2.2.2 From Darülfünun to Istanbul UniversityFrom Darülfünun to Istanbul University

Before speaking of the university reform in 1933, it is worth to elabo-

Before speaking of the university reform in 1933, it is worth to elabo-rate more on the historical background of Darülfünun first. rate more on the historical background of Darülfünun first. “Darülfünun” meant “the door of sciences” and the term was used in “Darülfünun” meant “the door of sciences” and the term was used in acknowlacknowledgement of the Latin words “studium generale” or “universitas edgement of the Latin words “studium generale” or “universitas literarum” that literarum” that have been have been used in the continental Europe since the mid-used in the continental Europe since the mid-dle ages and of the French word “universite”.dle ages and of the French word “universite”.20 This institution was first This institution was first brought to agenda brought to agenda in 184in 18477 in the Ottoman Empire.in the Ottoman Empire.21 However, it should However, it should not be regarded as an equivalent to the European universities in the not be regarded as an equivalent to the European universities in the corresponding time, it was more like a school and the only difference corresponding time, it was more like a school and the only difference between this school and religionbetween this school and religion--based madrasah was the presentation based madrasah was the presentation of some general courses in dof some general courses in developing natural science. Besides, its life-eveloping natural science. Besides, its life-time was short; it was closed by the Sultan’s edict because of the ma-time was short; it was closed by the Sultan’s edict because of the ma-neuver of the ulema.neuver of the ulema.22

The second institution was called Darülfünunu Osmani, which was

The second institution was called Darülfünunu Osmani, which was founded in the late years of Abdülhamit II reign. It was founded in the late years of Abdülhamit II reign. It was an academy like an academy like a combination of three madrasah containing theology, literature and a combination of three madrasah containing theology, literature and

19 Eyüp Özveren, “Türkiye’de Üniversite ve İktisat Öğretimi Tartışmalarından Bir Kesit: Eyüp Özveren, “Türkiye’de Üniversite ve İktisat Öğretimi Tartışmalarından Bir Kesit: Kadro Kadro Dergisi Ekseninde Bir KurumDergisi Ekseninde Bir Kurumsal Yenileşme Örneği Olarak İktisat Fakültesi,” sal Yenileşme Örneği Olarak İktisat Fakültesi,” ODTÜ Gelişme Dergisi, ODTÜ Gelişme Dergisi, 26, no. 326, no. 3--4 (1999): 411.4 (1999): 411.

20 Ernst E. Ernst E. Hirsch, Hirsch, Hatıralarım: Kayzer Dönemi, Weimar Cumhuriyeti, Atatürk Ülkesi Hatıralarım: Kayzer Dönemi, Weimar Cumhuriyeti, Atatürk Ülkesi (Ankara: Banka ve Ticaret Hukuku Araştırma Enstitüsü, 1985),(Ankara: Banka ve Ticaret Hukuku Araştırma Enstitüsü, 1985), 241241..

21 NeveNevertheless, rtheless, we have to wait till the 1870s for its implementation and 1908 for its we have to wait till the 1870s for its implementation and 1908 for its development.development. Özveren, “Türkiye’de Üniversite ve İktisat”, 412; cited in Tekeli (1980: Özveren, “Türkiye’de Üniversite ve İktisat”, 412; cited in Tekeli (1980: 7878--89)89)

22 Hirsch, Hirsch, HatıralarımHatıralarım, , 242242.. Prof. Ernst Hirsch was entrusted to make a research Prof. Ernst Hirsch was entrusted to make a research on on “Dünya Üniversiteleri ve Türkiye’de Üniversitenin Gelişmesi” in 1946 by Hasan Ali “Dünya Üniversiteleri ve Türkiye’de Üniversitenin Gelişmesi” in 1946 by Hasan Ali Yücel who was theYücel who was the incumbentincumbent MMinister of inister of EEducation.ducation.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

natural science. In the aftermath of the announcement of the constitu-

natural science. In the aftermath of the announcement of the constitu-tional monarchy in 1908, the law and medicine schools were added as tional monarchy in 1908, the law and medicine schools were added as independent professional fields. Thindependent professional fields. The academy was exposed to heavy e academy was exposed to heavy concussions during the last years of the Wconcussions during the last years of the World orld WWar ar I, especially during I, especially during the armistice years.the armistice years.23 DarülfDarülfüünun had by then lost much credit because nun had by then lost much credit because of its distanced attitude during the war of independence. In addition, of its distanced attitude during the war of independence. In addition, the devaluatthe devaluation of its diploma resulted in a drop in public demand for ion of its diploma resulted in a drop in public demand for enrollment at this practically monopolistic institution of higher learn-enrollment at this practically monopolistic institution of higher learn-ing. When we come to the ing. When we come to the RRepublican era, as Ankara epublican era, as Ankara was chosen aswas chosen as the the capital of Turkey instead of Istanbul, the weight of Darücapital of Turkey instead of Istanbul, the weight of Darülfünun also lfünun also markedly declined.markedly declined.24 A recuperation of the earlier prestige could not be A recuperation of the earlier prestige could not be materialized. The footsteps of change were transpired and manifested materialized. The footsteps of change were transpired and manifested itself immediately one year before the reform. The 1932 budget of the itself immediately one year before the reform. The 1932 budget of the institution was only certified oninstitution was only certified on condition of a reform and reorganiza-condition of a reform and reorganiza-tion, since the expected improvement could never have been achieved tion, since the expected improvement could never have been achieved till then.till then.25

The disfavor of Darülfünun led to a shift of the center of the intellec-

The disfavor of Darülfünun led to a shift of the center of the intellec-tual debates to nontual debates to non--academic platforms among which there are journalacademic platforms among which there are journals s and associations. and associations. A significant A significant point point here here is thatis that,, the intellectual move-the intellectual move-ment also referred to a spatial shift, from ment also referred to a spatial shift, from IIstanbul to Ankara.stanbul to Ankara.26 For in-For in-stance, one of the most influential journals that campaigned for a uni-stance, one of the most influential journals that campaigned for a uni-versity reform, versity reform, KadroKadro27, was being publis, was being published in Ankara.hed in Ankara.28 The The Kadro Kadro

23 Hirsch, Hirsch, HatıralarımHatıralarım, , 242242..

24 Özveren,Özveren, “A Hundred Years of German Connection,” “A Hundred Years of German Connection,” 154154..

25 Hirsch, Hirsch, HatıralarımHatıralarım,, 242242..

26 In fact, there were already some institutions which included economics courses in In fact, there were already some institutions which included economics courses in Ankara, namely The Faculty of Law, Mülkiye and Yüksek Ziraat EnstitüsüAnkara, namely The Faculty of Law, Mülkiye and Yüksek Ziraat Enstitüsü.. Fındıkoğlu,Fındıkoğlu, Türkiye’de İktisat TedrisatıTürkiye’de İktisat Tedrisatı, , 5656..

27 The authors of The authors of KadroKadro were mostly proponents of thewere mostly proponents of the statist policies. The journal was statist policies. The journal was ideologically on the line of melting Kemalism and Marxism in the same pot. Although ideologically on the line of melting Kemalism and Marxism in the same pot. Although KadroKadro was a very influential journal in shaping public opinion, its audience was limited was a very influential journal in shaping public opinion, its audience was limited and it was shortand it was short--lived due to the ideological delived due to the ideological deviations. In the course of time, the criti-viations. In the course of time, the criti-cal voices were raised against the policies of the government and the journal was abol-cal voices were raised against the policies of the government and the journal was abol-ished in 193ished in 19355. For detailed information about . For detailed information about KadroKadro, see İlhan Tekeli and Selim İlkin, see İlhan Tekeli and Selim İlkin,,

Ş E B N E M G E L M E D İ

members like Şevket Süreyya Aydemir and Burhan Asaf Belge, were

members like Şevket Süreyya Aydemir and Burhan Asaf Belge, were publishing articles attacking the liberal economicspublishing articles attacking the liberal economics 29, , which was charac-which was charac-terized asterized as “Cavit Bey Economics”. The liberal way of doing economics “Cavit Bey Economics”. The liberal way of doing economics was even considered as was even considered as kürsü kürsü politikacılpolitikacılığıığı (chair p(chair politics)olitics) by Aydemir.by Aydemir.30 The FrenchThe French--influenced oldinfluenced old--fashioned economists were held responsible fashioned economists were held responsible for the sorry state of economics.for the sorry state of economics.31

Indeed,

Indeed, Kadro’Kadro’s dissent for liberal economics was rooted in a deeper s dissent for liberal economics was rooted in a deeper theoretical causality. theoretical causality. The ideological tendency ofThe ideological tendency of Kadro Kadro reprrepresented a esented a doctrinal mix that involves doctrinal mix that involves the imprints of the imprints of ““German Historical School, German Historical School, protectionism, Marxism, developedprotectionism, Marxism, developed--underdeveloped conflicts, the will underdeveloped conflicts, the will to overcome economic, technological, scientific dependency and the to overcome economic, technological, scientific dependency and the realization of the conditions of a realrealization of the conditions of a real economic independenceeconomic independence..””32 As be-As be-ing the premise theorists of the dependency school, ing the premise theorists of the dependency school, KadroKadro members members were aiming to realize a transition from a dependent economy to a na-were aiming to realize a transition from a dependent economy to a na-tional economy.tional economy.33 In this process, the principal responsibility was on the In this process, the principal responsibility was on the

Kadro

Kadrocuları ve cuları ve KadroKadro’yu Anlamak’yu Anlamak: Bir Cumhuriyet Öyküsü: Bir Cumhuriyet Öyküsü (İstanbul: Türkiye Ekonomik (İstanbul: Türkiye Ekonomik ve Toplumsal Tarih Vakfı, 2003).ve Toplumsal Tarih Vakfı, 2003).

28 Özveren, Özveren, “A Hundred Years of German Connection,” “A Hundred Years of German Connection,” 152152..

29 Ragıp Ege and Harald Hagemann, “The ModerRagıp Ege and Harald Hagemann, “The Modernisation of the Turkish University after nisation of the Turkish University after 1933: The Contributions of Refugees from Nazism”, 1933: The Contributions of Refugees from Nazism”, The European Journal of the Histo-The European Journal of the Histo-ry of Economic Thought, ry of Economic Thought, (2012): 8. Ege and Hagemann mentions Burhan Asaf Belge (2012): 8. Ege and Hagemann mentions Burhan Asaf Belge argument: “argument: “IIf we pay attention, we observe that throuf we pay attention, we observe that throughout the world liberalism is ghout the world liberalism is completely defeated, being liquidated’: ‘it is necessary to destroy all the concepts and completely defeated, being liquidated’: ‘it is necessary to destroy all the concepts and all the institutions of liberalism, and necessarily its concept of freedom.” Ege and all the institutions of liberalism, and necessarily its concept of freedom.” Ege and Hagemann, “The ModernisationHagemann, “The Modernisation,,” 8. cited ” 8. cited inin Burhan AsBurhan Asaf (1933baf (1933b:: 26).26).

30 Özveren, “Türkiye’de ÜniverÖzveren, “Türkiye’de Üniversite ve İktisatsite ve İktisat,,” 402” 402--403. Ragıp Ege and Harald Hagemann 403. Ragıp Ege and Harald Hagemann in their in their article alsoarticle also state that “the Darülfünun professor is accused of promoting the state that “the Darülfünun professor is accused of promoting the liberty and the egoism of the individual to the detriment of the state.“liberty and the egoism of the individual to the detriment of the state.“ Ege and Hage-Ege and Hage-mann, mann, “The Modernisation“The Modernisation,,” ” 99..

31 Özveren, “A Hundred Years of German ConnectionÖzveren, “A Hundred Years of German Connection,,” 154” 154--155. Özveren refers to Şevket 155. Özveren refers to Şevket Süreyya Aydemir who asserted that one of those oldSüreyya Aydemir who asserted that one of those old--fashioned economists is İbrahim fashioned economists is İbrahim Fazıl Pelin. (Aydemir, 1933a,11Fazıl Pelin. (Aydemir, 1933a,11; ; 1933b1933b--15). “15). “AA large extent the nonlarge extent the non--existence of anexistence of an autonomous Faculty of Economics in Darautonomous Faculty of Economics in Darüülflfüünun was due to the dominance of the nun was due to the dominance of the French traditionFrench tradition..” Fındıkoğlu, ” Fındıkoğlu, Türkiye’de İktisat TedrisatıTürkiye’de İktisat Tedrisatı Tarihçesi, Tarihçesi, 6969..

32 EgeEge and Hagemannand Hagemann, “The Moderni, “The Modernissationation,,”” 88, c, citedited inin Dölen Dölen ((2010b: 52010b: 5––2323).).

33 Ibid.,Ibid., 88, , ccited ited inin ŞeŞevket Süreyya vket Süreyya ((1933: 111933: 11).).

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

state in stimulat

state in stimulating and framing economic phenomenon which would ing and framing economic phenomenon which would come up with the establishment of a state economy. Prioritizing the come up with the establishment of a state economy. Prioritizing the “good of the nation and superior interests of the state”, the role of “good of the nation and superior interests of the state”, the role of avantgarde in construction of a theoretical and doctrinal base for theavantgarde in construction of a theoretical and doctrinal base for the inkılinkılââpp areare emphasized. Despite the fact that some of them were former emphasized. Despite the fact that some of them were former Marxists and communists, the conceptual framework of the periphery Marxists and communists, the conceptual framework of the periphery status oriented them to identify the society as a classless society with status oriented them to identify the society as a classless society with the appearance of “nations without conflictsthe appearance of “nations without conflicts”,”,34 which was compatible which was compatible with the perspective of thewith the perspective of the currentcurrent ruling ideology as well.ruling ideology as well.

Probably,

Probably, the demands of the demands of KadroKadro for a new institutional framework for a new institutional framework made itself most evident in İsmail Hüsrev Tökin’s book made itself most evident in İsmail Hüsrev Tökin’s book İktisat Nasıl Oku-İktisat Nasıl Oku-tulmalı?tulmalı?.. The university idea of The university idea of KadroKadro was resembling the German mod-was resembling the German mod-el, a research university like Humboldt which was expected to generate el, a research university like Humboldt which was expected to generate new knowledge and make contributions for the development of the na-new knowledge and make contributions for the development of the na-tion.tion.35 As for the methodology, Tökin, in line with the German Historical As for the methodology, Tökin, in line with the German Historical School, empSchool, emphasizehasizedd the primacy of inductivist methods. A critical im-the primacy of inductivist methods. A critical im-portance of this book is that it exposed the necessity of emancipation of portance of this book is that it exposed the necessity of emancipation of economics from the faculty of law.economics from the faculty of law.36 Moreover, what Moreover, what KadroKadro uttereduttered mostmost was the was the idea idea that high education must serve for public that high education must serve for public benefit, which benefit, which undermined the idea of “science is pursued for the sake of science”. In-undermined the idea of “science is pursued for the sake of science”. In-stead, the idea that “science was henceforth ‘invited’ to serve the stead, the idea that “science was henceforth ‘invited’ to serve the inkılâp.”inkılâp.”37 was in demand. This emphasis of was in demand. This emphasis of KadroKadro38 might have been might have been a a

34 EgeEge and Hagemannand Hagemann, “The Moderni, “The Modernissationation,,”” 88..

35 According to Tekeli (2010: 141), this desire to develop a Humboldtian university was According to Tekeli (2010: 141), this desire to develop a Humboldtian university was also present along the members of the CUP although it was not explicitly mentioned. also present along the members of the CUP although it was not explicitly mentioned. EgeEge andand HagemannHagemann,, ““The ModerniThe Modernissationation,,”” 33..

36 Özveren, Özveren, “Türkiye’de Üniversite ve İktisat“Türkiye’de Üniversite ve İktisat,,”” 411, cited in Tökin (1931: 5411, cited in Tökin (1931: 5--6).6).

37 Ege and HagemannEge and Hagemann, “The Moderni, “The Modernissationation,,”” 1010; Özveren, ; Özveren, “Türkiye’de Üniversite ve “Türkiye’de Üniversite ve İktisatİktisat,,”” 405405--406.406.

38 Ege and Hagemann briefly summarize the impact of Ege and Hagemann briefly summarize the impact of KadroKadro in refoin reforrm by the following m by the following arguments: “Even if the real influence on Kemalist policy of the radical economic arguments: “Even if the real influence on Kemalist policy of the radical economic stance of stance of KadroKadro’’s writers was limited, their ideological opposition to liberalism did s writers was limited, their ideological opposition to liberalism did tend to discredit Darülfünun’s professors (müderris) who were seen as proponents of tend to discredit Darülfünun’s professors (müderris) who were seen as proponents of libeliberal positions. The examination of ral positions. The examination of KadroKadro’s arguments concerning economic issues ’s arguments concerning economic issues

Ş E B N E M G E L M E D İ

significant acceleratory effect in

significant acceleratory effect in accomplishing the university reform for accomplishing the university reform for the sake of social change. the sake of social change.

Although the importance of non

Although the importance of non--academic platforms cannot be dis-academic platforms cannot be dis-regarded when we think of the enrichment of economic thought, Musta-regarded when we think of the enrichment of economic thought, Musta-fa Kemal Atatürk was in search of a structural reform at fa Kemal Atatürk was in search of a structural reform at the university the university level as well.level as well.39 Aside from the objective and cultural obsoleteness of Aside from the objective and cultural obsoleteness of Darülfünun, the main agenda was maintaining secularism; Darülfünun, the main agenda was maintaining secularism; hence, hence, the the presence of a tension between the academics that are bound to the Is-presence of a tension between the academics that are bound to the Is-lamic thought and Atatlamic thought and Atatüürk’s perspectrk’s perspective of science within the ive of science within the RRepubli-epubli-can regime mightcan regime might have alsohave also bebeen aen a significant catalyzer.significant catalyzer.40 A desired re-A desired re-form was fundamentally in pursuit of ending the “madrasah mentality” form was fundamentally in pursuit of ending the “madrasah mentality” that had seized the university education up until then. For that purpose, that had seized the university education up until then. For that purpose, a pedagogya pedagogy Professor in Geneva, Albert MalcheProfessor in Geneva, Albert Malche41 was called. He collect-was called. He collect-ed his impressions and advisory reform package in a detailed report. At ed his impressions and advisory reform package in a detailed report. At the end of that report and with reference to the concept of university in the end of that report and with reference to the concept of university in Western Europe, Malche asserted that it is wrong toWestern Europe, Malche asserted that it is wrong to consider university consider university as an institution merely responsible for the as an institution merely responsible for the distribution of knowledgedistribution of knowledge. . Instead, it must be entrusted with the teaching of the methods of Instead, it must be entrusted with the teaching of the methods of scien-scien-

and liberalism provides a clear picture of the ideological context in which the institu-

and liberalism provides a clear picture of the ideological context in which the institu-tion of Dartion of Darüülflfüünun was at this time evaluated. It has to be remembered that support-nun was at this time evaluated. It has to be remembered that support-ers of ers of the new Republic, and especially writers for the new Republic, and especially writers for KadroKadro, evaluated all Ottoman insti-, evaluated all Ottoman insti-tutions with reference to a sacred concept: ‘inkıltutions with reference to a sacred concept: ‘inkılââp’: revolution, radical reform. An p’: revolution, radical reform. An attitude thought to be opposed to inkılattitude thought to be opposed to inkılââp, or simply somewhat critical of its necessity p, or simply somewhat critical of its necessity andand its beneficial character, was immediately condemned, and any institution accused its beneficial character, was immediately condemned, and any institution accused of such thinking was doomed to abolition.” Egeof such thinking was doomed to abolition.” Ege and Hagemann, “and Hagemann, “The ModerniThe Modernissationation,” ,” 77..

39 Özveren, referring to İlkin (1972:6Özveren, referring to İlkin (1972:6--7)7) argues that the idea of founding an independenargues that the idea of founding an independent t faculty of economics was first mentioned by Kazım Karabekir in İzmir Economic Con-faculty of economics was first mentioned by Kazım Karabekir in İzmir Economic Con-gress 1923.gress 1923. Özveren, “Türkiye’deÖzveren, “Türkiye’de Üniversite ve İktisatÜniversite ve İktisat,,”” 412.412.

40 Hirsch,Hirsch, Hatıralarım, Hatıralarım, 244244..

41 Malche was also a member of Geneva City Council. He made preliminary studiesMalche was also a member of Geneva City Council. He made preliminary studies on on cadre plans, organization of courses and examination, foundation of institutes and cadre plans, organization of courses and examination, foundation of institutes and clinics. He was assigned to map the deficiencies just a few months before Hitler came clinics. He was assigned to map the deficiencies just a few months before Hitler came into power.into power. FritzFritz Neumark,Neumark, Boğaziçine Sığınanlar: Türkiye’ye İltica eden Alman İlimBoğaziçine Sığınanlar: Türkiye’ye İltica eden Alman İlim Siyaset ve Sanat Adamları 1933Siyaset ve Sanat Adamları 1933--1953 1953 (İstanbul: Neden Kitap, 2008),(İstanbul: Neden Kitap, 2008), 1515. .

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

tific thinking.

tific thinking. An institution is expected to present itself within a scien-An institution is expected to present itself within a scien-tific mindset in tific mindset in order to deserve the naming “university” argued Malche; order to deserve the naming “university” argued Malche; unless, emancipation is impossible.unless, emancipation is impossible.42

In the aftermath of Malche’s report on the vitalism of a reform, the

In the aftermath of Malche’s report on the vitalism of a reform, the government decided to government decided to implementimplement a drastic reform process even more a drastic reform process even more than what Malche propothan what Malche propoundedunded. It was the total viewpoint of scientific . It was the total viewpoint of scientific thinking that ought to be transformed.thinking that ought to be transformed.43 The role of the academics was The role of the academics was redefined in a sense. “The new Istanbul University should renounce ivo-redefined in a sense. “The new Istanbul University should renounce ivo-ry tower academics and engagery tower academics and engage instead in the shaping of national poli-instead in the shaping of national poli-ciescies together with the public” argued the together with the public” argued the KadroKadro membersmembers44 and this ex-and this ex-pression seems to be taken into consideration in effect. Indeed, this pression seems to be taken into consideration in effect. Indeed, this viewpoint was also significant in the sense that it drew attention to the viewpoint was also significant in the sense that it drew attention to the importance of anchor of academics and public polimportance of anchor of academics and public policy makers in eco-icy makers in eco-nomic decisions.nomic decisions.45

Finally, in the tenth year of the

Finally, in the tenth year of the RRepublic, a new law prescribing the epublic, a new law prescribing the foundation of Istanbul University was introduced in August 1933. Reşit foundation of Istanbul University was introduced in August 1933. Reşit Galip, the Galip, the incumbentincumbent minister of education and minister of education and the the General Secretary of General Secretary of the Turkthe Turkish Society of Historyish Society of History46 emphasized emphasized that the newly founded that the newly founded university was completely a new institution with its own tradition that university was completely a new institution with its own tradition that has no relation with the extinguished Darülfünun. The main mission of has no relation with the extinguished Darülfünun. The main mission of the university (this word was decided to be used until athe university (this word was decided to be used until a pure Turkish pure Turkish

42 Hirsch, Hirsch, Hatıralarım, Hatıralarım, 242242..

43 Özveren, “A Hundred YearsÖzveren, “A Hundred Years,,” 155” 155. . Although we cannot say that it was all Although we cannot say that it was all KadroKadro’s ’s influence, we cannot disregard the effect of influence, we cannot disregard the effect of KadroKadro in framing publicin framing public opinionopinion....

44 Özveren, “A Hundred YearsÖzveren, “A Hundred Years,,” 155” 155,, cited from Belge (1933c: 25cited from Belge (1933c: 25--28). This issue is also 28). This issue is also referred by Muhlis Ete as follows: “The teaching of the old economics was not based on referred by Muhlis Ete as follows: “The teaching of the old economics was not based on national economy. Facts were analyzed from a cosmopolitan view, instenational economy. Facts were analyzed from a cosmopolitan view, instead of the na-ad of the na-tional one. Even this cosmopolitan conception merely repeated French textbooks and tional one. Even this cosmopolitan conception merely repeated French textbooks and French authors. Once a professor made an effort to introduce national events and data French authors. Once a professor made an effort to introduce national events and data into his teaching. But even in this case the attempt remained superficial, into his teaching. But even in this case the attempt remained superficial, and very far and very far from the realities of the national life” Ege and Hagemann, “The Modernisationfrom the realities of the national life” Ege and Hagemann, “The Modernisation,,” 9” 9--1010,, quotedquoted in Muhlis Etein Muhlis Ete ((1933: 461933: 46).).

45 Özveren recalls the emphasis of Karl Polanyi in going beyond the market mechanism as Özveren recalls the emphasis of Karl Polanyi in going beyond the market mechanism as a goal. Özveren, a goal. Özveren, “Türkiye’de Ün“Türkiye’de Üniversite ve İktisativersite ve İktisat,,”” 406.406.

46 EgeEge and Hagemann,and Hagemann, “The Modernisation,” “The Modernisation,” 1212..

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phrase will be found

phrase will be found insteadinstead) was mentioned as) was mentioned as ““generation of a pure generation of a pure scientific culturescientific culture””; and above all, university was considered as a source ; and above all, university was considered as a source and the focal point of speculative thinking.and the focal point of speculative thinking.47 Ernst Hirsch, an Ernst Hirsch, an émigré émigré German law professor who was German law professor who was entrusted entrusted by Hasan Ali Yücel by Hasan Ali Yücel to make a to make a research on the development of universities around the world and Tur-research on the development of universities around the world and Tur-key, also adds that the historical meaning of foundation of Istanbul Uni-key, also adds that the historical meaning of foundation of Istanbul Uni-versity can be comprehended as versity can be comprehended as a naissance of the very first university a naissance of the very first university desigdesigned visned vis--aa--vis Western samplesvis Western samples then.then.48 This transformation was This transformation was named as university reform; however, inamed as university reform; however, in considering all the change that n considering all the change that took placetook place and and the abolition of Darülfunun, the abolition of Darülfunun, it it seems more like an “act of seems more like an “act of revolution” instead of an “act of reform”.revolution” instead of an “act of reform”.49

2.2.3 EmEmancipation of ancipation of ““Economics” from “Law”Economics” from “Law”

For the matter of an individual faculty of economics, there was no direct

For the matter of an individual faculty of economics, there was no direct inscription in Malche’s report but the new inscription in Malche’s report but the new RRepublic was obviously in epublic was obviously in need of a systematically wellneed of a systematically well--educated human resource acquiring com-educated human resource acquiring com-prehensiprehensive economic knowledge. During the early years of the ve economic knowledge. During the early years of the RRepublic, epublic, the economics education was within the structure of the faculty of law the economics education was within the structure of the faculty of law and it was hard to achieve this goal as long as the economics courses and it was hard to achieve this goal as long as the economics courses remained just as a part of the faculty of law.remained just as a part of the faculty of law. In adIn addition, this fact obvi-dition, this fact obvi-ously was a matter of considering economic phenomenon via the lenses ously was a matter of considering economic phenomenon via the lenses of law which indeed reduced having a good grasp of many aspects in of law which indeed reduced having a good grasp of many aspects in economics. In the viewpoint of Ziyaüddin Fahri Fındıkoğlu, a sociology economics. In the viewpoint of Ziyaüddin Fahri Fındıkoğlu, a sociology professor and academic in tprofessor and academic in the prospective faculty of economics, the he prospective faculty of economics, the prominent reason behind the need for formation of a new faculty was prominent reason behind the need for formation of a new faculty was

47 Hirsch, Hirsch, Hatıralarım, Hatıralarım, 243243..

48 IbidIbid., ., 244.244.

49 Ege and Hagemann, “The ModernisationEge and Hagemann, “The Modernisation,,” 11” 11, cited in, cited in Emre Dölen, Emre Dölen, Türkiye Üniversite Türkiye Üniversite Tarihi 1. Osmanlı Döneminde Darülfünun 1863Tarihi 1. Osmanlı Döneminde Darülfünun 1863––19221922 (İstanbul: Bilgi Üniversitesi Yayın-(İstanbul: Bilgi Üniversitesi Yayın-ları, 2009), 29ları, 2009), 29--32.32.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

portrayed as the secondary importance

portrayed as the secondary importance given to thegiven to the economic discipline economic discipline within the faculty of law. Just the 16 within the faculty of law. Just the 16 percentpercent of the total courses were of the total courses were devdevoted to economic and social disciplines. Hence, professors were oted to economic and social disciplines. Hence, professors were bounded to confine with the most primordial issues of economics with-bounded to confine with the most primordial issues of economics with-out teaching the important special branches and social problems.out teaching the important special branches and social problems.50

Besides, a very central issue was the difference between t

Besides, a very central issue was the difference between the meth-he meth-odologies of each discipline. Law has a normative character whereas odologies of each discipline. Law has a normative character whereas economics is based on causal relations, namelyeconomics is based on causal relations, namely thethe causality principle. causality principle. Law is dogmatic, abstract and inferential whereas economics is an em-Law is dogmatic, abstract and inferential whereas economics is an em-pirical social science that requires a copirical social science that requires a combination between theory and mbination between theory and empiricism. As the teachings of each discipline deepen, the difference in empiricism. As the teachings of each discipline deepen, the difference in methodology appears more clearly.methodology appears more clearly.51 In addition, the morphological In addition, the morphological change in the structure of the country should be kept in mind as well. change in the structure of the country should be kept in mind as well. Fındıkoğlu asserFındıkoğlu asserts that every step that moves away from the liberal ts that every step that moves away from the liberal economy regime (particularly the implementation of fiveeconomy regime (particularly the implementation of five--year devel-year devel-opment plans) opment plans) requiredrequired the emancipation of the discipline of economics the emancipation of the discipline of economics from law. Developing the national economy is considered as a primarfrom law. Developing the national economy is considered as a primary y purpose of state policies, as the principle of purpose of state policies, as the principle of éétatism was acknowledged tatism was acknowledged and a rapid industrialization process and a rapid industrialization process wawas of top priority. Hence, it can s of top priority. Hence, it can be said that state be said that state wawas much more active in the field of economy in the s much more active in the field of economy in the current context.current context.52 Another reason was sAnother reason was set forth as the increase in the et forth as the increase in the amount of the research material. Although there wereamount of the research material. Although there were severalseveral institu-institu-tions that allowtions that alloweded some courses on economics, it was very probable some courses on economics, it was very probable that they could not provide a methodology based on a strong theory that they could not provide a methodology based on a strong theory than practice.than practice.53 By conBy constituting an individual faculty of economics, “the-stituting an individual faculty of economics, “the-ory ory for the sake of theoryfor the sake of theory”” (nazariye, nazariye içindir)(nazariye, nazariye içindir) principle would principle would be adopted in order to shift to “creation” level in the field of economic be adopted in order to shift to “creation” level in the field of economic culture. Thanks to the nonculture. Thanks to the non--existence of the withstanding trexistence of the withstanding traditions in aditions in

50 Fındıkoğlu, Fındıkoğlu, Türkiye’de İktisat Tedrisatı, Türkiye’de İktisat Tedrisatı, 6666..

51 IbidIbid.., 66, 66..

52 IbidIbid.., 67, 67..

53 IbidIbid.,., 6868..

Ş E B N E M G E L M E D İ

Turkey which had undergone a metamorphosis

Turkey which had undergone a metamorphosis54, it became much easi-, it became much easi-er to establish this new faculty.er to establish this new faculty.55

Apart from Fındıkoğlu, another scientist and

Apart from Fındıkoğlu, another scientist and KadroKadro member İsmail member İsmail Hüsrev TökinHüsrev Tökin56 also criticized the fact that economics courses were giv-also criticized the fact that economics courses were giv-en within the faculty of law and stresseen within the faculty of law and stressedd on the need for an independ-on the need for an independ-ent faculty of economics: ent faculty of economics:

In today’s educational sy

In today’s educational system, economics education could not stem, economics education could not properly be done. We don’t have a faculty of economics. Courses properly be done. We don’t have a faculty of economics. Courses on economics were patched to law. In addition, economics teach-on economics were patched to law. In addition, economics teach-ing in commercial schools are not in accordance with the needs. ing in commercial schools are not in accordance with the needs. In order to bring up minds capIn order to bring up minds capable of understanding the eco-able of understanding the eco-nomic requirements, constructing economic policies and manag-nomic requirements, constructing economic policies and manag-ing economic enterprises, we have to separate the teaching of ing economic enterprises, we have to separate the teaching of economics from law by constituting a new faculty of economics. economics from law by constituting a new faculty of economics. In addition to the fact that the teachingsIn addition to the fact that the teachings are not interrelated, are not interrelated, they are not related with the concrete phenomena, they are all they are not related with the concrete phenomena, they are all disconnected from the concrete environment. disconnected from the concrete environment. AA student is not student is not able to concretize the knowledge heable to concretize the knowledge he/she/she gets and become gets and become stumped in the face of concrete incidents about the estumped in the face of concrete incidents about the economy of conomy of the country. Hence, hethe country. Hence, he/she/she has to grasp the way of observing the has to grasp the way of observing the economic phenomena independently, relating them to the eco-economic phenomena independently, relating them to the eco-nomic theory. Here, theory should play a keynomic theory. Here, theory should play a key role in deducing the role in deducing the laws based on the observations, not an end but as a mean.laws based on the observations, not an end but as a mean. Ac-Ac-cordingly, the purpose of the economics education should be cordingly, the purpose of the economics education should be

54 Fındıkoğlu, Fındıkoğlu, Türkiye’de İktisat TedrisatıTürkiye’de İktisat Tedrisatı, 6, 699..

55 Ibid.Ibid., 69. Fındıkoğlu claims that even in France p, 69. Fındıkoğlu claims that even in France people began speaking up on the eople began speaking up on the necessity of faculties of economics, in Britain and America these faculties have existed necessity of faculties of economics, in Britain and America these faculties have existed for a long time and in Germany, Italy and Switzerland, newly formed. Fındıkoğlu, for a long time and in Germany, Italy and Switzerland, newly formed. Fındıkoğlu, Tü-Tü-rkiye’de İktisat Tedrisatırkiye’de İktisat Tedrisatı, 69., 69.

56 Özveren, “A HundrÖzveren, “A Hundred Yearsed Years,,” 155. Özveren claims that although Tökin is Soviet” 155. Özveren claims that although Tökin is Soviet--educated, his proposals on how economics should be taught were resembling the educated, his proposals on how economics should be taught were resembling the German practice.German practice.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

teaching the method of research and organize the founding, not

teaching the method of research and organize the founding, not rote learning.rote learning.57

Muhlis Ete, a German

Muhlis Ete, a German--educated member of the faculty influenced by educated member of the faculty influenced by Friedrich ListFriedrich List,,58 shares his opinion shares his opinion as followsas follows: :

The new mindset of the he new mindset of the RRepublican regime is epublican regime is the the creaticreation ofon of a a new segment of society concerned with economics. But is that new segment of society concerned with economics. But is that enough? Naturally no, for a nation with 13.5 million population. enough? Naturally no, for a nation with 13.5 million population. Then we will try to enhance this community and this can primar-Then we will try to enhance this community and this can primar-ily bily be provided by the existence of schools of commerce and eco-e provided by the existence of schools of commerce and eco-nomics.nomics.59

Here

Here oneone can see that awakening about the methodological and contex-can see that awakening about the methodological and contex-tual difference of economics as a fieldtual difference of economics as a field, , made itself evident among many made itself evident among many scholars. The reasons behind the emancipation of escholars. The reasons behind the emancipation of economics from law conomics from law were well grounded via the discourses mentioned above. In accordance were well grounded via the discourses mentioned above. In accordance with the increasing emphasis on the necessity of a qualified labor force with the increasing emphasis on the necessity of a qualified labor force in the domain of economics, the labor pains of a new faculty of econom-in the domain of economics, the labor pains of a new faculty of econom-ics could not be overlookeics could not be overlooked anymore. Even so, we have to wait for d anymore. Even so, we have to wait for threethree years after the foundation of the years after the foundation of the Istanbul Istanbul University for the discipline of University for the discipline of economics to blow the cobwebs away and obtain an autonomous faculty economics to blow the cobwebs away and obtain an autonomous faculty for itself.for itself.

57 İsmail Hüsrevİsmail Hüsrev TökinTökin, , İktisat Nasıl Okutulmalı?İktisat Nasıl Okutulmalı? ((Ankara, 1931Ankara, 1931), ), 55--77..

58 Georg Friedrich List is Georg Friedrich List is a nineteenth century Germana nineteenth century German--U.S. economist who is known as U.S. economist who is known as thethe forefather of German Historical School of Economics. He is mostly recognized by forefather of German Historical School of Economics. He is mostly recognized by his writings on national prosperity and creation of wealth based on the nation’s ability his writings on national prosperity and creation of wealth based on the nation’s ability of developing productiveof developing productive forces.forces.

59 Çakır and Akar, Çakır and Akar, “İktisat Eğitiminin Beşiği“İktisat Eğitiminin Beşiği,” 277, quoted in ,” 277, quoted in MuhlisMuhlis Ete,Ete, “Almanya’da “Almanya’da İktisat ve Ticaret İlimleri Tahsiliİktisat ve Ticaret İlimleri Tahsili,,” ” İktisatçıİktisatçı,, 1, no1, no.. 8, 98, 9: (: (119119--120).120).

Ş E B N E M G E L M E D İ

2.2.4 Foundation of the Faculty of EconomicsFoundation of the Faculty of Economics

As already

As already mentionedmentioned,, therethere were were various various institutionsinstitutions whichwhich enriched enriched their curricula by the economics courses. Among them there are High their curricula by the economics courses. Among them there are High School of Commerce (İstanbul Yüksek Ticaret ve İktisat Mektebi), the School of Commerce (İstanbul Yüksek Ticaret ve İktisat Mektebi), the Faculty of Law in Darülfünun and the School of Political Sciences (Mül-Faculty of Law in Darülfünun and the School of Political Sciences (Mül-kiye)kiye)..60 However, Fındıkoğlu argueHowever, Fındıkoğlu arguedd thatthat it was hard for them to satisfy it was hard for them to satisfy the needs of a new methodology which demandthe needs of a new methodology which demandeded a strong theoretical a strong theoretical base rather than practice.base rather than practice.61 In fact, in accordance with this necessity, an In fact, in accordance with this necessity, an Institute of Economics and Sociology (İktisat ve İçtimaiyyat Enstitüsü) Institute of Economics and Sociology (İktisat ve İçtimaiyyat Enstitüsü) was foundwas founded in 1934 and began to publish materials which were later ed in 1934 and began to publish materials which were later transformed into books or booklets.transformed into books or booklets.62 Although the presence of such an Although the presence of such an institute was not sufficient to satisfy the need for an independent facul-institute was not sufficient to satisfy the need for an independent facul-ty, it acted as an intermediate form and was significaty, it acted as an intermediate form and was significant for its publica-nt for its publica-tions. tions. ItIt wawas also important in the sense that most of the writings of s also important in the sense that most of the writings of Wilhelm Röpke, a central figure of the faculty of economics, were pub-Wilhelm Röpke, a central figure of the faculty of economics, were pub-lished by the institute. The institute was transformed into an independ-lished by the institute. The institute was transformed into an independ-ent faculty of economics byent faculty of economics by the efforts of Ömer Celal Sarc, a Germany the efforts of Ömer Celal Sarc, a Germany educated professor who became the first dean of the faculty.educated professor who became the first dean of the faculty.63 In his In his speech, he emphasized his expectations from the faculty with the fol-speech, he emphasized his expectations from the faculty with the fol-lowing remarks: lowing remarks:

60 Mülkiye moved from İstanbul to Ankara in 1935Mülkiye moved from İstanbul to Ankara in 1935. . EgeEge and Hagemann,and Hagemann, “The Modernisa-“The Modernisa-tion,” tion,” 1717..

61 Fındıkoğlu,Fındıkoğlu, Türkiye’de İktisat, Türkiye’de İktisat, 6868..

62 Among the publications, there are Among the publications, there are book including book including conference texts namely conference texts namely Wilhelm Wilhelm Röpke, Röpke, ÖÖkonominin Bugünkü Meselelerikonominin Bugünkü Meseleleri (İstanbul: İstanbul Üniversitesi Hukuk Fakülte-(İstanbul: İstanbul Üniversitesi Hukuk Fakülte-si İktisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934si İktisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934;; Fritz Neumark, Fritz Neumark, Komün Bilgisinin Esas Komün Bilgisinin Esas MeseleleriMeseleleri ((İstanbulİstanbul: İstanbul Üniversitesi, 1936). : İstanbul Üniversitesi, 1936). There are also colloquium texts, There are also colloquium texts, monographies and questionairres. monographies and questionairres. For further explanations seeFor further explanations see Fındıkoğlu, Fındıkoğlu, Türkiye’de Türkiye’de İktisatİktisat, , 7979--80.80.

63 Neumark, Neumark, Boğaziçine SığınanBoğaziçine Sığınanlarlar, 75. , 75. Sarc was a student of Werner Sombart, who left Sarc was a student of Werner Sombart, who left an influential legacy on academics in Istanbul University particularly for his method of an influential legacy on academics in Istanbul University particularly for his method of research in understanding capitalism by focusing on mentality dynamics. Ömer Celal research in understanding capitalism by focusing on mentality dynamics. Ömer Celal Sarc, “Werner SombartSarc, “Werner Sombart,,” ” İÜİFİÜİFM M 3, no.3, no. 11--2 (1942):2 (1942): 60, 62.60, 62.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

The faculty of economics would bring up young generations t

The faculty of economics would bring up young generations that hat will make research on unworked economic issues by scientifical-will make research on unworked economic issues by scientifical-ly fixing the realities of Turkey. These wellly fixing the realities of Turkey. These well--educated people will educated people will manage the fabrics, industrial firms; work on the fiscal and eco-manage the fabrics, industrial firms; work on the fiscal and eco-nomic organizations of the banks, which all perform the devnomic organizations of the banks, which all perform the devel-el-opment of the country.opment of the country.64

Hence, one might infer the pointed relation between the development of

Hence, one might infer the pointed relation between the development of a nation and a wella nation and a well--established economics education. Such a binding established economics education. Such a binding was present in the opening speech of Cemil Bilsel, the rector of Istanbul was present in the opening speech of Cemil Bilsel, the rector of Istanbul University when tUniversity when the Faculty of Economics finally founded in 1936he Faculty of Economics finally founded in 193665. He . He mentioned the central role of economy in the current conjuncture and mentioned the central role of economy in the current conjuncture and significance of generating extensive knowledge on the economic phe-significance of generating extensive knowledge on the economic phe-nomenon as follows: nomenon as follows:

As we see both the rise and fall of nations are

As we see both the rise and fall of nations are dependent on dependent on economy. Economics has never been that dominant on the social economy. Economics has never been that dominant on the social phenomenon and personal relations as it is today. For that rea-phenomenon and personal relations as it is today. For that rea-son, it can be said that the present century is the century of eco-son, it can be said that the present century is the century of eco-nomics. The reason is obvious, the main causes of thnomics. The reason is obvious, the main causes of the Great War e Great War are economic and economy is the most powerful factor that are economic and economy is the most powerful factor that charts out the frame of the postcharts out the frame of the post--war period. Both the public and war period. Both the public and

64 Çakır and Akar, “İktisat Eğitiminin,” 281, quoted in Çakır and Akar, “İktisat Eğitiminin,” 281, quoted in Ömer CelalÖmer Celal Sarc, “İktisat Fakültesi Sarc, “İktisat Fakültesi AçılırkenAçılırken,,” ” Üniversite KonferanslarıÜniversite Konferansları, 4 , 4 FebruaryFebruary 1937. On the other hand, Bilsay Kuruç 1937. On the other hand, Bilsay Kuruç in his article “İktisat Nasıl Okutulmalı” retroin his article “İktisat Nasıl Okutulmalı” retrospectively arguespectively arguedd that “the economists that “the economists were not entrusted a significant task or responsibility for the total development poli-were not entrusted a significant task or responsibility for the total development poli-cies as partcies as partss of state polof state poliicies, in the 40cies, in the 40--50 years past.”50 years past.” Kuruç, “İktisat Nasıl,” Kuruç, “İktisat Nasıl,” 169169..

65 It is worth to mention It is worth to mention that an independthat an independent faculty of economicsent faculty of economics in Turkeyin Turkey was was founded before France. The comparison with France was meaningful in the sense that founded before France. The comparison with France was meaningful in the sense that the previous tradition was mostly close to the French ecolé, in the line of Charles Gide. the previous tradition was mostly close to the French ecolé, in the line of Charles Gide. On the other hand, the faculty of economics On the other hand, the faculty of economics were already available in Britain and the were already available in Britain and the US, and started to be formed in Germany, Italy and Switzerland in the recent 20US, and started to be formed in Germany, Italy and Switzerland in the recent 20--30 30 yearsyears.. Fındıkoğlu, Fındıkoğlu, Türkiye’de İktisat,Türkiye’de İktisat, 6969..

Ş E B N E M G E L M E D İ

private institutions demand cadres that have comprehensive

private institutions demand cadres that have comprehensive knowledge on economics.knowledge on economics.66

Apart from

Apart from Sarc and Bilsel, FındıkoğluSarc and Bilsel, Fındıkoğlu alsoalso claimclaimeded that the foundation that the foundation of an autonomous faculty of economics is a must if Turkey wants to get of an autonomous faculty of economics is a must if Turkey wants to get rid of its auxiliary position rid of its auxiliary position visvis--àà--visvis the Western counterparts, compre-the Western counterparts, compre-hend the economic realities and generate new ideas ihend the economic realities and generate new ideas in the field of eco-n the field of eco-nomics by appropriating the idea that “the theory is just for the theory nomics by appropriating the idea that “the theory is just for the theory itself.itself.67 The faculty of economics in Fındıkoğlu’s consideration was an The faculty of economics in Fındıkoğlu’s consideration was an instrument that would enlighten the social and economic structure of instrument that would enlighten the social and economic structure of Turkey via the light of sTurkey via the light of science.cience.68 The purpose was to provide a strong The purpose was to provide a strong linkage between the ideals of the faculty and the country with an em-linkage between the ideals of the faculty and the country with an em-phasis on the significance of embracing new approaches in accordance phasis on the significance of embracing new approaches in accordance with the peculiarities and needs of the country. Another important point with the peculiarities and needs of the country. Another important point uunderlined by Fındıkoğlu is that, although the methods and opinions of nderlined by Fındıkoğlu is that, although the methods and opinions of the European academics should be taken in consideration during the the European academics should be taken in consideration during the creation process, economics in Turkey should not be regarded as an creation process, economics in Turkey should not be regarded as an imitation of French Charles Gide, German Sombartimitation of French Charles Gide, German Sombart,, oror any other foreign any other foreign academic.academic.69

During

During the foundation process of the institution, the composition of the foundation process of the institution, the composition of the academic staff was determined in accordance with this idea. Aside the academic staff was determined in accordance with this idea. Aside from establishment of new chairs, the fact was to find new professors from establishment of new chairs, the fact was to find new professors that would createthat would create a new spirita new spirit70 and that new spirit would be inspired and that new spirit would be inspired by the new cadre. There were three groups of academics, first there by the new cadre. There were three groups of academics, first there were academics from Darülfünun who were supposed to carry the qual-were academics from Darülfünun who were supposed to carry the qual-ifications of real scientists. Second, there were younger cadre educaifications of real scientists. Second, there were younger cadre educated ted

66 Çakır and Akar, “İktisat Eğitiminin,” 281, quoted in Çakır and Akar, “İktisat Eğitiminin,” 281, quoted in Cumhuriyet Cumhuriyet Newspaper, 5 February Newspaper, 5 February 1937, Cemil Bilsel, “İktisat Fakültesi Açılış Nutku1937, Cemil Bilsel, “İktisat Fakültesi Açılış Nutku,,” 4 February 1937.” 4 February 1937.

67 Fındıkoğlu, Fındıkoğlu, Türkiye’de İktisatTürkiye’de İktisat, , 6969..

68 http://iktisathttp://iktisat.istanbul.edu.tr/?page_id=6926.istanbul.edu.tr/?page_id=6926

69 Seyhun Doğan and Çiğdem Börke Tunalı, Seyhun Doğan and Çiğdem Börke Tunalı, T. C. T. C. İstanbul Üniversitesi İktisat Fakültesi İstanbul Üniversitesi İktisat Fakültesi 75. 75. Kuruluş Yıldönümü AlbümüKuruluş Yıldönümü Albümü, (İstanbul, 2011), 17, cited in Fındıkoğlu, “İktisat Fakültesi,” , (İstanbul, 2011), 17, cited in Fındıkoğlu, “İktisat Fakültesi,” Çığır Çığır 47, (1937): 1.47, (1937): 1.

70 Hirsch,Hirsch, HatıralarıHatıralarım, m, 245245..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

in Europe that gained appreciation of their masters. And the third were

in Europe that gained appreciation of their masters. And the third were the foreign professors.the foreign professors.71

As Fındıkoğlu mentioned, the impact of the foreign professors was

As Fındıkoğlu mentioned, the impact of the foreign professors was really appreciated for a country that had undergone a rapid westerniza-really appreciated for a country that had undergone a rapid westerniza-tion process in mantion process in many senses. Achieving the Western standards in educa-y senses. Achieving the Western standards in educa-tion and the competency were bothtion and the competency were both desirable for the new desirable for the new RRepublic. The epublic. The problem was to specify the criteria these professors would be problem was to specify the criteria these professors would be accord-accord-ingly ingly determined and determined and resolve resolve how they would be persuaded to work in how they would be persuaded to work in Turkey. Ernst Hirsch quoteTurkey. Ernst Hirsch quotedd Reşit Galip’s talk on determination of these Reşit Galip’s talk on determination of these foreign professors as follows: foreign professors as follows:

Ouur only criterion in the choice of these professors is their de-r only criterion in the choice of these professors is their de-gree and fame exceeding the borders of their countries. The most gree and fame exceeding the borders of their countries. The most suitable and radical ssuitable and radical solution is to keep up the number of these olution is to keep up the number of these foreign professors by any means necessary, in order to enhance foreign professors by any means necessary, in order to enhance the level of our university as soon as possible, educate new Turk-the level of our university as soon as possible, educate new Turk-ish scientists beside these qualified leaders, reorganize the la-ish scientists beside these qualified leaders, reorganize the la-boratories, seminars, boratories, seminars, by and large the whole education in a sci-by and large the whole education in a sci-entific manner, open a road to original scientific research within entific manner, open a road to original scientific research within a real university spirit.a real university spirit.72

Here we can see that most of the academics

Here we can see that most of the academics werewere focusfocuseded on the ration-on the ration-ality principle and renewed methodology in teaching ality principle and renewed methodology in teaching of economics. The of economics. The main concern main concern wawas to bring in the capability of understanding the eco-s to bring in the capability of understanding the eco-nomic realities of the country by building causal scientific relations. An-nomic realities of the country by building causal scientific relations. An-other important concern other important concern wawas to have qualified cadres for the public and s to have qualified cadres for the public and private firms which woulprivate firms which would both contribute to the economic develop-d both contribute to the economic develop-ment of the country in catching up the Western standards iment of the country in catching up the Western standards in conceptu-n conceptu-alization of “university”. However, as might be seen within this dis-alization of “university”. However, as might be seen within this dis-course of Fındıkoğlu, the choice of words like “creation” is important as course of Fındıkoğlu, the choice of words like “creation” is important as it signifies a distancing from any “imitation” or “import” of the ideas it signifies a distancing from any “imitation” or “import” of the ideas from foreign figures. Hence, we from foreign figures. Hence, we can say that a genuine experience based can say that a genuine experience based

71 Hirsch,Hirsch, Hatıralarım, Hatıralarım, 243243..

72 Ibid.Ibid., , 243243..

Ş E B N E M G E L M E D İ

on scientific principles combined with an intent to serve the purpose of

on scientific principles combined with an intent to serve the purpose of economic development was excitedly desired by the academics and ex-economic development was excitedly desired by the academics and ex-pectations from the faculty were shaped within this perspective.pectations from the faculty were shaped within this perspective.

2.2.5 The FounThe Founding Figures: German Émigré Economists and For-ding Figures: German Émigré Economists and For-mation of the Facultymation of the Faculty

The university reform took place in 1933 and numerous scholars were

The university reform took place in 1933 and numerous scholars were laid off from the university which gave rise to recruitment possibilities laid off from the university which gave rise to recruitment possibilities for the new cadre. Incidentally, the year of for the new cadre. Incidentally, the year of the university reform coin-the university reform coin-cided with the rise to power of the Nazis, during which many scholars cided with the rise to power of the Nazis, during which many scholars were dismissed. These academics were looking for employment oppor-were dismissed. These academics were looking for employment oppor-tunities outside and Atatürk was personally engaged in this process. It tunities outside and Atatürk was personally engaged in this process. It was because the importawas because the important thing for a country was considered as the nt thing for a country was considered as the competency, neither the political positions nor the ethnic origins.competency, neither the political positions nor the ethnic origins.73 The The arrival and the scientific studies of these émigré economists were de-arrival and the scientific studies of these émigré economists were de-picted as positive externalities for the higher education system as Tpicted as positive externalities for the higher education system as Tur-ur-key had the opportunity to take advantage of both scientific and artistic key had the opportunity to take advantage of both scientific and artistic ingenuities whose formation might have required many years of educa-ingenuities whose formation might have required many years of educa-tion as well as the experience and mobilization of substantial amount of tion as well as the experience and mobilization of substantial amount of national resources.national resources.74 Thanks to the nonThanks to the non--eexistence of the faculty of eco-xistence of the faculty of eco-nomics before, there were fewer dismissals in this field and it was much nomics before, there were fewer dismissals in this field and it was much easier for the refugee academics to shape their new working environ-easier for the refugee academics to shape their new working environ-ments. These émigré academics were bound to learn Turkish as soon as ments. These émigré academics were bound to learn Turkish as soon as possible and writpossible and write textbooks for their departments which would in turn e textbooks for their departments which would in turn be very influential for the ideological embodiment of the following gen-be very influential for the ideological embodiment of the following gen-

73 Özveren, Özveren, “A Hundred Years,” “A Hundred Years,” 156156..

74 Ege Ege and Hagemann, “The Modernization,” and Hagemann, “The Modernization,” 2525; Özveren evaluates this coincidence as a ; Özveren evaluates this coincidence as a historical opportunity for a rapid and qualified structuring of the faculty. Öhistorical opportunity for a rapid and qualified structuring of the faculty. Özveren, zveren, “Türkiye’de Üniversite ve İktisat“Türkiye’de Üniversite ve İktisat,,”” 404.404.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

erations of economists.

erations of economists.75 Indeed, they were not representatives of a sin-Indeed, they were not representatives of a sin-gle school of thoughtgle school of thought, but had , but had various ideological colors. Yvarious ideological colors. Yet, it et, it isis ironic ironic when we think of the fact that while the “liberal” label for the academics when we think of the fact that while the “liberal” label for the academics in Darülfünun was propounded as a reason for a change, most of the in Darülfünun was propounded as a reason for a change, most of the émigré academics in the newly founded university, especially Röpke and émigré academics in the newly founded university, especially Röpke and Rüstow were also strongly Rüstow were also strongly liberal.liberal.76

Among the émigré academics we should first mention one of the

Among the émigré academics we should first mention one of the most influential figures Wilhelm Röpke most influential figures Wilhelm Röpke (1899(1899--1966)1966). . He was aHe was a profes-profes-sor of political science at Marburg University, till he was fired in 1933 sor of political science at Marburg University, till he was fired in 1933 because of his antibecause of his anti--Nazi stance.Nazi stance.77 Being oneBeing one of the first distinguished of the first distinguished professors in Germany, Röpke, without any doubt, was the most famous professors in Germany, Röpke, without any doubt, was the most famous of the émigré economists. Although stayed in Turkey for only 4 years of the émigré economists. Although stayed in Turkey for only 4 years and left to Geneva in 1937 due to feeling culturally alienated and left to Geneva in 1937 due to feeling culturally alienated ––he was he was unable to learn Turunable to learn Turkishkish –– RöpkeRöpke was a very productive academic during was a very productive academic during his stay. As he was the most famous one, the job of preparing the teach-his stay. As he was the most famous one, the job of preparing the teach-ing plan was under his responsibility as the first chair of the institute ing plan was under his responsibility as the first chair of the institute ((İktisat ve İçtimaiyyatİktisat ve İçtimaiyyat EnstitüsüEnstitüsü))..78 He is still retrospectiHe is still retrospectively recognized vely recognized among the founders of the among the founders of the ““social market economysocial market economy”” doctrine.doctrine.79 He was He was

75 Neumark, Neumark, Boğaziçine Sığınanlar,Boğaziçine Sığınanlar, 2121.. Çiğdem Boz also mentions that there was a Çiğdem Boz also mentions that there was a protocol foreclosing the émigré economists to do politics here.protocol foreclosing the émigré economists to do politics here. Ercan Eren, “İstan-Ercan Eren, “İstan-bul’da İktisat Belgeseli ve Türkiye’de İktibul’da İktisat Belgeseli ve Türkiye’de İktisadi Düşünce sadi Düşünce –– Çiğdem Boz Söyleşisi”, Janu-Çiğdem Boz Söyleşisi”, Janu-ary 14, 2022, video, ary 14, 2022, video, https://www.youtube.com/watch?v=lBsn3DKopxkhttps://www.youtube.com/watch?v=lBsn3DKopxk

76 Röpke’s liberal views were so strong that although he was neither dismissed for any Röpke’s liberal views were so strong that although he was neither dismissed for any racial reason nor a leftist activist, he conflicted withracial reason nor a leftist activist, he conflicted with thethe Nazis due to his belief in liber-Nazis due to his belief in liber-alism. Ege alism. Ege and Hagemann,and Hagemann, “The Modernisation,” “The Modernisation,” 2020..

77 Neumark,Neumark, Boğaziçine SığınanlarBoğaziçine Sığınanlar, , 7474.. Neumark mentions that there was a huge Neumark mentions that there was a huge resemblance between the Nazi’s imagined ideal type ‘Siegfried’ and Röpkeresemblance between the Nazi’s imagined ideal type ‘Siegfried’ and Röpke,, that some that some people coupeople could not understand how a man like Röpke didn’t show obedience to the re-ld not understand how a man like Röpke didn’t show obedience to the re-gime. Yet, Neumark emphasizes a point overlooked: Röpke’s decisiveness on making gime. Yet, Neumark emphasizes a point overlooked: Röpke’s decisiveness on making no concessions either to Hitler or to any of his tenets. He was one of those classical no concessions either to Hitler or to any of his tenets. He was one of those classical liberals who wliberals who wasas ssure on that the ghost of the third Reich will disappear at last and he ure on that the ghost of the third Reich will disappear at last and he will again participate in critical missions inwill again participate in critical missions in--for Germany.for Germany. Ibid., 74.Ibid., 74.

78 Ibid.Ibid.,, 7575..

79 Neumark mentions some of the works of Röpke and claims that all these works were Neumark mentions some of the works of Röpke and claims that all these works were widely read eswidely read especially in the aftermath of the Nazi regime. pecially in the aftermath of the Nazi regime. Neumark, Neumark, BoğaziçineBoğaziçine

Ş E B N E M G E L M E D İ

involved in Austrian school of thought in general sense

involved in Austrian school of thought in general sense –– especially especially for for his views onhis views on the methodology debatethe methodology debate –– but itbut it was also was also argued that he argued that he tended towards to the “third wtended towards to the “third way” after the years he stayed in Turkey.ay” after the years he stayed in Turkey.80 An equally important thing about Röpke is that he was also among the An equally important thing about Röpke is that he was also among the founders of the founders of the Mont PMont Pèèlerin Societylerin Society in 1947 and was the chair of the in 1947 and was the chair of the society after Hayek’s presidency.society after Hayek’s presidency.81

If the most foremost name is Wilhelm Röpf the most foremost name is Wilhelm Röpke, the second one is Fritz ke, the second one is Fritz Neumark without any doubt. Indeed, the greatest and the longestNeumark without any doubt. Indeed, the greatest and the longest--lasting impact among émigré economists can be considered as Neu-lasting impact among émigré economists can be considered as Neu-mark’s.mark’s.82 Before his dismissal in 1933 due to the Nazi antiBefore his dismissal in 1933 due to the Nazi anti--Semitism, Semitism, Neumark (1900Neumark (1900--1991)1991), he, he was a prwas a professor at Frankfurt, wellofessor at Frankfurt, well--equipped equipped with knowledge of economics and finance. When he came to Turkey, he with knowledge of economics and finance. When he came to Turkey, he was inducted to the second chairwas inducted to the second chair in economicsin economics. . It was It was also also Neumark Neumark who prepared the report for the foundation of the faculty of econom-who prepared the report for the foundation of the faculty of econom-ics.ics.83 He succeededHe succeeded at learning Turkish and Ottoman Turkish. Together at learning Turkish and Ottoman Turkish. Together with İbrahim Fazıl Pelin, he gave lectures on fiscal economics. An equal-with İbrahim Fazıl Pelin, he gave lectures on fiscal economics. An equal-ly significant contribution of him can be regarded as his devotion to ly significant contribution of him can be regarded as his devotion to publish a journal on economics in which he became the lead writpublish a journal on economics in which he became the lead writer and er and directorate.directorate.84 He stayed in Turkey until 1950 and as the head of the new He stayed in Turkey until 1950 and as the head of the new

Sığınanlar,

Sığınanlar, 9898.. Indeed, hIndeed, his legacy was still appreciated that there was a conference held is legacy was still appreciated that there was a conference held in memoriam of Röpke in Ludwig von Mises Institute a few years ago. Ludwig von in memoriam of Röpke in Ludwig von Mises Institute a few years ago. Ludwig von Mises is a symbolic nMises is a symbolic name of Austrian school of economic thought who has written on ame of Austrian school of economic thought who has written on behalf of the classical liberal creed. behalf of the classical liberal creed.

80 ErcanErcan Eren, Eren, “Avusturya İktisadından Üçüncü Yola“Avusturya İktisadından Üçüncü Yola,,” in ” in Türkiye’de İktisadi DüşünceTürkiye’de İktisadi Düşünce, 268, 268..

81 Ibid.Ibid.,, 262262..

82 EgeEge and Hagemann, “The Modernisation,” and Hagemann, “The Modernisation,” 2020..

83 Doğan and Tunalı, Doğan and Tunalı, T. C. T. C. İstanbul Üniversitesi İktisat Fakültesiİstanbul Üniversitesi İktisat Fakültesi 75.75. Kuruluş Yıldönümü Kuruluş Yıldönümü AlbümüAlbümü, , 15;15; Ege Ege and Hagemann,and Hagemann, “The Modernisation,” “The Modernisation,” 1919..

84 Neumark, Neumark, Boğaziçine Sığınanlar, Boğaziçine Sığınanlar, 235235.. The journal is also significant in the sense that it The journal is also significant in the sense that it is sent to Europis sent to Europe and The United States and exchanged by foreign journals. Moreover, e and The United States and exchanged by foreign journals. Moreover, many articles by foreign scientists and institutions were also published in the journal. many articles by foreign scientists and institutions were also published in the journal. Fındıkoğlu argues that aFındıkoğlu argues that almost the sixty lmost the sixty percentpercent is devoted to the Turkish articles; the is devoted to the Turkish articles; the rest was crest was composed of the translations of German, French and English texts. While the omposed of the translations of German, French and English texts. While the first part of the volumes is dedicated to the theoretical and historical issues and world first part of the volumes is dedicated to the theoretical and historical issues and world economy; the seeconomy; the se..cond part is focused to the matters of national economy. In the third cond part is focused to the matters of national economy. In the third

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

Fiscal Institute in 1946, he played an advisory role in making of new

Fiscal Institute in 1946, he played an advisory role in making of new legislation about the taxes.legislation about the taxes.85

The oldest of the émigré professors was Gerhard Kessler (1883

The oldest of the émigré professors was Gerhard Kessler (1883--1963). As being1963). As being involved in antiinvolved in anti--Nazi politics, he was forced to leave his Nazi politics, he was forced to leave his position as a professor of sociology at Leipzig University in 1933position as a professor of sociology at Leipzig University in 1933..86 Similar with Neumark, he also stayed in Turkey for a relatively long Similar with Neumark, he also stayed in Turkey for a relatively long time, until 1951time, until 1951,, and during his stay he contributed to thand during his stay he contributed to the enhancement e enhancement of the library of economic and social sciences with a dedication on col-of the library of economic and social sciences with a dedication on col-lecting and organizing numerous books.lecting and organizing numerous books.87 He gave sociology lectures in He gave sociology lectures in the faculty of lawthe faculty of law, , before the foundation of faculty of economicsbefore the foundation of faculty of economics,, and he and he was the founding figure of was the founding figure of the İktisadiyat ve İçtimaiyat Enstitüsüthe İktisadiyat ve İçtimaiyat Enstitüsü. The . The social policy and sociology veins in economics education owe much to social policy and sociology veins in economics education owe much to the contributions of Kesslerthe contributions of Kessler who was regarded as a forerunner by his who was regarded as a forerunner by his assistants and studentsassistants and students.. His efforts to “know the country” and solve the His efforts to “know the country” and solve the “social problems” was appreciated by many authors. Kessler was remu-“social problems” was appreciated by many authors. Kessler was remu-nerated as a role model who utilized sociology as a mean to serve for nerated as a role model who utilized sociology as a mean to serve for

part,

part, there is bibliography in which there are examinations and critics on recently there is bibliography in which there are examinations and critics on recently published material. Fındıkoğlu, published material. Fındıkoğlu, Türkiye’de İktisat,Türkiye’de İktisat, 115115.. IIn brief, the explicit aim of the n brief, the explicit aim of the journal as it was suggested by Ege et al. was “opening up to, and catching up with, thjournal as it was suggested by Ege et al. was “opening up to, and catching up with, the e existing level of international research” existing level of international research” Ege and Hagemann, “The Modernisation,”Ege and Hagemann, “The Modernisation,” 2121..

85 Özveren, Özveren, “A Hundred Years,” “A Hundred Years,” 156156.. Another figure who played a role in making of a Another figure who played a role in making of a legislation was Ernst Hirsch, who contributed to making of the commercial code.legislation was Ernst Hirsch, who contributed to making of the commercial code. It iIt is s remarkable that remarkable that both Neumark and Hirsch becboth Neumark and Hirsch becaame Turkish citizens.me Turkish citizens.

86 Özveren,Özveren, , , “A Hundred Years,” “A Hundred Years,” 156156..

87 Ibid., Ibid., 156156. . Previously, the library was mainly composed of approximately 1000 books Previously, the library was mainly composed of approximately 1000 books of Johannes Conrad and Adolf Wagner, bought by the Ottoman Empof Johannes Conrad and Adolf Wagner, bought by the Ottoman Empire for İstanbul ire for İstanbul DarülfünunDarülfünunuu. In 1934, the library was enriched by the modern books written in Ger-. In 1934, the library was enriched by the modern books written in Ger-man, English and French. In the aftermath of the launching, books, newspapers, man, English and French. In the aftermath of the launching, books, newspapers, jour-jour-nals, statistical data, banking and budget reports were purveyed. Fındıkoğlnals, statistical data, banking and budget reports were purveyed. Fındıkoğlu also em-u also em-phasized that new rooms were allocated and the number of the books were doubled. phasized that new rooms were allocated and the number of the books were doubled. All the books and journals were rebinded and imprinted by Kessler’s efforts. In the All the books and journals were rebinded and imprinted by Kessler’s efforts. In the year 1946, Fındıkoğlu claims that there year 1946, Fındıkoğlu claims that there wewere approximately 8000 volumes of sourcesre approximately 8000 volumes of sources most of which was devoted to the issues related to Turkey. Fındıkoğlu, most of which was devoted to the issues related to Turkey. Fındıkoğlu, Türkiye’de İkti-Türkiye’de İkti-sat,sat, 119.119.

Ş E B N E M G E L M E D İ

the country.

the country.88 He was He was also also known as a hardworking known as a hardworking and and kindkind--hearted hearted professor who paid attention to his students both sciprofessor who paid attention to his students both scientifically and hu-entifically and hu-manisticallymanistically..89

These three names, Röpke, Neumark and Kessler, were representa-

These three names, Röpke, Neumark and Kessler, were representa-tive figures of the new faculty and their fields of studies in the faculty tive figures of the new faculty and their fields of studies in the faculty that are general economics, public finance and social politics will be that are general economics, public finance and social politics will be elaborated in elaborated in the following three chapters respectively. However, there the following three chapters respectively. However, there were some other influential professors namely Alexander Rüstow, Josef were some other influential professors namely Alexander Rüstow, Josef Dobretsberger, Alfred Isaac and Umberto Ricci. Dobretsberger, Alfred Isaac and Umberto Ricci.

Previously a sociologist at Berlin Hochschule,

Previously a sociologist at Berlin Hochschule, Rüstow also had to Rüstow also had to leave Germany leave Germany in 1933 since Gestapo was after him. When he came to in 1933 since Gestapo was after him. When he came to Istanbul University, he served as a lecturer Istanbul University, he served as a lecturer in in economic history and economic history and economic geography courses. Unlike Neumark, he could not master economic geography courses. Unlike Neumark, he could not master Turkish andTurkish and similar with Röpke,similar with Röpke, he felt culturally alienated until 194he felt culturally alienated until 1949.9.90 Even so, he Even so, he wrotewrote textbooks in accordance with the responsibilities of textbooks in accordance with the responsibilities of the contract. the contract. Some of tSome of the articles related to cultural and sociological he articles related to cultural and sociological issues he wrote were translated into Turkish. As Fındıkoğlu asserts, issues he wrote were translated into Turkish. As Fındıkoğlu asserts, while constructing his economic philosopwhile constructing his economic philosophy and sociological interpreta-hy and sociological interpreta-tions, he considered Turkey as an observation tower to see what itions, he considered Turkey as an observation tower to see what iss hap-hap-pening in the world.pening in the world.91

Neumark in his memoirs on

Neumark in his memoirs on IIstanbul yearsstanbul years,, mentions Rüstow as a mentions Rüstow as a heartedly and mentally liberal in political tendencies and economic poheartedly and mentally liberal in political tendencies and economic pol-l-

88 Cavit Orhan Cavit Orhan Tütengil, “Ord, Prof. Dr. G. Kessler’in Sosyoloji Tarihimizdeki Yeri ve Tütengil, “Ord, Prof. Dr. G. Kessler’in Sosyoloji Tarihimizdeki Yeri ve Türkiye’deki Yayınlarının BibliyografyasıTürkiye’deki Yayınlarının Bibliyografyası,,” ” İÜİFM İÜİFM 23, no.23, no. 33--4 (1963):4 (1963): 5544..

89 Neumark, Neumark, Boğaziçine,Boğaziçine, 78. Kessler78. Kessler was a distinctively influential figure for Neumark. was a distinctively influential figure for Neumark. They have already met before they arrived at Turkey. Kessler had given an oral exami-They have already met before they arrived at Turkey. Kessler had given an oral exami-nation to Neumark at Leipzig, where Neumark defended a thesis on inflation. Neu-nation to Neumark at Leipzig, where Neumark defended a thesis on inflation. Neu-mmark states that Kessler was very interested in his students not only for scientific is-ark states that Kessler was very interested in his students not only for scientific is-sues but also had a strong faith in humanitarian values. His primary domain of interest sues but also had a strong faith in humanitarian values. His primary domain of interest was social politics. Neumark that his choice of the discipline of economics can bewas social politics. Neumark that his choice of the discipline of economics can be de-de-rived from the influence of Kessler on him.rived from the influence of Kessler on him. Ibid., 78.Ibid., 78.

90 Özveren, Özveren, “A Hundred Years,”“A Hundred Years,”156156..

91 Ziyaeddin Ziyaeddin Fındıkoğlu, “Türk Sosyolojisinde İki Alman Sosyologu: Prof. Kessler ve Prof. Fındıkoğlu, “Türk Sosyolojisinde İki Alman Sosyologu: Prof. Kessler ve Prof. RüstowRüstow,,”” İÜİFMİÜİFM 23, no. 323, no. 3--4 (1963):4 (1963): 4949..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

icies.

icies.92 The starting point of Rüstow was mentioned as provision of a The starting point of Rüstow was mentioned as provision of a sociosocio--economic order that is constructed by the values of freedom and economic order that is constructed by the values of freedom and free will. Within this context, it was argued that the interpersonal rela-free will. Within this context, it was argued that the interpersonal rela-tions for him hations for him hadd the highest priority overthe highest priority over the relations between hu-the relations between hu-mans and materials. The latter mans and materials. The latter wawas considered as an auxiliary instru-s considered as an auxiliary instru-ment for the former.ment for the former.93 Rüstow was portrayed as a figure whoRüstow was portrayed as a figure who alsoalso wanted to systemize an approach that embraces social policy, namely wanted to systemize an approach that embraces social policy, namely vitalpolitikvitalpolitik, that gives preced, that gives precedence to human values over economic life.ence to human values over economic life.94 In this line, hIn this line, he wase was also depictedalso depicted a classical as of education but a social-a classical as of education but a social-ist as of his beliefsist as of his beliefs by some authorsby some authors..95 The The emergence of theemergence of the idea of theidea of the “third way”“third way” owed much to the owed much to the relations between Röpke and Rüstowrelations between Röpke and Rüstow, , wwho ho were in reshaping each other’s viewpointswere in reshaping each other’s viewpoints..96

The chair of

The chair of ““GeGeneral neral TTheory of heory of EEconomics and conomics and FFinanceinance”” was suc-was suc-ceeded by Josef Dobretsberger after Röpke’s renouncement.ceeded by Josef Dobretsberger after Röpke’s renouncement.97 Ironically, Ironically, the views of the two figures were poles apart. Röpke was a devoted lib-the views of the two figures were poles apart. Röpke was a devoted lib-eral weral while Dobretsberger was a strong leftist who was interested in poli-hile Dobretsberger was a strong leftist who was interested in poli-tics, predominantly with its social aspects. He was also keen on analyz-tics, predominantly with its social aspects. He was also keen on analyz-ing the results of the current policies implemented by the industrial ing the results of the current policies implemented by the industrial countries based on the political phenomenon and scountries based on the political phenomenon and statistical data.tatistical data.98 It is It is not surprising that the name of his book on economics is not surprising that the name of his book on economics is Ekonomi Ekonomi Siyaseti. Siyaseti. Being a former Austrian cabinet minister, he was also a profes-Being a former Austrian cabinet minister, he was also a profes-sor at Graz University. He was urged to leave Turkey by the appointment sor at Graz University. He was urged to leave Turkey by the appointment of Franz von Papen as tof Franz von Papen as the Nazi ambassador to Ankara.he Nazi ambassador to Ankara.99 According to According to

92 Neumark, Neumark, Boğaziçine Sığınanlar,Boğaziçine Sığınanlar, 27.27.

93 Sabri Ülgener, Sabri Ülgener, “Alexander Rüstow: Bir Fikir ve Aksiyon İnsanının Ardından,” “Alexander Rüstow: Bir Fikir ve Aksiyon İnsanının Ardından,” İÜİFM İÜİFM 23, 23, no. 3no. 3--4 (4 (11963963): ): 2626--2727..

94 Ibid.,Ibid., 2727..

95 Ercan Eren,Ercan Eren, “Avusturya İktisadından“Avusturya İktisadından,,” 269” 269, cited in Reisman (2011:135)., cited in Reisman (2011:135).

96 Ibid., 269.Ibid., 269.

97 Özveren,Özveren, “A Hundred Years,” “A Hundred Years,” 157157.. Çiğdem Çiğdem Boz mentions that Dobretsberger came to Boz mentions that Dobretsberger came to Turkey with the reference of Ludwig von Mises.Turkey with the reference of Ludwig von Mises. Ercan Eren, “İstanbul’da İktisat Bel-Ercan Eren, “İstanbul’da İktisat Bel-geseli”. geseli”. https://www.youtube.com/watch?v=lBsn3DKopxkhttps://www.youtube.com/watch?v=lBsn3DKopxk

98 http://iktisat.istanbul.edu.tr/?p=6520http://iktisat.istanbul.edu.tr/?p=6520

99 Özveren,Özveren, “A Hundred Years,”“A Hundred Years,”157157..

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Neumark, his inclinations

Neumark, his inclinations detaindetained him to make scientific academic ed him to make scientific academic work although he was very work although he was very skillfulskillful..100 On the other hand, his existence On the other hand, his existence in the faculty put a new face on economics education throughout three in the faculty put a new face on economics education throughout three yearsyears he stayed in Turkeyhe stayed in Turkey..

In the aftermath of Dobretsberger’s relinquishing, a new cadre in

In the aftermath of Dobretsberger’s relinquishing, a new cadre in economics became available. And this time, Mussolini economics became available. And this time, Mussolini ––as a matter of as a matter of course unintentionallycourse unintentionally –– helped in finding an influential academic called helped in finding an influential academic called Umberto Ricci, who was a Umberto Ricci, who was a professor in economic theory in University of professor in economic theory in University of Rome. Ricci was a representative of classical liberal doctrine that was Rome. Ricci was a representative of classical liberal doctrine that was completely opposed to the corporative state mindset which led him lose completely opposed to the corporative state mindset which led him lose his professorship.his professorship.101 Unlike Kessler, he was first and foremost a theUnlike Kessler, he was first and foremost a theore-ore-tician who published a work on value theory in Turkey which was later tician who published a work on value theory in Turkey which was later translated into French.translated into French.102

Lastly, we should mention Alfred Isaac

Lastly, we should mention Alfred Isaac, , who was a professor of man-who was a professor of man-agement fired from Nurnberg due to similar antiagement fired from Nurnberg due to similar anti--Semitic policies. He Semitic policies. He arrived in Turkey in 19arrived in Turkey in 1937 and 37 and ultimatelultimately he was able to acquire enough y he was able to acquire enough Turkish. He played the leading role in Turkish. He played the leading role in establishingestablishing the management the management program.program.103 Apparently,Apparently, the German factionthe German faction generated the more generated the more signifi-signifi-cantcant part of the faculty members in economics.part of the faculty members in economics.104

Despite some certain bound

Despite some certain boundaries, all these academics aspired to un-aries, all these academics aspired to un-derstand the peculiarities of Turkey in constructing a framework of derstand the peculiarities of Turkey in constructing a framework of economics education here. They arrived at Turkey in the age of statism, economics education here. They arrived at Turkey in the age of statism, few years after the Great Depression few years after the Great Depression during during when liberalism was disfa-when liberalism was disfa-vored. vored. Yet, in Özveren’s words “They were all, more or less, liberals, if Yet, in Özveren’s words “They were all, more or less, liberals, if one interprets liberalism loosely so as to imply more a political demo-one interprets liberalism loosely so as to imply more a political demo-cratic that a diecratic that a die--hard economic stand”.hard economic stand”.105 Referring to Neumark, he Referring to Neumark, he states that most of these states that most of these émigréémigré academicsacademics, , among whiamong which we can count ch we can count

100 Neumark, Neumark, Boğaziçine Sığınanlar, Boğaziçine Sığınanlar, 8787..

101 Ibid.Ibid., 87, 87..

102 IbidIbid., ., 8888..

103 Özveren, 157Özveren, 157;; NeumNeumark,ark, 8282..

104 Özveren, 157Özveren, 157..

105 Ibid., 158.Ibid., 158.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

Röpke and Rüstow but not Kessler

Röpke and Rüstow but not Kessler,, were “deeply liberal in ‘heart and were “deeply liberal in ‘heart and mind’.mind’.”” 106 According to Özveren, According to Özveren, eveneven Neumark belongs to this ideologi-Neumark belongs to this ideologi-cal cal stancestance although he welcomed and made a revision on his position in although he welcomed and made a revision on his position in the aftermath of the Keynesian the aftermath of the Keynesian theoretical improvisations unlike Röp-theoretical improvisations unlike Röp-ke.ke.107 Röpke did never change his stance as a devoted liberal right to the Röpke did never change his stance as a devoted liberal right to the end, probably because Keynesian fiscal policy was evoking state social-end, probably because Keynesian fiscal policy was evoking state social-ism to him.ism to him.108

Kessler on the other hand, was much more complaisant towards

Kessler on the other hand, was much more complaisant towards ststate interventionism and social policy. He was a centrist who carried ate interventionism and social policy. He was a centrist who carried the influence of the influence of the the German Historical School, educated under Wilhelm German Historical School, educated under Wilhelm Stieda and Karl Bücher. According to Neumark, Kessler was the Prussian Stieda and Karl Bücher. According to Neumark, Kessler was the Prussian version of Austrian Dobretsbergerversion of Austrian Dobretsberger109, who can be, who can be characterized as a characterized as a Catholic, strong leftist in political and social tendenciesCatholic, strong leftist in political and social tendencies, , influenced by influenced by Hans Kelsen, Hans Kelsen, in addition to the symbolic figures of the in addition to the symbolic figures of the old old Austrian Austrian School that areSchool that are represented byrepresented by Carl Menger and Eugene Böhm Baw-Carl Menger and Eugene Böhm Baw-erk.erk.110 In the In the wordswords of Orhan Tuof Orhan Tuna, Kessler na, Kessler was an ethicist sociologist was an ethicist sociologist instead of instead of being being a doctrinaire scientista doctrinaire scientist. He . He belonged to social liberal belonged to social liberal flow in the westflow in the west, never esteeming deterministic viewpoints, never esteeming deterministic viewpoints..111

106 Özveren, “A Hundred Years,” 157. Özveren, “A Hundred Years,” 157. On the contrary, Neumark considers Kessler among On the contrary, Neumark considers Kessler among the liberal the liberal ones as wellones as well. Neumark, . Neumark, Boğaziçine Sığınanlar, Boğaziçine Sığınanlar, 2727..

107 Ibid., 157.Ibid., 157.

108 Ibid., Ibid., 157157. . Neumark also mentions that the viewpoiNeumark also mentions that the viewpoints of Röpke and him were nts of Röpke and him were divergent both on theory and policy side; due to Röpke’s insistence on neoclassical divergent both on theory and policy side; due to Röpke’s insistence on neoclassical ideas and extreme liberalism even after the publication of Keynes’ ideas and extreme liberalism even after the publication of Keynes’ General TheoryGeneral Theory in in 1936. Neumark, 1936. Neumark, Boğaziçine SığınanBoğaziçine Sığınanlar,lar, 7676..

109 Neumark, Neumark, BoğaBoğaziçine, ziçine, 79.79.

110 Özveren, “A Hundred YearsÖzveren, “A Hundred Years,,” 158. It is also remarkable that the recommendation ” 158. It is also remarkable that the recommendation letters for Kessler were written by Kelsen and Ludwig von Mises.letters for Kessler were written by Kelsen and Ludwig von Mises. The Austrian School The Austrian School of economics methodologically focuses on individual’s behaviors and actions. of economics methodologically focuses on individual’s behaviors and actions. Their Their adherence to subjective value theory and marginalism constitutes the basic feature of adherence to subjective value theory and marginalism constitutes the basic feature of the school. The Austrian School opposed to the German Historical School in the meth-the school. The Austrian School opposed to the German Historical School in the meth-odology debate that took place in the late 19odology debate that took place in the late 19thth century.century.

111 Orhan Tuna, “Kessler Orhan Tuna, “Kessler Hoca’nın Ölümü,” Hoca’nın Ölümü,” İktisat Fakültesi Sosyal Siyaset Konferanslarıİktisat Fakültesi Sosyal Siyaset Konferansları, , Kitap Kitap ((İstanbul: İktisat Fakültesi Yayınlarıİstanbul: İktisat Fakültesi Yayınları)) ::114.4.

Ş E B N E M G E L M E D İ

At this point, it

At this point, it is important to keep in mind that the concept of “be-is important to keep in mind that the concept of “be-ing liberal” ing liberal” doesn’t necessarily mean to belong to a similar school of doesn’t necessarily mean to belong to a similar school of thought or arrive at a consensus in interpreting each aspect of econom-thought or arrive at a consensus in interpreting each aspect of econom-ics. What is more, the method seized upon doesn’t definitely reflect the ics. What is more, the method seized upon doesn’t definitely reflect the ideological position. A member of the Austrian school mideological position. A member of the Austrian school may be a socialist, ay be a socialist, or a member of or a member of the the German Historical School may not always prioritize German Historical School may not always prioritize reality versus theory. Both Ludwig von Mises and Fritz Neumark were reality versus theory. Both Ludwig von Mises and Fritz Neumark were liberals in general terms, but their views were very much divergent.liberals in general terms, but their views were very much divergent.112 From this point of view, we cFrom this point of view, we can say that the word “liberal” should be an say that the word “liberal” should be deliberately evaluated considering the different perceptions in the deliberately evaluated considering the different perceptions in the 1930s’ world. One should keep in mind that the boundaries of being a 1930s’ world. One should keep in mind that the boundaries of being a “liberal” in Turkey at those times was framed by the peculiar conditions “liberal” in Turkey at those times was framed by the peculiar conditions of thof the country which have not yet raised a strong autonomous bour-e country which have not yet raised a strong autonomous bour-geoisie, which was considered as a precondition for a safe articulation geoisie, which was considered as a precondition for a safe articulation to the capitalist system. Coto the capitalist system. Consequently, as Fındıkoğlu also emphasizensequently, as Fındıkoğlu also emphasizedd, , we can say that the émigré academics were more than just economists, we can say that the émigré academics were more than just economists, they had relations with the economic culture as wellthey had relations with the economic culture as well whichwhich was ex-was ex-pected to pected to ““serveserve forfor thethe convergenceconvergence ofof thethe positivepositive sciencessciences andand philos-philos-ophyophy ofof economicseconomics toto thethe fieldfield ofof economiceconomic realismrealism andand relativism;relativism; andand aa divergencedivergence fromfrom thethe discrediteddiscredited homohomo economicuseconomicus assumptionassumption inin thethe eyeseyes ofof thethe modernmodern economiceconomic sciencescience andand economiceconomic sociology.sociology.””113

112 There is an interesting anecdote that can give clues about this situation. One day, There is an interesting anecdote that can give clues about this situation. One day, Richard von MisesRichard von Mises who was one of those émigré professwho was one of those émigré professors, askors, askss Neumark about his Neumark about his brother’s (Austrian economist Ludwig von Mises) reputation in economics. Neumark brother’s (Austrian economist Ludwig von Mises) reputation in economics. Neumark in his answer appreciatein his answer appreciatess the importance of his contributions to the monetary theory the importance of his contributions to the monetary theory and identifying him as one of the last advocates of classical and identifying him as one of the last advocates of classical liberal line, but expresses liberal line, but expresses that his opinion sharply differs from Mises’ extreme views. that his opinion sharply differs from Mises’ extreme views. See, See, Özveren, Özveren, “A Hundred “A Hundred Years,”Years,” 158158..

113 Fındıkoğlu, Fındıkoğlu, Türkiye’de İktisat,Türkiye’de İktisat, 125. Ercan Eren also emphasizes that Röpke preferred to 125. Ercan Eren also emphasizes that Röpke preferred to the concept of homoagent instead of homoeconomicus, who might systematically the concept of homoagent instead of homoeconomicus, who might systematically make mistakesmake mistakes.. Eren, Eren, “Avusturya İktisadından“Avusturya İktisadından,,” ” 294294..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

2.2.6 Distribution of DutiesDistribution of Duties

In respect of the quantitative confi

In respect of the quantitative configuration of the new faculty we can guration of the new faculty we can say that there were four degrees of academic cadre: distinguished pro-say that there were four degrees of academic cadre: distinguished pro-fessorship, professorship, associate professorship and assistantship. fessorship, professorship, associate professorship and assistantship. Those who were not academics were employed as lecturers. There were Those who were not academics were employed as lecturers. There were 8 professors i8 professors in ordinary 3 Turkish, namely Şükrü Baban, İbrahim Fazıl n ordinary 3 Turkish, namely Şükrü Baban, İbrahim Fazıl Pelin, Ömer Celal SarPelin, Ömer Celal Sarcc, and 5 German that are Alfred Isaac, Gerhard , and 5 German that are Alfred Isaac, Gerhard Kessler, Fritz Neumark, Wilhelm Röpke, Alexander Rüstow. As for the Kessler, Fritz Neumark, Wilhelm Röpke, Alexander Rüstow. As for the associates in the faculty we should mention Ömer Lütfi Barkan, Zassociates in the faculty we should mention Ömer Lütfi Barkan, Ziyaeiyaed-d-ddin Fahri Fındıkoğlu and Refii Şükrü Suvla. There was no professor dur-in Fahri Fındıkoğlu and Refii Şükrü Suvla. There was no professor dur-ing ing tthe first years.he first years.114

Interestingly, the German educated figures like Muhlis Ete and Ömer

Interestingly, the German educated figures like Muhlis Ete and Ömer Celal Sarc were planned to work as assistants of the German profes-Celal Sarc were planned to work as assistants of the German profes-sors.sors.115 AsAs forfor thethe TurkishTurkish ProfessorsProfessors underunder FrenchFrench influence,influence, wewe shouldshould mentionmention the associates Ömer Lütfi Barkan, Ziyaüddin Fahri Fındıkoğlu, the associates Ömer Lütfi Barkan, Ziyaüddin Fahri Fındıkoğlu, Refii Şükrü Suvla, Ahmet Ali Özeken and İbrahim Fazıl Pelin who were Refii Şükrü Suvla, Ahmet Ali Özeken and İbrahim Fazıl Pelin who were all educated upon French culture.all educated upon French culture.

Ömer Lütfi Barkan

Ömer Lütfi Barkan was a milestone acawas a milestone academic whose delicate and demic whose delicate and original works have gone beyond the limits of the countryoriginal works have gone beyond the limits of the country,, who had a who had a comprehensive knowledge on Ottoman history with its political and comprehensive knowledge on Ottoman history with its political and

114 http://iktisat.istanbul.edu.tr/?p=65http://iktisat.istanbul.edu.tr/?p=652020

115 They had their They had their PPhhDDs in Germanys in Germany.. Ete was an associate and Sarc was extra ordinarius, Ete was an associate and Sarc was extra ordinarius, Neumark, Neumark, Boğaziçine Sığınanlar, Boğaziçine Sığınanlar, 124. We can see the anecdotes about the relationship 124. We can see the anecdotes about the relationship between Turkish and German professors in Neumark’s memoirs. He says that it was between Turkish and German professors in Neumark’s memoirs. He says that it was nnot that warm in the very beginning. They were just asking after each other and offer-ot that warm in the very beginning. They were just asking after each other and offer-ing tea or coffee when they come upon. For instance, ing tea or coffee when they come upon. For instance, he says that he says that Şükrü Baban who Şükrü Baban who came out against the university reformcame out against the university reform,, didn’t think much of the German professors didn’t think much of the German professors since hsince he studied in French’s Sweden, adopting their language, customs and manner. e studied in French’s Sweden, adopting their language, customs and manner. Hirsch also mentions about the heterogeneity among the faculty. Each professor thinks Hirsch also mentions about the heterogeneity among the faculty. Each professor thinks that he is the bethat he is the be--all and endall and end--all. This felt uniqueness prevented them to construct all. This felt uniqueness prevented them to construct strong friestrong friendship and collegiality relations, andship and collegiality relations, as well as s well as intimate social relations. Hence, intimate social relations. Hence, their relation with public has always been superficial; they were ethnically and reli-their relation with public has always been superficial; they were ethnically and reli-giously different, rejecting adaptation to the publicgiously different, rejecting adaptation to the public. . Hirsch, Hirsch, HatıralarımHatıralarım, , 246246--247247..

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economic aspects due to the massive documentary work he was en-

economic aspects due to the massive documentary work he was en-gaged intogaged into. He was. He was entrusted with entrusted with economic history courses first.economic history courses first.116 Ibrahim Fazıl Pelin was a respected public finance professorIbrahim Fazıl Pelin was a respected public finance professor studied in studied in FranceFrance and mostand mostlyly familiar with French sourcesfamiliar with French sources, , hehe wrotewrote a public fi-a public fi-nance book made of great effort. The sociology percept in the faculty nance book made of great effort. The sociology percept in the faculty was represented by Fındıkoğlu who was was represented by Fındıkoğlu who was generalgenerallyly following Durkheim’s following Durkheim’s footsteps except some nuances. Therefore, Rüstow’s and Kessler’s lec-footsteps except some nuances. Therefore, Rüstow’s and Kessler’s lec-tures were welcomed because they were thought as subsidiartures were welcomed because they were thought as subsidiariesies. Later, . Later, we will confront with Sabri Ülgenerwe will confront with Sabri Ülgener117 at the junction point of econom-at the junction point of econom-ics and sociology, ics and sociology, the the GerGerman Historical School and Keynesianism; who man Historical School and Keynesianism; who was both familiar with Sombart’s and Weber’s works as well.was both familiar with Sombart’s and Weber’s works as well.118

The faculty dean Ömer Celal Sarc, a perfect statistician who was ed-

The faculty dean Ömer Celal Sarc, a perfect statistician who was ed-ucated in Germany beside Sombart, provided the consensus on the dis-ucated in Germany beside Sombart, provided the consensus on the dis-tribution of courtribution of courses among the Turkish and German professors.ses among the Turkish and German professors.119 Neumark mentions that tNeumark mentions that the task sharing was dissolved in a friendly he task sharing was dissolved in a friendly manner. Interestingly, only Röpke was employed in economics chair. manner. Interestingly, only Röpke was employed in economics chair. Rüstow, who was in fact a philologist before transcending the field of Rüstow, who was in fact a philologist before transcending the field of econoeconomics, had to teach economic geography afterwards based on the mics, had to teach economic geography afterwards based on the given terms of the contract. Later, he was entrusted to give economic given terms of the contract. Later, he was entrusted to give economic history and sociology courses which he already had better precondi-history and sociology courses which he already had better precondi-tions.tions.120 Things went easier for Kessler and Isaac. Isaac waThings went easier for Kessler and Isaac. Isaac was employed in s employed in a social politics chair under management professorship. As for Neu-a social politics chair under management professorship. As for Neu-mark, he was first recommended to teach social health courses and sta-mark, he was first recommended to teach social health courses and sta-tistics, which he felt himself completely alienated. Thentistics, which he felt himself completely alienated. Then,, Sarc undertook Sarc undertook

116 Neumark, Neumark, BoğaziçineBoğaziçine, , 125125..

117 Having graduated from the DarülfünunHaving graduated from the Darülfünun--i i IIstanbul Faculty of Law, Ülgener was stanbul Faculty of Law, Ülgener was appointed as an assistant in the Faculty of Economics. His works were mostly shaped appointed as an assistant in the Faculty of Economics. His works were mostly shaped under the influence of Max Weber and Werneunder the influence of Max Weber and Werner Sombart, focusing on the relation be-r Sombart, focusing on the relation be-tween economics and ethics, searching for the footsteps of underdevelopment in the tween economics and ethics, searching for the footsteps of underdevelopment in the daily lives, literary texts and Islamic traditions. Ülgener was among the most influen-daily lives, literary texts and Islamic traditions. Ülgener was among the most influen-tial academics in teaching Keynesian precepts in tial academics in teaching Keynesian precepts in the faculty during the 1950s.the faculty during the 1950s.

118 Neumark,Neumark, Boğaziçine,Boğaziçine, 125125..

119 http://iktisat.istanbul.edu.tr/?p=6520http://iktisat.istanbul.edu.tr/?p=6520

120 Neumark, Neumark, BoğaziçineBoğaziçine, , 8282..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

this task and Neumark was entrust

this task and Neumark was entrusted to give theoretical and political ed to give theoretical and political economy courses interchangeably by Röpke and Şükrü Baban. In the economy courses interchangeably by Röpke and Şükrü Baban. In the aftermath of Pelin’s death, all the finance courses were on Neumark’s aftermath of Pelin’s death, all the finance courses were on Neumark’s shoulders. Considering the remarks of his master Gerloff, he produced shoulders. Considering the remarks of his master Gerloff, he produced academic worksacademic works encapsulating both economic theory and politics. He encapsulating both economic theory and politics. He was also periodically giving history of economic thought courses was also periodically giving history of economic thought courses ––which which hehe said hesaid he liked mostliked most-- based on Turkish education system that takes its based on Turkish education system that takes its roots from the French style.roots from the French style.121

Interestingly, Neumark states

Interestingly, Neumark states that only one professor in ordinary that only one professor in ordinary was appointed to the faculty beginning from the late thirties till the end was appointed to the faculty beginning from the late thirties till the end of the war, that is Hazım Atıf Kuyucakof the war, that is Hazım Atıf Kuyucak122. Unlike the others, he studied at . Unlike the others, he studied at America and was giving his lectures based on the widely used American America and was giving his lectures based on the widely used American textbooks.textbooks.123 ThereforeTherefore,, we can see that in addition to the prewe can see that in addition to the pre--existing existing French ecole, and newly introduced German historial school, there is French ecole, and newly introduced German historial school, there is also some awareness about the American way of doing economics. Nev-also some awareness about the American way of doing economics. Nev-ertheless, it remained in the background as émigréertheless, it remained in the background as émigré economists’ impact economists’ impact dominated the faculty.dominated the faculty.

Aside from the doctrinal differences among the academics, the prob-

Aside from the doctrinal differences among the academics, the prob-lem of language was very central in the early years of the faculty. All lem of language was very central in the early years of the faculty. All of of the the émigréémigré academics were not able to learn Turkish rapidly and the academics were not able to learn Turkish rapidly and the TurkTurkish associates were not capable of perfect translation because most ish associates were not capable of perfect translation because most of them were able to speak French or rarer English. In the light of the of them were able to speak French or rarer English. In the light of the memoirs of Neumark, Ahmet Güner Sayar states memoirs of Neumark, Ahmet Güner Sayar states that onlythat only ÖmerÖmer CelâlCelâl SarcSarc andand MuhlisMuhlis EteEte werewere ableable toto perfectlyperfectly communicommunicatecate inin GermanGerman lan-lan-guage,guage, andand theythey helpedhelped RöpkeRöpke andand NeumarkNeumark inin translationtranslation asas theirtheir assis-assis-tants.tants. ButBut afterafter aa while,while, thethe GermanGerman ProfessorsProfessors sometimessometimes hadhad toto givegive lectureslectures inin FrenchFrench oror EnglishEnglish,, dependingdepending onon thethe translator’stranslator’s knowledgeknowledge

121 Neumark, Neumark, Boğaziçine,Boğaziçine, 8383..

122 Neumark, Neumark, Boğaziçine, Boğaziçine, 126.126. Hazım Atıf Kuyucak’s ideas are collected in the booklets Hazım Atıf Kuyucak’s ideas are collected in the booklets called called Radyo İktisat Saati KonuşmalarıRadyo İktisat Saati Konuşmaları ((AnkaraAnkara,, 19431943).). He was recognized by Neumark He was recognized by Neumark with his warmwith his warm--hearted and compatible character in addition to his practical economic hearted and compatible character in addition to his practical economic knowledge since he worked as a consultant in a foreign oil company.knowledge since he worked as a consultant in a foreign oil company.

123 Ibid., Ibid., 126126..

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of foreignforeign languagelanguage whichwhich tturnedurned outout toto bebe aa torturetorture bothboth forfor themthem andand thethe studentsstudents..124 Hence,Hence, asas itit cancan bebe seenseen inin thethe memoirsmemoirs ofof GültenGülten KazganKazgan whowho waswas aa studentstudent inin IstanbulIstanbul UniversityUniversity inin thethe latelate 1940s,1940s, manymany conceptsconcepts werewere remainedremained vaguevague forfor thethe studentsstudents andand withoutwithout beingbeing clearclear aboutabout thethe meaningsmeanings ofof thethe concepts,concepts, generalgeneral ideasideas ofof thethe coursescourses werewere notnot perfectlyperfectly captured.captured.125

2.2.7 Curriculum and Content of Economics EducationCurriculum and Content of Economics Education

It was intuitively stated by Bilsay Kuruç that the economic methodology

It was intuitively stated by Bilsay Kuruç that the economic methodology and knowledge that are comprehended in the cuand knowledge that are comprehended in the curriculrricula a of economics of economics are sensitive to the following points: are sensitive to the following points: ““TThe sociohe socio--economic structure of economic structure of the country and the development of this structure, the qualifications, the country and the development of this structure, the qualifications, instruments and the purposes of the applied economic policies, the po-instruments and the purposes of the applied economic policies, the po-sition and preferences sition and preferences of Turkey in international politics, the assess-of Turkey in international politics, the assess-ments and observations on the developments in politics, technology and ments and observations on the developments in politics, technology and organizations.organizations.””126 When we consider the curriculum of the faculty of When we consider the curriculum of the faculty of economics, we can feel theconomics, we can feel the presence of thise presence of this sensitivity portrayed by Ku-sensitivity portrayed by Ku-ruç. There were eight chairs establishedruç. There were eight chairs established127: : ““General Economics and General Economics and Economic TheoryEconomic Theory””128, , ““General Economics and Economic DoctrinesGeneral Economics and Economic Doctrines””129, ,

124 http://iktisat.istanbul.edu.tr/?page_id=6926http://iktisat.istanbul.edu.tr/?page_id=6926

125 GültenGülten KazganKazgan,, Bir İktisatçının TanıklıklarıBir İktisatçının Tanıklıkları (İstanbul: Bilgi Üniversitesi Yayınları, 2009),(İstanbul: Bilgi Üniversitesi Yayınları, 2009), 88.. However it should also be emphasized that it was not only because of the transla-However it should also be emphasized that it was not only because of the transla-tion problem but also the unfamiliarity of the students to some basic concepts like free tion problem but also the unfamiliarity of the students to some basic concepts like free marketmarket, capitalism and the theories of neoclassical school which deprived the econom-, capitalism and the theories of neoclassical school which deprived the econom-ics education of being completeics education of being complete. . Kazgan,Kazgan, 1010--1212..

126 KuruKuruç, ç, “İktisat Na“İktisat Nassılıl,,” 179” 179..

127 For a detailed examination of the courses For a detailed examination of the courses seesee Fındıkoğlu, Fındıkoğlu, Türkiye’de İktisatTürkiye’de İktisat, , 8181--111111..

128 TheThe course was given by Ord. Prof. Umberto Ricci, Prof. Dobretsberger, Associate Sabri course was given by Ord. Prof. Umberto Ricci, Prof. Dobretsberger, Associate Sabri Ülgener, Assistant Halit İlteberÜlgener, Assistant Halit İlteber..

129 Lectured by Ord. Prof. Şükrü Baban, Associate Açık, Assistant Rüştü AdakLectured by Ord. Prof. Şükrü Baban, Associate Açık, Assistant Rüştü Adak..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

“

“General Economics and Fiscal TheoryGeneral Economics and Fiscal Theory””130, , ““Economic History and Eco-Economic History and Eco-nomic Geographynomic Geography””131,, ““Public Finance and Acts of FinancingPublic Finance and Acts of Financing””132, , ““Busi-Busi-ness Economicsness Economics””133, , ““Statistics and Applied EconomicsStatistics and Applied Economics””134, , ““Sociology Sociology and Social Policyand Social Policy”.”.135 The firstThe first--year course program was determined in a year course program was determined in a framework consistingframework consisting Economic Theory (İktisat Teorisi)Economic Theory (İktisat Teorisi),, Economic Ge-Economic Ge-ography (İktisadi Coğrafya)ography (İktisadi Coğrafya),, The Nature of the Turkish Economy (Türki-The Nature of the Turkish Economy (Türki-ye İktisadının Bünyesi)ye İktisadının Bünyesi),, Economic and Social History (Ekonomik ve Economic and Social History (Ekonomik ve Sosyal Tarih). The law courses constituted almost the sixty Sosyal Tarih). The law courses constituted almost the sixty percentpercent of of the the program. program. Other constituents of the program were Other constituents of the program were Economic Doc-Economic Doc-trines trines ((İktisadi Doktrinler Tarihiİktisadi Doktrinler Tarihi),), International Trade International Trade ((Uluslararası Ti-Uluslararası Ti-caretcaret),), Conjunctures and Depressions, Conjunctures and Depressions, ((Konjonktür ve BuhranlarKonjonktür ve Buhranlar),), Agri-Agri-cultural and Industrial Politics cultural and Industrial Politics ((Ziraat ve Sanayi SiZiraat ve Sanayi Siyasetiyaseti),), Transportation Economics Transportation Economics ((Ulaştırma EkonomisiUlaştırma Ekonomisi)) Economic Systems Economic Systems and the Problem of Villageand the Problem of Village ((İktisat Sistemleri ve Köy Meselesiİktisat Sistemleri ve Köy Meselesi),), The His-The His-tory of Turkish Fiscal System tory of Turkish Fiscal System ((Türkiye MTürkiye Maaliye Tarihiliye Tarihi).).136

The course program was briefly

The course program was briefly mentioned abovementioned above in ordein order to reveal r to reveal the foundational basis of the foundational basis of the the economics education. This helps us see the economics education. This helps us see the priorities of both the economy and economics, and priorities of both the economy and economics, and deducededuce the relation the relation between the two.between the two. The emphasis on geography, transportation, agricul-The emphasis on geography, transportation, agricul-ture, village and industry seems tture, village and industry seems to reflect the current economic devel-o reflect the current economic devel-opment concerns of the country. The weight of history and doctrinal opment concerns of the country. The weight of history and doctrinal history in economics history in economics wawas pointedly in the foreground. Public finance s pointedly in the foreground. Public finance and social policy and social policy wewere much more a part of the main body of economics re much more a part of the main body of economics education witeducation with respect to today. It is clearly seen that tracing back to the h respect to today. It is clearly seen that tracing back to the 1930s,1930s, one wouldone would encounter with very different approaches in inter-encounter with very different approaches in inter-

130 Ord. Prof. Fritz Neumark, Prof. Refii Şükrü Suvla, AssistaOrd. Prof. Fritz Neumark, Prof. Refii Şükrü Suvla, Assistant Feridun Ergin and Assistant nt Feridun Ergin and Assistant Mihri BelliMihri Belli..

131 Ord. Prof. Rüstow, Prof. Ömer Lütfi Barkan, Assistant AçıkOrd. Prof. Rüstow, Prof. Ömer Lütfi Barkan, Assistant Açık..

132 Ord. Prof. Fazıl Pelin, Lecturer Faik Ökte, Associate Orhan Dikmen, Assistant Nurettin Ord. Prof. Fazıl Pelin, Lecturer Faik Ökte, Associate Orhan Dikmen, Assistant Nurettin MahrukiMahruki..

133 Ord. Prof. Alfred Isaac, Associate Ali Özeken, Ord. Prof. Alfred Isaac, Associate Ali Özeken, Assistant Nevzat GüneşAssistant Nevzat Güneş..

134 Ord. Prof. Ömer Celâl Sarc, Lecturer Nakibe Topuz, Assistant Mehmet OluçOrd. Prof. Ömer Celâl Sarc, Lecturer Nakibe Topuz, Assistant Mehmet Oluç

135 Ord. Prof. Gerhard Kessler, Prof. Z. Fındıkoğlu, Associare Orhan Tuna.Ord. Prof. Gerhard Kessler, Prof. Z. Fındıkoğlu, Associare Orhan Tuna.

136 http://iktisat.istanbul.edu.tr/wphttp://iktisat.istanbul.edu.tr/wp--content/uploads/2013/04/fakulte_albumu.pdfcontent/uploads/2013/04/fakulte_albumu.pdf

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preting the world, economy and economics.

preting the world, economy and economics. Özveren argues that this Özveren argues that this program was so qualified that it might outdistance many expprogram was so qualified that it might outdistance many expertise pro-ertise pro-grams today in terms of grams today in terms of its its manifoldness, elasticity and inner consisten-manifoldness, elasticity and inner consisten-cycy as itas it both reflectboth reflecteded the interdisciplinary and social approach of Ger-the interdisciplinary and social approach of Ger-man School man School as well as theas well as the theoretical economics.theoretical economics.137 In this line, In this line, elaborating on how elaborating on how the the locally adoptedlocally adopted/ translated / translated theories on econom-theories on econom-ics ics were were interacted with the country specific features of the current interacted with the country specific features of the current economy economy would present a unique experience for the evolution of na-would present a unique experience for the evolution of na-tional economic thought.tional economic thought.

§ 2.3 Concluding RemarksConcluding Remarks

We askedasked whywhy thethe facultyfaculty ofof economicseconomics waswas fofoundedunded inin IstanbulIstanbul insteadinstead ofof AnkaraAnkara inin thethe introductoryintroductory partpart ofof thisthis chapterchapter.. InIn fact,fact, itit isis notnot thatthat easyeasy toto givegive aa definitedefinite answeranswer forfor thatthat questionquestion,, butbut itit mightmight bebe becausebecause AnkaraAnkara waswas identifiedidentified withwith politicalpolitical lifelife asas aa centercenter ofof governancegovernance whilewhile IstanbIstanbul,ul, aa worldworld citycity withwith broadbroad economiceconomic andand socialsocial opportunitiesopportunities waswas consideredconsidered asas aa centercenter ofof attractionattraction forfor thethe prospectiveprospective economiceconomic dyna-dyna-mism,mism, inin whichwhich thethe nationalnational bourgeoisiebourgeoisie waswas expectedexpected toto playplay aa keykey role.role. Probably,Probably, thethe cosmopolitanismcosmopolitanism ofof IstanbulIstanbul andand iitsts opennessopenness toto thethe out-out-sideside worldworld werewere consideredconsidered significantsignificant inin formationformation ofof aa scientificscientific edu-edu-cationalcational frameworkframework thatthat waswas expectedexpected toto reflectreflect thethe harmoniousharmonious com-com-positionposition ofof variousvarious ideasideas andand theories.theories. EvenEven thethe namesnames ofof thethe institutionsinstitutions thatthat areare MülkiyeMülkiye andand DDarülfünunarülfünun mightmight havehave influencedinfluenced thethe receptionreception ofof thesethese institutions,institutions, asas MülkiyeMülkiye refersrefers toto issuesissues relatedrelated withwith statestate whilewhile DarülfünunDarülfünun ––althoughalthough thethe facultyfaculty waswas foundfound afterafter thethe uni-uni-versityversity reformreform –– refersrefers toto ““placeplace ofof sciencescience””.. OnOn anyany ground,ground, thethe facultyfaculty waswas foundedfounded withinwithin IstanbulIstanbul UniversityUniversity andand becamebecame thethe cradlecradle forfor thethe formationformation ofof economicseconomics discipline.discipline.

137 Özveren, “Türkiye’de Üniversite ve İktisat,” 414Özveren, “Türkiye’de Üniversite ve İktisat,” 414--415.415.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

In thethe 1010thth anniversaryanniversary ofof thethe foundationfoundation ofof thethe facultyfaculty,, FındıkoğluFındıkoğlu mamadede aa remarkremark onon thethe missionmission andand purposepurpose withwithinin aa historicalhistorical perspec-perspec-tive;tive; claimclaiminging thatthat thethe facultyfaculty ofof economicseconomics isis aa productproduct ofof aa longlong periodperiod startingstarting fromfrom thethe firstfirst thinkerthinker thatthat addressesaddresses thethe ilmilm--ii tedbirtedbir--ii menzilmenzil beforebefore thethe TanzimatTanzimat Era.Era. TheThe economicseconomics educationeducation whichwhich beganbegan asas aa twotwo--hourshours coursecourse inin MülkiyeMülkiye duringduring Tanzimat,Tanzimat, hadhad toto branchbranch outout inin thethe FacultyFaculty ofof LawLaw duringduring thethe SecondSecond ConstitutionalConstitutional MonarchyMonarchy138 andand thethe organicorganic coursecourse ofof eventsevents ledled toto thethe foundationfoundation ofof thethe facultyfaculty ofof econom-econom-ics.ics. FındıkFındıkoğluoğlu arguearguedd thatthat thethe birthbirth ofof thisthis institutioninstitution inin thethe cadrecadre ofof IstanbulIstanbul UniversityUniversity cancan bebe regardedregarded asas anan answeranswer toto thethe differentiationdifferentiation demandeddemanded byby thethe scientificscientific lifelife inin Turkey.Turkey. 19361936 refersrefers toto thethe yearyear thatthat economiceconomic sciencescience waswas departeddeparted naturallynaturally fromfrom thethe sciencescience ofof lawlaw andand emergedemerged asas aa separateseparate wholewhole evolvedevolved withwith thatthat differentiation.differentiation.139

The

The foundationfoundation ofof thethe facultyfaculty andand arrivalarrival ofof thethe GermanGerman émigréémigré economistseconomists refereferrrreded toto aa disengagementdisengagement fromfrom thethe FrenchFrench influencinfluence,e, whichwhich cancan bebe characterizedcharacterized asas thethe dominantdominant cculturalultural traditiontradition indeedindeed,, andand aa startingstarting pointpoint ofof thethe generationgeneration ofof aa newnew traditiontradition withwithinin whichwhich thethe foreignforeign figuresfigures playedplayed keykey roles.roles. InIn fact,fact, thethe GermanGerman impactimpact waswas notnot aa newnew thingthing;; aa theoreticaltheoretical intimacyintimacy forfor thethe GermanGerman HistoricalHistorical SchoolSchool waswas apparentapparent sincsincee thethe JeuneJeune TurcTurc periodperiod inin aattainingttaining thetheirir nationalnational devel-devel-opmentopment goal.goal. Yet,Yet, wewe shouldshould alsoalso notenote thatthat thethe newcomernewcomer academicsacademics werewere notnot reallyreally representativesrepresentatives ofof thethe GermanGerman HistoricalHistorical School,School, alt-alt-houghhough thethe influenceinfluence ofof thisthis ecoleecole existexisteded inin theirtheir viewpointsviewpoints atat somesome cases.cases. Instead,Instead, ttheyhey mightmight bebe identifiedidentified asas thethe membersmembers ofof aa GermanGerman typetype neoliberalism,neoliberalism, namelynamely ““ordoliberalismordoliberalism””,, aa socialsocial marketmarket economyeconomy--basedbased approachapproach whichwhich refusesrefuses thethe laissezlaissez fairefaire idealideal ofof thethe freefree marketmarket economyeconomy.. ThisThis argumentargument isis mostmost validvalid forfor RRöpkeöpke andand Rüstow,Rüstow, andand toto aa certaincertain degreedegree forfor Neumark.Neumark. So,So, wewe can’tcan’t definedefine thethe historicalhistorical evolutionevolution ofof economicseconomics asas aa transitiontransition fromfrom thethe FrenchFrench ecoleecole toto thethe GermanGerman His-His-

138 The branches were The branches were public finance (mpublic finance (maliyealiye)), Mesaliki İktisadiye, , Mesaliki İktisadiye, social economics social economics (i(iktisadi ktisadi iiçtimaiçtimai), ), economics (ieconomics (iktisaktisat)t),, statisticsstatistics (i(istatistikstatistik).). Fındıkoğlu, Fındıkoğlu, Türkiye’de Türkiye’de İktisatİktisat, 1, 124.24.

139 FındıkoFındıkoğlu, ğlu, Türkiye’de İktisatTürkiye’de İktisat, , 124124..

Ş E B N E M G E L M E D İ

torical

torical SchoolSchool whichwhich endedended upup byby thethe dominancedominance ofof thethe AngloAnglo--SaxonSaxon approaches.approaches. ThisThis procesprocesss waswas moremore intricate,intricate, multifacetedmultifaceted andand hetero-hetero-geneous.geneous.

In thisthis chapter,chapter, thethe initialinitial phasesphases ofof thethe storystory ofof economicseconomics disciplinediscipline duringduring thethe 1930s1930s wwereere concentratedconcentrated uponupon.. InIn thethe followingfollowing decades,decades, especiallyespecially inin thethe 1950s1950s andand thethe 1960s,1960s, thethe economicseconomics educationeducation becamebecame theoreticallytheoretically moremore completecomplete byby thethe professorshipprofessorshipss ofof thethe studentsstudents thisthis formerformer generationgeneration economistseconomists hadhad raised.raised. NurturedNurtured byby thethe legacylegacy ofof thethe GermansGermans andand TurkishTurkish academics,academics, theythey combinedcombined theirtheir theoreticaltheoretical infra-infra-structurestructure withwith thethe educationaleducational gainsgains ttheyhey attainedattained abroadabroad andand generat-generat-eded aa moremore usefuluseful analyticalanalytical perspective.perspective. OneOne mightmight thinkthink whetherwhether aa per-per-sistentsistent ecoleecole couldcould bebe establishedestablished oror notnot fromfrom thenthen on,on, oror toto whatwhat degreedegree thethe economicseconomics educationeducation becamebecame aa rolerole modelmodel forfor teachingteaching ofof economicseconomics inin prospectprospectiveive universities.universities. InIn answeringanswering thesethese questionsquestions,, variousvarious con-con-juncturaljunctural andand spatialspatial dynamicsdynamics gotgot involvedinvolved amongamong whichwhich therethere areare thethe statestate--universityuniversity relations,relations, changingchanging naturenature ofof economicseconomics disciplinediscipline andand thethe difficultiesdifficulties inin findingfinding andand maintainingmaintaining constantconstant dydynamicsnamics thatthat wouldwould givegive aa novelnovel touchtouch toto aa certaincertain ecole.ecole. AlthoughAlthough IstanbulIstanbul UniversityUniversity Facul-Facul-tyty ofof EconomicsEconomics mightmight notnot havehave transformedtransformed itsits traditiontradition intointo aa settledsettled ecoleecole thatthat wouldwould representrepresent forfor aa nationalnational schoolschool ofof thought,thought, itit cancan surelysurely bebe delineateddelineated asas aa nicheniche platformplatform inin whichwhich variousvarious ideasideas werewere ableable toto makemake groundground forfor them.them. AsAs thethe frameframe ofof thethe educationeducation waswas nonrigid,nonrigid, thethe evolutionaryevolutionary dynamicsdynamics ofof economiceconomic sciencescience andand thethe nuancesnuances inin thethe translationtranslation ofof theoriestheories werewere moremore apparentlyapparently seen.seen.

One

One lastlast point:point: EElaboratinglaborating onon thethe propoundedpropounded goalsgoals andand examiningexamining toto whatwhat degreedegree theythey couldcould bebe realizedrealized areare twotwo differentdifferent things.things. ThisThis chapterchapter –– andand thethe wholewhole dissertationdissertation indeedindeed –– waswas moremore concernedconcerned withwith thethe idealsideals andand thethe enthusiasmenthusiasm ofof thethe academicsacademics inin competingcompeting forfor theitheirr ideals,ideals, whichwhich mostlymostly referredreferred toto thethe objectiveobjective ofof beingbeing usefuluseful andand ac-ac-complishingcomplishing greatgreat thingsthings forfor thethe country,country, especiallyespecially duringduring thethe currentcurrent periodperiod ddiscussiscusseded inin thisthis dissertation.dissertation. AlthoughAlthough thethe repercussionsrepercussions ofof thesethese idealsideals inin realreal lifelife areare equallyequally –– andand maybemaybe eveneven moremore –– important,important, suchsuch anan examinationexamination isis leftleft outout ofof thethe scopescope ofof thisthis dissertation.dissertation. TheThe mainmain intentionintention ofof thisthis studystudy isis toto elaborateelaborate onon thethe waysways ofof thinkingthinking ofof

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

the

the academicsacademics inin translationtranslation ofof somesome theoriestheories andand keepkeep upup withwith thethe flu-flu-idityidity inin theortheoreticaletical conceptualizationsconceptualizations inin accordanceaccordance withwith thethe changchanginging flowsflows ofof thethe hegemonichegemonic economiceconomic knowledge.knowledge.

Ş E B N E M G E L M E D İ

3 The Definition, Scope and Method of EconomicsThe Definition, Scope and Method of Economics

his chapter focuses on how the discipline of economics was concep-

his chapter focuses on how the discipline of economics was concep-tualiztualized in the Turkish academic literature for the period between ed in the Turkish academic literature for the period between the 1930s andthe 1930s and the the 1960s. The basic source1960s. The basic sourcess will be economics textbooks will be economics textbooks at introductory level as well as the journal articles. The textbooksat introductory level as well as the journal articles. The textbooks se-se-lected are Wilhelm Röpke’s lected are Wilhelm Röpke’s Cemiyet EkonomisiCemiyet Ekonomisi (1937) a(1937) and nd Ekonominin Ekonominin Bugünkü MeseleleriBugünkü Meseleleri, Josef Dobretsberger’s , Josef Dobretsberger’s Ekonomi SiyasetiEkonomi Siyaseti (1940), Fritz (1940), Fritz Neumark’s Neumark’s Umumi İktisat TeorisiUmumi İktisat Teorisi (1940(1940--19421942--1944), Refii Şükrü Suvla’s 1944), Refii Şükrü Suvla’s Nazari İktisatNazari İktisat (1949) and Şükrü Baban’s (1949) and Şükrü Baban’s İktisat İlminin Umumi Pren-İktisat İlminin Umumi Pren-siplerisipleri (1957). (1957). TThehe time intervaltime intervals between the textbooks would be help-s between the textbooks would be help-ful in seeing the moving parts regarding the ful in seeing the moving parts regarding the basic basic conceptualizations. As conceptualizations. As the articles, textbooks and conference presentations demonstrate, the articles, textbooks and conference presentations demonstrate, cer-cer-tain tain economic theorieseconomic theories have come into prominence at certain stages. have come into prominence at certain stages. Yet, aYet, anyny theory was totally adopted as it is; instead, theories were trans-theory was totally adopted as it is; instead, theories were trans-lated in accordance with the complex perspectives of the academics and lated in accordance with the complex perspectives of the academics and one would beone would be confronted with an eclectic viewpoint in various aspectsconfronted with an eclectic viewpoint in various aspects of the disciplineof the discipline. .

This chapter differs from the

This chapter differs from the following chapters in the sense that thefollowing chapters in the sense that the theoretical schools leaned towards in understanding the definition, theoretical schools leaned towards in understanding the definition, scope and method of economics were less mentioned for the chapters scope and method of economics were less mentioned for the chapters regarding public finance, social policy and development economics. This regarding public finance, social policy and development economics. This

Ş E B N E M G E L M E D İ

might b

might be mostly related with an effort to construct the base on a strong e mostly related with an effort to construct the base on a strong theoretical ground which theoretical ground which wawas not expected to come under the influence s not expected to come under the influence of changes in economic policies. of changes in economic policies. In this chapter,In this chapter, the approach the approach ““science science for the sake of sciefor the sake of scienncece”” wawas prominent at discurs prominent at discursive level although one sive level although one can can notice the existence of some value judgements regarding ideological notice the existence of some value judgements regarding ideological positions. Despite the apparent positions. Despite the apparent and some presumable and some presumable differences, differences, the the content of content of this chapter this chapter isis closercloser to its equivalents today, with respect to to its equivalents today, with respect to other chapters.other chapters. This might be becauseThis might be because ofof the theoretical weight of Röp-the theoretical weight of Röp-keke,, the chair of general economics and economic theorythe chair of general economics and economic theory; regardless of ; regardless of the short span of time he stayed here, the short span of time he stayed here, he he stands out in this chapter as astands out in this chapter as a centralcentral reference pointreference point..

This chapter emphasizes the key

This chapter emphasizes the key points on the belowpoints on the below--mentioned mentioned subtitles. As for each subtitle, the related theories will be explained subtitles. As for each subtitle, the related theories will be explained briefly to reveal the argumentations about that subtitle at the local level. briefly to reveal the argumentations about that subtitle at the local level. Hence, the theoretical positions visHence, the theoretical positions vis--àà--vis that issue are expected to be vis that issue are expected to be asceascertained. First, how the definition and subject matter of economics rtained. First, how the definition and subject matter of economics wawas conceptualized since the foundation of the Faculty of Economics in s conceptualized since the foundation of the Faculty of Economics in Istanbul University is examined. The relation between the science of Istanbul University is examined. The relation between the science of economics and economic policies via determining teconomics and economic policies via determining the boundaries of the he boundaries of the role of economists will also be emphasized. This part is important bothrole of economists will also be emphasized. This part is important both in thein the sense that it indicates the deviations from today’s perception of sense that it indicates the deviations from today’s perception of economics and the current traditions. In the second part, the methodo-economics and the current traditions. In the second part, the methodo-logical preferences alogical preferences and the reflections of the methodology debates as nd the reflections of the methodology debates as they had a broad repercussion once, will be examined. Next, theories of they had a broad repercussion once, will be examined. Next, theories of value and price are scrutinized in order to portray the theoretical pref-value and price are scrutinized in order to portray the theoretical pref-erences of the academics. In the following part, the productionerences of the academics. In the following part, the production and dis-and dis-tribution theories are elaborated. These two parts will be mainly based tribution theories are elaborated. These two parts will be mainly based on textbooks as they constitute the core contents of economics disci-on textbooks as they constitute the core contents of economics disci-pline.pline. One canOne can seesee that there that there existedexisted an oscillation between the an oscillation between the currentcurrent theories and the main concerntheories and the main concern of thof the academicse academics waswas thethe presentation of presentation of all, all, the the criticism of all, then taking a stand in a concealed way. Finally, criticism of all, then taking a stand in a concealed way. Finally, variousvarious economics textbooks utilized in Europe and the USAeconomics textbooks utilized in Europe and the USA will be will be briefly mentionedbriefly mentioned, with the intent of making an evaluation on the, with the intent of making an evaluation on the locallocal textbtextbooks within a comparative perspective. In conclusion, how the dif-ooks within a comparative perspective. In conclusion, how the dif-

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

ferent considerations based on the peculiarities of the country led to

ferent considerations based on the peculiarities of the country led to perceptional divergence from existing theories and implementationsperceptional divergence from existing theories and implementations will be revealedwill be revealed..

§ 3.1 The The Definition and Subject MatterDefinition and Subject Matter of Economicsof Economics

3.1.1 Theories Around the WorldTheories Around the World

In today’s mainstream introduction to economics textbooks, the an-

In today’s mainstream introduction to economics textbooks, the an-swers for the question “what is economics?” mainly focuses on the scar-swers for the question “what is economics?” mainly focuses on the scar-city city approach. A current economics student would be familiar with the approach. A current economics student would be familiar with the definitidefinition that “economics is the allocation of scarce resources”. A wellon that “economics is the allocation of scarce resources”. A well--accepted textbook writer Mankiw’s definition is based on “how society accepted textbook writer Mankiw’s definition is based on “how society manages its scarce resources”manages its scarce resources”1 In the widely used textbook of In the widely used textbook of BeggBegg, , it is it is defined as “the study of how society decides defined as “the study of how society decides what, how and for whom to what, how and for whom to produce.”produce.”2 According to the textbook of StiglitzAccording to the textbook of Stiglitz, “economics studies how , “economics studies how individuals, firms and governments and other organizations within our individuals, firms and governments and other organizations within our society make society make choices, choices, and how these choices determine society’s use of and how these choices determine society’s use of its resources.”its resources.”3 A more heterodox book of Goodwin on the other hand A more heterodox book of Goodwin on the other hand makes an alternative definition makes an alternative definition asserting thatasserting that “economics is the study of “economics is the study of the way people organize themselves to sustain life and enhance its qual-the way people organize themselves to sustain life and enhance its qual-

1 Roger Backhouse and SRoger Backhouse and Steventeven Medema, “Retrospectives: On the Definition of Medema, “Retrospectives: On the Definition of EconomicsEconomics,”,” The Journal of Economic PerspectivesThe Journal of Economic Perspectives 23, no.23, no. 1 (2009): 222. Retrieved May 1 (2009): 222. Retrieved May 15, 2021, from http://www.jstor.org/stable/2764830215, 2021, from http://www.jstor.org/stable/27648302

2 David BDavid Begg, Stanley Fischer, Rudiger Dornbusch, egg, Stanley Fischer, Rudiger Dornbusch, Economics Economics (London: Mc Graw Hill, (London: Mc Graw Hill, eighth edition), 3.eighth edition), 3.

3 Joseph StiglitzJoseph Stiglitz and and Carl E. Walsh, Carl E. Walsh, Principles of MacroeconomicsPrinciples of Macroeconomics, , (USA: (USA: W. W. Norton & W. W. Norton & Company, fourth editionCompany, fourth edition),), 12.12.

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ity.”

ity.”4 Indeed, Indeed, finding a broad definition of economics is dfinding a broad definition of economics is difficult because ifficult because the matters to be considered within the framework of science and the the matters to be considered within the framework of science and the ones that should remain outside could not easily be distinguished. If we ones that should remain outside could not easily be distinguished. If we assert that economics is the examination of material wealth, it would assert that economics is the examination of material wealth, it would difficult to tell what is mdifficult to tell what is material and what is not. If we assume that eco-aterial and what is not. If we assume that eco-nomics merely contains exchange issues, it would again be inadequate nomics merely contains exchange issues, it would again be inadequate as we know that its concerns are beyond the exchangeability of the as we know that its concerns are beyond the exchangeability of the goods. This discrepancy makes the definition of economics a disputable goods. This discrepancy makes the definition of economics a disputable fiefield for different schools of thoughts and authors.ld for different schools of thoughts and authors.

Although there still are various definitions, it seems like the defini-

Although there still are various definitions, it seems like the defini-tion of economics doesn’t occupy the agenda as it was in the late 19tion of economics doesn’t occupy the agenda as it was in the late 19thth and the early 20and the early 20thth centurycentury;; during when the definition, scope andduring when the definition, scope and meth-meth-od of economics wod of economics wereere central mattercentral matterss of debate among many scholars. of debate among many scholars. Through the heyday of the classical school, almost all the definitions of Through the heyday of the classical school, almost all the definitions of economics were tied to the concept of wealth and political economy was economics were tied to the concept of wealth and political economy was mostly related with economic growth.mostly related with economic growth.5 AA careful reader might have no-careful reader might have no-ticedticed thatthat the word “political” was added in front of “economy”, which the word “political” was added in front of “economy”, which meant an extension of the matter to the level of nations.meant an extension of the matter to the level of nations.6 Yet, thYet, the con-e con-siderations on political economy also differed among the classical siderations on political economy also differed among the classical thinkers. For insthinkers. For instance, tance, iit was considered as a facet of moral philosophy t was considered as a facet of moral philosophy in a larger system in Adam Smith’s works; while Ricardo and Say saw in a larger system in Adam Smith’s works; while Ricardo and Say saw themselves as the actors of emergence for political economy as a new themselves as the actors of emergence for political economy as a new and separate branch of science.and separate branch of science.7

4 Neva Goodwin, Julie NelsonNeva Goodwin, Julie Nelson andand JonathaJonathan Harris, n Harris, Macroeconomics in ContextMacroeconomics in Context ((New New YorkYork:: M. E. Sharp Inc , 2009M. E. Sharp Inc , 2009), ), 33..

5 John Baptiste Say defines political economy as the John Baptiste Say defines political economy as the “science that treats the“science that treats theproduction, production, distribution and consumption of wealthdistribution and consumption of wealth””.. Backhouse and Medema, “Backhouse and Medema, “RetrospectivesRetrospectives”, ”, 223,223, quotquoted ined in ((SaySay,, 1801803)3). Mill’s definition . Mill’s definition of political economy of political economy was “the science was “the science which traces the laws of such of the phenomena of society as arise from the combined which traces the laws of such of the phenomena of society as arise from the combined operations of mankind for the production of wealth, in so far as those phenomena are operations of mankind for the production of wealth, in so far as those phenomena are not modifienot modified by the pursuit of any other object.d by the pursuit of any other object.”” Ibid., Ibid., 223223,, quotedquoted in in Mill Mill ((1844 1844 (1967)(1967): : 323323).).

6 Backhouse and Medema, “Backhouse and Medema, “RetrospectivesRetrospectives,” 223.,” 223.

7 Backhouse and Medema, “Backhouse and Medema, “RetrospectivesRetrospectives,” ,” 223223..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

Although wealth

Although wealth--based definitibased definitions were dominant, arguments for a ons were dominant, arguments for a definition based on the science of exchanges via Mises, Hayek, Buchanan definition based on the science of exchanges via Mises, Hayek, Buchanan also came to agenda in the 19also came to agenda in the 19thth and 20and 20thth century. Then the individualis-century. Then the individualis-tic element stepped in during the modern era and the definitions em-tic element stepped in during the modern era and the definitions em-phasizing tphasizing the role of human behavior came to the forefront especially he role of human behavior came to the forefront especially by the pioneers of marginalism. Carl Menger, who was influenced by by the pioneers of marginalism. Carl Menger, who was influenced by Marshall and Jevon’s focus on psychology in understanding economic Marshall and Jevon’s focus on psychology in understanding economic actions, claimed that economics is “related to the practical acactions, claimed that economics is “related to the practical activities of tivities of economizing men”economizing men”8. For Jevons, economics can be depicted as “a calcu-. For Jevons, economics can be depicted as “a calcu-lus of pleasure and pain” which signified the fact that the definition of lus of pleasure and pain” which signified the fact that the definition of political economy or economicspolitical economy or economics9 was drifting apart from the wealthwas drifting apart from the wealth--based approach to a focus on utilitbased approach to a focus on utility. By the shift towards seeing “eco-y. By the shift towards seeing “eco-nomics as a study of man” in Marshallian understanding, the individual-nomics as a study of man” in Marshallian understanding, the individual-istic element was becoming clearer via the Austrians’ approach.istic element was becoming clearer via the Austrians’ approach.10 In In addition the increasing weight of the psychological aspects and individ-addition the increasing weight of the psychological aspects and individ-ualistic conualistic constituients, the “scarcity” concept came to forefront particu-stituients, the “scarcity” concept came to forefront particu-larly in the interwar period. The LSE economist Lionel Robbins’ defini-larly in the interwar period. The LSE economist Lionel Robbins’ defini-tion of economics as “the science which studies human behavior as a tion of economics as “the science which studies human behavior as a relationship between ends and scarce means which have alterelationship between ends and scarce means which have alternative rnative uses”uses”11 was among the most commonly accepted definitions. However, was among the most commonly accepted definitions. However, many criticisms were oriented against. Some found it too broad as “it many criticisms were oriented against. Some found it too broad as “it failed to divide economics sufficiently from other sciences” and some failed to divide economics sufficiently from other sciences” and some found it too narrow as “it heavily tilted found it too narrow as “it heavily tilted toward theory and left little toward theory and left little room for empirical analysis, history, and institutionsroom for empirical analysis, history, and institutions-- it essentially it essentially wrote ethics out of economics.”wrote ethics out of economics.”12

8 IbIbiidd., ., 224224, cited in , cited in Menger Menger ((1871(1976)1871(1976): : 4848).).

9 IbIbiidd., ., 222244.. This shift from political economy to economics was becoming clear by This shift from political economy to economics was becoming clear by Marshall, who supports to use of the latter as a part establishing economics as a scien-Marshall, who supports to use of the latter as a part establishing economics as a scien-tific field by distancing itself from political interferences or ideological commitments. tific field by distancing itself from political interferences or ideological commitments. IbidIbid..,, 225225..

10 IbIbiidd., ., 224224.. Wicksell’s and Wicksteed’s views Wicksell’s and Wicksteed’s views were were influenced by the Austrian Schoolinfluenced by the Austrian School..

11 IbIbiidd.,., 229229, cited in Robbins (1932:15)., cited in Robbins (1932:15).

12 Backhouse and Medema, “Backhouse and Medema, “RetrospectivesRetrospectives,” ,” 225225..

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Robbins’ definition was not really appreciated in the English or

Robbins’ definition was not really appreciated in the English or American textbooks in the 1920s and the 1930s, as the MarAmerican textbooks in the 1920s and the 1930s, as the Marshallian and shallian and institutionalist economists were unwilling to accept such a conceptual-institutionalist economists were unwilling to accept such a conceptual-ization.ization.13 However, there occurred a gradual tendency toward a broader However, there occurred a gradual tendency toward a broader assent of Robbins’ definitionassent of Robbins’ definition14 after the Wafter the World orld WWar ar II, which means the II, which means the domain of economics was becomingdomain of economics was becoming narrower and technical then.narrower and technical then.15 Alt-Alt-hough the scarcity issue was central in Robbins’s definition, there was hough the scarcity issue was central in Robbins’s definition, there was no mention for rationality or maximizing behavior. Starting from the no mention for rationality or maximizing behavior. Starting from the 1940s, the greater emphasis was laid on the choice process. By Kenneth 1940s, the greater emphasis was laid on the choice process. By Kenneth Arrow in tArrow in the 1950s, the focus was shifted to rational action, even before he 1950s, the focus was shifted to rational action, even before maximizing behaviors.maximizing behaviors.16 Finally, the rationality assumption was com-Finally, the rationality assumption was com-bined with the maximizing behavior in the 1970s. Gary Becker’s defini-bined with the maximizing behavior in the 1970s. Gary Becker’s defini-tion, although mostly consistent with Robbins, extended ttion, although mostly consistent with Robbins, extended the scope of he scope of economics to embrace all the facets of human life and decision mak-economics to embrace all the facets of human life and decision mak-ing.ing.17

Jacob Viner

Jacob Viner, , who is accepted as one of the most inspirational econo-who is accepted as one of the most inspirational econo-mists of the Chicago School in the 1930s, claims that definitions are less mists of the Chicago School in the 1930s, claims that definitions are less

13 IbIbiidd., ., 225225. .

14 Robbins’ article had repercussions not onlyRobbins’ article had repercussions not only among his European colleagues but also among his European colleagues but also among the members of the faculty of economics in the sense that it attracts the atten-among the members of the faculty of economics in the sense that it attracts the atten-tion to the dichotomy that: “does economics examine what already exists or what tion to the dichotomy that: “does economics examine what already exists or what should exist”. A very central theme is whether econshould exist”. A very central theme is whether economics is a normative science or notomics is a normative science or not..

15 As also argued by Backhouse and Medema, tAs also argued by Backhouse and Medema, this his was most probablywas most probably related with the related with the urgent problems regarding the logistics of military strategies which required econo-urgent problems regarding the logistics of military strategies which required econo-mists to work right along with the engineers and scimists to work right along with the engineers and scientists during the war. This situa-entists during the war. This situa-tion continued for the Cold War, with an increasing emphasis on game theory and tion continued for the Cold War, with an increasing emphasis on game theory and operations research.operations research. IbIbiidd., ., 226226..

16 The increasing significance on rational choice might be related with the Cold War The increasing significance on rational choice might be related with the Cold War atmosphere, it was favoatmosphere, it was favored to defend capitalist democracies against Soviet collectivism red to defend capitalist democracies against Soviet collectivism to ground efficient markets to ground efficient markets --like planninglike planning-- on rationality principle. Ibon rationality principle. Ibid.,id., 228228, cited in , cited in AmadaeAmadae ((20032003).).

17 ““TThe combined assumptions of maximizing behavior, market equilibrium, and stable he combined assumptions of maximizing behavior, market equilibrium, and stable preferences, used relentlessly and unflinchingly, form the heart of the economic ap-preferences, used relentlessly and unflinchingly, form the heart of the economic ap-proach as I see it” Backhouseproach as I see it” Backhouse and Medema, “Retrospectives,”and Medema, “Retrospectives,” 229229,, cited incited in Gary BeckerGary Becker ((19761976: : 55).).

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

significant than actions, as e

significant than actions, as economics is potentially too broad.conomics is potentially too broad.18 Yet, as Yet, as Backhouse Backhouse and Medemaand Medema suggestsuggest “definitions can also reflect the direc-“definitions can also reflect the direc-tion in which their authors want to see the subject move and can even tion in which their authors want to see the subject move and can even influence practice.”influence practice.”19 To put it in another way, we can say that adhering To put it in another way, we can say that adhering aa specific definition may influence the practice of economics; restrain specific definition may influence the practice of economics; restrain the framework of science; determine which themes are worth tackling the framework of science; determine which themes are worth tackling and the methods they utilize in tackling them.and the methods they utilize in tackling them.20

3.1.2 Theories Internalized in TurkeyTheories Internalized in Turkey

3.1.2.1 On Definition of EconomicsOn Definition of Economics

The d

The definition and scope of economics wefinition and scope of economics wereere also debated in the journal also debated in the journal of the faculty of economics and the debates between the European of the faculty of economics and the debates between the European economists had great coverage in the articles which indicates about the economists had great coverage in the articles which indicates about the adopted viewpoints. Especially, Röpke, Neumarkadopted viewpoints. Especially, Röpke, Neumark andand BaBaban with their ban with their books and articles; Perkinbooks and articles; Perkin21 and Rüstow in their detailed writings, in-and Rüstow in their detailed writings, in-vestigated on what “economics” really comprehends. Throughout the vestigated on what “economics” really comprehends. Throughout the books, a common denominator books, a common denominator appears asappears as their emphasis on defining their emphasis on defining economics as a “social science.” Howevereconomics as a “social science.” However, the tone of the writings re-, the tone of the writings re-flects a strong loyalty to “rationality” principleflects a strong loyalty to “rationality” principle22, “consistency” and , “consistency” and

18 IbIbiidd., ., 22222.2.

19 IbIbiidd., ., 2231.31.

20 Ibid., Ibid., 231. 231.

21 The article oThe article off RasimRasim PerkinPerkin,, “Ekonomi İlminin Mahiyeti“Ekonomi İlminin Mahiyeti,,” ” İÜİFMİÜİFM 3, no: 13, no: 1--2 (1942)2 (1942) represents a detailed panorama about the debates of the nineteenth century. It is a represents a detailed panorama about the debates of the nineteenth century. It is a good example of how the different perceptions related with the nature of economics good example of how the different perceptions related with the nature of economics are reflected on the journal of econare reflected on the journal of economics in Istanbul University.omics in Istanbul University.

22 At this point, I should note that Röpke’s understanding of rationality is divergent from At this point, I should note that Röpke’s understanding of rationality is divergent from the neoclassical thinking. He argues that the meaning of rationality which he appreci-the neoclassical thinking. He argues that the meaning of rationality which he appreci-ates is comprehending the world via wisdom, by cates is comprehending the world via wisdom, by causality functions. On the other ausality functions. On the other

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“laws”; which are mostly the characteristics of the positive sciences. If

“laws”; which are mostly the characteristics of the positive sciences. If we just address the definition parts to generalize the viewpoints of the we just address the definition parts to generalize the viewpoints of the authors, authors, we might have thought that they are generally proponents of we might have thought that they are generally proponents of the neoclassical theory. On the other hand, it is clearly seen that the the neoclassical theory. On the other hand, it is clearly seen that the general contents of the books show some deviations from the frame-general contents of the books show some deviations from the frame-work of work of the the neoclassical approach.neoclassical approach.

Through the texts, the “

Through the texts, the “scarcity” approach becomes prominent as scarcity” approach becomes prominent as there are never ending needs but one has to make choices among them. there are never ending needs but one has to make choices among them. For Neumark, the task of economics is to “achieve a substantive harmo-For Neumark, the task of economics is to “achieve a substantive harmo-ny between the needs and the material tools to satisfy them.”ny between the needs and the material tools to satisfy them.”23,, Eco-Eco-nomic actionomic action is defined as “a farn is defined as “a far--reaching struggle against the scarcity of reaching struggle against the scarcity of resources”resources”24 by Suvla. Aiming to increase wealth via selfby Suvla. Aiming to increase wealth via self--interest and interest and minimum effort signifies a tendency towards the neoclassical approach. minimum effort signifies a tendency towards the neoclassical approach. The neoclassical tone reveals itself in Baban’s teThe neoclassical tone reveals itself in Baban’s textbook as well. In addi-xtbook as well. In addi-tion to affirming maximization of selftion to affirming maximization of self--interest; he, by criticizing and re-interest; he, by criticizing and re-jecting the classical schools’ definition related with welfarejecting the classical schools’ definition related with welfare25, adopts the , adopts the analytical view of Lionel Robbins. Not surprisingly, the central theme analytical view of Lionel Robbins. Not surprisingly, the central theme

hand, leaning the social phenomenon upon rational motives is methodologically

hand, leaning the social phenomenon upon rational motives is methodologically wrong. Röpke, wrong. Röpke, Ekonomi İlminin, Ekonomi İlminin, 99--10.10.

23 Fritz Fritz Neumark, Neumark, Genel Ekonomi Teorisi v.1 Genel Ekonomi Teorisi v.1 (İstanbul: İ. Akgün Matbaası, 1944), 9, 15; (İstanbul: İ. Akgün Matbaası, 1944), 9, 15; Şükrü Şükrü BabanBaban, , İktisad İlminin Umumî Prensipleri v.1 İktisad İlminin Umumî Prensipleri v.1 (İstanbul: Çeltüt Matbaası, 1957), (İstanbul: Çeltüt Matbaası, 1957), 55--9.9.

24 Refii Şükrü Refii Şükrü Suvla,Suvla, Umumi İktisat Dersleri BirincUmumi İktisat Dersleri Birinci Kitap Nazarî İktisat i Kitap Nazarî İktisat (İstanbul: İsmail (İstanbul: İsmail Akgün Matbaası, 1949),Akgün Matbaası, 1949), 1212..

25 The classical school thinkers designated the subject matter of economics by The classical school thinkers designated the subject matter of economics by investigating whether the human activity is related with the human welfare or not. investigating whether the human activity is related with the human welfare or not. Here we should note that Here we should note that the term welfare means wealth, procuring the material con-the term welfare means wealth, procuring the material con-ditions of welfare. However, it includes a chaotic aspect. ditions of welfare. However, it includes a chaotic aspect. Baban mentions that iBaban mentions that it is very t is very hard to determine the material conditions of welfare and human behavior in a societyhard to determine the material conditions of welfare and human behavior in a society. . By choosing such a methBy choosing such a methodologyodology,, the classical thinkers somehow narrowed the do-the classical thinkers somehow narrowed the do-main of the economic science. The decision of how much time will be dedicated to main of the economic science. The decision of how much time will be dedicated to provision of welfare and how much would be used for other purposes is also consid-provision of welfare and how much would be used for other purposes is also consid-ered as an economic decision. In other ered as an economic decision. In other words, it is words, it is aa matter of the scarce resources. matter of the scarce resources. Then one can say that every human activity has an economic face and the economists Then one can say that every human activity has an economic face and the economists examine them within this face. Baban, examine them within this face. Baban, İktisad İlmininİktisad İlminin, , 33--66..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

occurs as th

occurs as the scarcity problem again. For him, “economics examines the e scarcity problem again. For him, “economics examines the forms of human behaviors while utilizing the scarce resources.”forms of human behaviors while utilizing the scarce resources.”26 Those Those behaviors must be predictable in order for economics proved to be sci-behaviors must be predictable in order for economics proved to be sci-ence. Human preferences and alternative opportunities to ence. Human preferences and alternative opportunities to use those use those scarce resources are the basic themes in defining economics. scarce resources are the basic themes in defining economics.

All the authors acknowledg

All the authors acknowledgeses that economics is a branch of social that economics is a branch of social science. Neumark says that although economic action is intellectual, it is science. Neumark says that although economic action is intellectual, it is not abstract. Economics deals with social anot abstract. Economics deals with social actions in the sense that each ctions in the sense that each individual is interdependent to other individuals and social communi-individual is interdependent to other individuals and social communi-ties’ economic actionsties’ economic actions..27 Suvla also starts with the emphasis that eco-Suvla also starts with the emphasis that eco-nomics is a part of social science but his definition is somehow differ-nomics is a part of social science but his definition is somehow differ-ent, he claims thaent, he claims that economics deals with social actions based on selft economics deals with social actions based on self--interest /personal benefit.interest /personal benefit.28 The rationality principle here comes to The rationality principle here comes to forefront. Indeed, Neumark asserts that forefront. Indeed, Neumark asserts that the the rationality principle is not rationality principle is not only valid for economics but for all human actions.only valid for economics but for all human actions.29 HoweverHowever, , while we while we are focusing on modelling the human behavior, the interesting part is are focusing on modelling the human behavior, the interesting part is the claim that economics is not based on the assumption that humans the claim that economics is not based on the assumption that humans are rational in fact; but the assumption itself has a practical importance are rational in fact; but the assumption itself has a practical importance in guiding them to behave rationalin guiding them to behave rational..30

We see an edge point in definition of economics along Rasim Per-kin’s article in which he reveals the definitions alleged by different scholars most of which belong to the neoclassical ideology, together with criticisms voiced against them. Perkin also upholds the Lionel Robbins’ approach but even more, he asserts that although it is hard to measure all economic acts de facto with monetary measures, it is possi-ble to mentally attach a price to these activities.31 This point of view reminds the recently died neoliberal economist Gary Becker, who en-

26 Baban,Baban, İktisad İlmininİktisad İlminin, , 88..

27 Neumark, Neumark, Genel Ekonomi, Genel Ekonomi, 18.18.

28 Suvla, Suvla, Nazari İktisat, Nazari İktisat, 12.12.

29 Neumark, , Neumark, , Genel Ekonomi, Genel Ekonomi, 11.11.

30 Baban,Baban, İktisad İlmininİktisad İlminin, , 1616..

31 Perkin, “Ekonomi İlminin”, 29.Perkin, “Ekonomi İlminin”, 29.

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larged the scope of economics by attaching a quantitative value to social issues and putting it into a utility function. By doing this, the border of economics is so expanded that every human behavior become explain-able with the cost benefit analysis via the utility function.

3.1.2.2 Positive of Normative? What “is” or Positive of Normative? What “is” or WWhat “ought to be”hat “ought to be”

In defining the boundaries of economics, t

In defining the boundaries of economics, the morality question lies at he morality question lies at the heart of the arguments: Is economics a positive or a normathe heart of the arguments: Is economics a positive or a normative sci-tive sci-ence? The answers of the academics for this question and the conceptu-ence? The answers of the academics for this question and the conceptu-alized nature of economic science can be enlightened by scrutinizing the alized nature of economic science can be enlightened by scrutinizing the desired level of its limitations. For the authors, economics is just compe-desired level of its limitations. For the authors, economics is just compe-tent to demonstrate the current tent to demonstrate the current situation or what is going to happen. It situation or what is going to happen. It can’tcan’t/shouldn’t/shouldn’t determine what determine what is ought tois ought to be done with metabe done with meta--economic concernseconomic concerns. . Röpke, a pioneer figure advocating for “what is” Röpke, a pioneer figure advocating for “what is” approachapproach,, argues that argues that “the legitimate purpose of the economic science “the legitimate purpose of the economic science should only be tshould only be to comprehend the reality.”o comprehend the reality.”32 In line with Röpke, Neu-In line with Röpke, Neu-mark also expostulates the concept of “moral economy” by claiming it to mark also expostulates the concept of “moral economy” by claiming it to be an illicit mix of science and beliefsbe an illicit mix of science and beliefs..33 This stance is strengthened by This stance is strengthened by

32 Wilhelm Wilhelm Röpke,Röpke, “Piyasa İktisadının Kuruluşu ve Mekanizması,” in“Piyasa İktisadının Kuruluşu ve Mekanizması,” in EEkonominin Bugünkü konominin Bugünkü MeseleleriMeseleleri (İstanbul: İ(İstanbul: İstanbul Üniversitesi Hukuk Fakültesi İktisat ve İçtimaiyat En-stanbul Üniversitesi Hukuk Fakültesi İktisat ve İçtimaiyat En-stitüsü Neşriyatı, 1934),stitüsü Neşriyatı, 1934), 25.25.

33 Ömer Celal SarcÖmer Celal Sarc,, rreview of eview of Ekonomi Siyasasının Yeni İdeolojileriEkonomi Siyasasının Yeni İdeolojileri by Fritz Neumark, by Fritz Neumark, İÜHFMİÜHFM 2, (1936): 167.2, (1936): 167. Ömer Celal SarcÖmer Celal Sarc in his review claims that thein his review claims that the purpose ofpurpose of the the book is to set forth an objective examination of the most important ideals and ideas book is to set forth an objective examination of the most important ideals and ideas that dominates the economic policy in European countries. The point here is, while that dominates the economic policy in European countries. The point here is, while examining the interventions on wages and interest, autarky and neomercantilist poli-examining the interventions on wages and interest, autarky and neomercantilist poli-cies, Neumark identifies that most of the actions of the state are influenced by cies, Neumark identifies that most of the actions of the state are influenced by metaeconomic concerns rather than economic ones. After analyzing the movement of metaeconomic concerns rather than economic ones. After analyzing the movement of thoughts, the potential results of the current situation for economic science and life thoughts, the potential results of the current situation for economic science and life are menare mentioned. tioned. Sarc, 166.Sarc, 166. Sarc argues that iSarc argues that in spite of being aware of the fact that the n spite of being aware of the fact that the

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

Suvla’s assertion that economics is neither moral nor amora

Suvla’s assertion that economics is neither moral nor amorall34, and al-, and al-truism is not a part of economicstruism is not a part of economics35 and finally, Baban also points that and finally, Baban also points that rational behavior doesn’t carry out a moral meaning.rational behavior doesn’t carry out a moral meaning.36 Remaining loyal Remaining loyal to the definition of Lionel Robbins all throughout his articleto the definition of Lionel Robbins all throughout his article37,, Perkin Perkin claims that examining what is to claims that examining what is to be done is out of the framework of the be done is out of the framework of the science. It is mentioned that economic theory is science. It is mentioned that economic theory is notnot economic history economic history and the science of economics is and the science of economics is neitherneither aestheticsaesthetics nornor psychology. Alt-psychology. Alt-hough the main principles of economics can’t be described totally inde-hough the main principles of economics can’t be described totally inde-pendentpendent from psychological veins, the science of economics is not ethics from psychological veins, the science of economics is not ethics and the economist is not obliged to confine himself to moral judge-and the economist is not obliged to confine himself to moral judge-ments. Perkin puts forth this respect as a conventional consensus ments. Perkin puts forth this respect as a conventional consensus among the economistsamong the economists..38

economic theory today goes too far and move away from the truth, Neumark insists on

economic theory today goes too far and move away from the truth, Neumark insists on the maintenance of pure economics theory. As the economic policy is a part of state the maintenance of pure economics theory. As the economic policy is a part of state policy,policy, one should notice that a culturally and morally high and strong state cannot be one should notice that a culturally and morally high and strong state cannot be built on a weak economic base. Sarc, first appreciates the book for being the first book built on a weak economic base. Sarc, first appreciates the book for being the first book that systematically analyzes the economic tendencies today and he presents Neu-that systematically analyzes the economic tendencies today and he presents Neu-mark’s bmark’s beliefs. Theneliefs. Then,, criticizes it in the sense that the economic policy has never been criticizes it in the sense that the economic policy has never been directed towards just the economic aims and material welfare even during the golden directed towards just the economic aims and material welfare even during the golden era of liberalism. Therefore, the difference between today and yesterday for Sarc, is not era of liberalism. Therefore, the difference between today and yesterday for Sarc, is not aa difference in essence but a difference in extent. However, Sarc claims that the change difference in essence but a difference in extent. However, Sarc claims that the change in the economic policies of the two countries Neumark principally takes into consider-in the economic policies of the two countries Neumark principally takes into consider-ation that are Germany and Italy, might refer to a difference in essence but he askation that are Germany and Italy, might refer to a difference in essence but he asks s “can we say the same thing for France, Scandinavian countries, Britain a“can we say the same thing for France, Scandinavian countries, Britain andnd America?” America?” More importantly, Sarc raises the question “are we authorized to assume these move-More importantly, Sarc raises the question “are we authorized to assume these move-ments of ideas as the basic outlines of the new born economic regime? Aren’t they ments of ideas as the basic outlines of the new born economic regime? Aren’t they tempotemporary reflections of the current abnormal period of time?” rary reflections of the current abnormal period of time?” Sarc. Review of Sarc. Review of Ekonomi SiyasasınınEkonomi Siyasasının, , 167.167.

34 Suvla, Suvla, Nazari İktisat,Nazari İktisat, 1717..

35 Ibid., 12.Ibid., 12.

36 Baban,Baban, İktisad İlminin,İktisad İlminin, 1212..

37 Perkin, “Ekonomi İlmininPerkin, “Ekonomi İlminin,,”” 5555.. On the other hand, he criticizes Robbins in the sense On the other hand, he criticizes Robbins in the sense that he did not explicitly appreciate the materiality and importhat he did not explicitly appreciate the materiality and importance of the normative tance of the normative economics. economics.

38 Ibid., Ibid., 5555.. Notwithstanding there are some disagreements on the possibility of a Notwithstanding there are some disagreements on the possibility of a normative economic science that tells what should be done.normative economic science that tells what should be done.

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Although this approach reminding ne

Although this approach reminding neoclassicism seems to oclassicism seems to be be adopt-adopt-ed by all the authors referred in this section, the footprints of German ed by all the authors referred in this section, the footprints of German Historical School manifests itself through some expressions. For in-Historical School manifests itself through some expressions. For in-stance, economics is regarded as an empirical science that embraces the stance, economics is regarded as an empirical science that embraces the economic life weconomic life with all its dynamism.ith all its dynamism.39 However,However, inin comprehension of comprehension of the the reality based on observation, what is also hazardous is the embed-reality based on observation, what is also hazardous is the embed-dedness of ideological stance and the viewpoints that determine how dedness of ideological stance and the viewpoints that determine how one perceives the reality. This one perceives the reality. This occurs asoccurs as a central concern for Röpa central concern for Röpke, ke, who asserted that real science must be autonomous if the scientist who asserted that real science must be autonomous if the scientist wants his conscience to remain the highest authority free from the het-wants his conscience to remain the highest authority free from the het-eronomous authorities of secular and spiritual judges in his search for eronomous authorities of secular and spiritual judges in his search for reality.reality.40 He claims that the ideological woHe claims that the ideological words should not be integrated rds should not be integrated into science. According to Röpke, ideology “is a beneficial term that re-into science. According to Röpke, ideology “is a beneficial term that re-veals the pseudologia of the considerations and the words that conceal veals the pseudologia of the considerations and the words that conceal the purpose that doesn’t deserve respectability behind the sententious the purpose that doesn’t deserve respectability behind the sententious phrases. By dphrases. By doing this, it raises doubts visoing this, it raises doubts vis--àà--vis the expressions that vis the expressions that cover the group interests and vulgar political desires.”cover the group interests and vulgar political desires.”41 On the other On the other hand, by saying this, Röpke doesn’t want to deny the reality that each hand, by saying this, Röpke doesn’t want to deny the reality that each scientist would naturally hascientist would naturally haveve a peculiar perspective aa peculiar perspective and value judge-nd value judge-ments but what he wants from himments but what he wants from him/her/her is to be aware of the prescien-is to be aware of the prescien-tific effects and weigh the subjectivity in his own research.tific effects and weigh the subjectivity in his own research.42 Even so, he Even so, he emphasizes that even emphasizes that even behindbehind the purest objectivist theories, it is easy to the purest objectivist theories, it is easy to

39 Neumark,Neumark, Genel Ekonomi Teorisi,Genel Ekonomi Teorisi, 66..

40 Wilhelm Wilhelm Röpke, Röpke, ““KıymetKıymet Hükümleri HaHükümleri Hakkında Bir Kıymet Hükmü,” kkında Bir Kıymet Hükmü,” İÜİFM İÜİFM 3, no. 13, no. 1--2 2 (1942): (1942): 88--10.10. He considers Galile’s “eppur si mouve” principle as the most sublime He considers Galile’s “eppur si mouve” principle as the most sublime expressions of this idea for ever and everexpressions of this idea for ever and ever..

41 Ibid., Ibid., 77.. For a deep analysis on the role of ideology in making science, see For a deep analysis on the role of ideology in making science, see SabriSabri Ülgener, “Bilim, İdeoloji ve Marksizm, Marksist Teori ve Neoklasik İktisatÜlgener, “Bilim, İdeoloji ve Marksizm, Marksist Teori ve Neoklasik İktisat,,”” İÜİFM İÜİFM 36 36 no. 1no. 1--4 (1976).4 (1976).

42 Röpke, Röpke, ““KıymetKıymet,” ,” 99.. Röpke, refers to Mises and tries to reach a common ground Röpke, refers to Mises and tries to reach a common ground between the heteronomous and relativists. It is noteworthy to mention tbetween the heteronomous and relativists. It is noteworthy to mention that Röpke hat Röpke also highlight economics also highlight economics --like other moral scienceslike other moral sciences-- is embedded into the value is embedded into the value judgements. There is a contradiction here in the sense that in many articles of Röpke, judgements. There is a contradiction here in the sense that in many articles of Röpke, morality principle is always excluded from the boundaries of economic science.morality principle is always excluded from the boundaries of economic science.

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discover a hidden value j

discover a hidden value judgement.udgement.43 Besides, he also mentions that Besides, he also mentions that overlooking all of the value judgements would prompt us to an apparent overlooking all of the value judgements would prompt us to an apparent futility.futility.44 The critical point here is, what kind of value judgements can The critical point here is, what kind of value judgements can be considered as legitimate for the science indeed.be considered as legitimate for the science indeed.45 He asserts that oHe asserts that our ur world is a human world, we cannot go beyond this and this is what pro-world is a human world, we cannot go beyond this and this is what pro-vides us the rules and measures.vides us the rules and measures.46 Röpke’s accentuation on this is im-Röpke’s accentuation on this is im-portantportant;; yetyet,, a careful reader of him would have easily noticed the em-a careful reader of him would have easily noticed the em-beddedness of his ideological stance between tbeddedness of his ideological stance between the lines of his writings. he lines of his writings. ItIt can can be even saidbe even said that neither of these authors’ political preferences are that neither of these authors’ political preferences are as apparent as Röpke’s at as apparent as Röpke’s at the the discursive level. His faith discursive level. His faith forfor liberalism liberalism might have seem beyond the framework of an ideology and the ad-might have seem beyond the framework of an ideology and the ad-dressees of thdressees of theseese remarks were probably the dissenters of liberalisremarks were probably the dissenters of liberalismm.. The vigour in his writings in countenance of liberalism and to the det-The vigour in his writings in countenance of liberalism and to the det-riment of opponent ideologies, riment of opponent ideologies, -- in addition to being ain addition to being a theoreticaltheoretical posi-posi-tiontion–– might be explained by might be explained by anan anxiety about a probable shift anxiety about a probable shift to these to these ideologies in that blurred era.ideologies in that blurred era.47

43 Ibid., 11.Ibid., 11.

44 Notwithstanding, he says that if the science neuters itself, a gap would occur and that Notwithstanding, he says that if the science neuters itself, a gap would occur and that gap would be filled out by the demagogues and dilettantes which in turn will result in gap would be filled out by the demagogues and dilettantes which in turn will result in a reaction of politization of the science. Mass populations ara reaction of politization of the science. Mass populations are convinced that the world e convinced that the world is free from meaning and values. However, no one wants to live in world as such. To is free from meaning and values. However, no one wants to live in world as such. To satisfy the eager need for meaning and value, mass people show favor to the doctrines satisfy the eager need for meaning and value, mass people show favor to the doctrines like nationalism, fascism and revolutionary communism. Röpklike nationalism, fascism and revolutionary communism. Röpke, e, ““KıymetKıymet,”,” 1010, cited in , cited in Aldous Huxley, Aldous Huxley, Ends and MeansEnds and Means ((LondonLondon: : 19381938),), 269269..

45 Röpke, Röpke, ““KıymetKıymet,”,” 1313.. The value judgements should be classified in accordance with The value judgements should be classified in accordance with their subjectivity grades, which in other words mean a classification in terms of the their subjectivity grades, which in other words mean a classification in terms of the vital and svital and scientific natures.cientific natures.

46 Ibid.,Ibid., 1818..

47 Röpke’s warnings about the perils of a potential shift from capitalism towards the Röpke’s warnings about the perils of a potential shift from capitalism towards the Soviet system are frequently recognized through his writings.Soviet system are frequently recognized through his writings.

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3.1.2.3 “Political Economy” o“Political Economy” orr “Economics”? Boundaries of the Field of “Economics”? Boundaries of the Field of Economics and EconomistsEconomics and Economists

As previously mentionedpreviously mentioned, the classical school thinkers , the classical school thinkers widelywidely used the used the term “political economyterm “political economy-- economie politique” to defeconomie politique” to define economic phe-ine economic phe-nomena in their age. This tradition continued even during the earlier nomena in their age. This tradition continued even during the earlier periods of periods of the the neoclassical works. However, this naming vanishes away neoclassical works. However, this naming vanishes away as economics gained independence from other disciplines and gradually as economics gained independence from other disciplines and gradually became accepted as a “neutral became accepted as a “neutral science”. science”.

Through the textbooks, the term “economic science” is preferred in-

Through the textbooks, the term “economic science” is preferred in-stead of “political economy”. This is understandable in the sense that stead of “political economy”. This is understandable in the sense that the authors were mostly distanced themselves from the approaches of the authors were mostly distanced themselves from the approaches of the classical school. The independence othe classical school. The independence of “economic science” from the f “economic science” from the moral judgements and politics, also forms a frame for the boundaries of moral judgements and politics, also forms a frame for the boundaries of the field of the economists. There are arguments that deal with what the field of the economists. There are arguments that deal with what economists are expected to do, which isn’t really a matter of debate economists are expected to do, which isn’t really a matter of debate nowadays, at leanowadays, at least as it was then. It seems like an exigency was felt to st as it was then. It seems like an exigency was felt to justify the independence of economics and clarify the boundaries of justify the independence of economics and clarify the boundaries of economist’s role at the period these articles were written. economist’s role at the period these articles were written.

In this respect, Röpke

In this respect, Röpke seems seems as a vigorous advocate of an independ-as a vigorous advocate of an independ-ent ent economic science. The reason why he felt the need to elaborate on economic science. The reason why he felt the need to elaborate on the boundaries of economist’s role was probably related with the the boundaries of economist’s role was probably related with the con-con-textuatextual framework they l framework they experienced a living inexperienced a living in. Röpke asserts that since . Röpke asserts that since the most important problems of politics in those the most important problems of politics in those days were related with days were related with the economic matters, there occurred a hazard for economics to be the economic matters, there occurred a hazard for economics to be closer to politics than science.closer to politics than science.48 For him, economist should not order For him, economist should not order

48 Wilhelm Wilhelm Röpke, Röpke, translated by Bülent Cemil “translated by Bülent Cemil “İktisat İlmi İktisat Siyasİktisat İlmi İktisat Siyasetieti,”,” Journal of Journal of Istanbul University Law Faculty Istanbul University Law Faculty 1, no. 1 (1935):1, no. 1 (1935): 4242--4343.. Röpke argues that tRöpke argues that the displeas-he displeas-ing part is that economists can’t be all things to all men. Some people criticize the ing part is that economists can’t be all things to all men. Some people criticize the economists for the fact that they are not interested enough with poeconomists for the fact that they are not interested enough with politics and some litics and some others get angry when an economist expresses his opinion in economic policies. The others get angry when an economist expresses his opinion in economic policies. The first group would probably feel disappointed when economists make suggestions they first group would probably feel disappointed when economists make suggestions they are somehow opposed to. Similarly, the latter group would be pleased when are somehow opposed to. Similarly, the latter group would be pleased when the econ-the econ-

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

economic policy makers what to do; if he does, he becomes a politician,

economic policy makers what to do; if he does, he becomes a politician, and probably a bad one.and probably a bad one.49

Neumark partly shares Röpke’s view in this respect by claiming that

Neumark partly shares Röpke’s view in this respect by claiming that the science of economics is not incumbent on writing prescriptions to the science of economics is not incumbent on writing prescriptions to the state officials, on the other hand, he mentions that economist should the state officials, on the other hand, he mentions that economist should not stand idle by not stand idle by visvis--àà--visvis some certain fiesome certain fields. The mission of economist lds. The mission of economist is to scrutinize whether the purposes of economic policies can come is to scrutinize whether the purposes of economic policies can come true in the present order or not.true in the present order or not.50 Even so, this responsibility doesn’t go Even so, this responsibility doesn’t go beyond a technocratic approach in conceptualization of the task of beyond a technocratic approach in conceptualization of the task of economist.economist.

Never

Nevertheless, there is a fine line that we should be careful in examin-theless, there is a fine line that we should be careful in examin-ing the views of the authors. They don’t mean that economic theorists ing the views of the authors. They don’t mean that economic theorists should not put forward any idea. On the contrary, Röpke states that if should not put forward any idea. On the contrary, Röpke states that if more attention would have been paid to the economimore attention would have been paid to the economic theorists’ ideas, c theorists’ ideas, humanity would probably be protected from many negative phenomena humanity would probably be protected from many negative phenomena in the last 20 years.in the last 20 years.51 The The crucial crucial point for point for the authorsthe authors is not is not makingmaking

omists’ comments support their wishes.

omists’ comments support their wishes. By saying this, Röpke claims that each group By saying this, Röpke claims that each group consider economists’ role in glorifying their own interests and demands in the field of consider economists’ role in glorifying their own interests and demands in the field of economic policy as ideal. However, according to him, it is better to use adveconomic policy as ideal. However, according to him, it is better to use advertisement ertisement agents for this purpose. By depriving economics of its freedom, one would make the agents for this purpose. By depriving economics of its freedom, one would make the most adverse effect on the national interest. By determining a strict line between most adverse effect on the national interest. By determining a strict line between them, both economics and politics would benefit. Neither economics nor politicsthem, both economics and politics would benefit. Neither economics nor politics should interfere in each other.should interfere in each other. Ibid., 43.Ibid., 43.

49 Ibid., 43. Röpke says that wIbid., 43. Röpke says that while analyzing the possible outcomes of a measure, the hile analyzing the possible outcomes of a measure, the ungrateful mission of the economist is to prove the need for endurance to undesirable ungrateful mission of the economist is to prove the need for endurance to undesirable outcomes. If the economist labels thatoutcomes. If the economist labels that outcome as “undesirable”, he steps on to the outcome as “undesirable”, he steps on to the land of politics.land of politics. Ibid., 45.Ibid., 45. However, he must give a view on some cases like the most However, he must give a view on some cases like the most efficient recruitment of a certain goal efficient recruitment of a certain goal –– like stability of money and agricultural incen-like stability of money and agricultural incen-tivestives –– the diminutions of economic the diminutions of economic policies and detailed analysis of the possible re-policies and detailed analysis of the possible re-sults of a precaution in the field of of economic policy. sults of a precaution in the field of of economic policy. Ibid., 43.Ibid., 43.

50 Neumark, Neumark, Genel Ekonomi TeorisiGenel Ekonomi Teorisi, 6, 6..

51 Röpke,Röpke, ““İktisat İlmi İktisat Siyasetiİktisat İlmi İktisat Siyaseti,” ,” 4343, cited in, cited in E. Cannon, E. Cannon, Bir İktisatçının ProtestosuBir İktisatçının Protestosu, , ((An Economist’s Protest)An Economist’s Protest), , LondLondonon, 1927. Röpke here gives examples from the house , 1927. Röpke here gives examples from the house market in Europe during the war. When the supply demand equilibrium became un-market in Europe during the war. When the supply demand equilibrium became un-balanced, evebalanced, even the implementations of the easiest rules of price mechanism would n the implementations of the easiest rules of price mechanism would give clues about the possible outcomes. Referring to Hayek, Röpke says that the excess give clues about the possible outcomes. Referring to Hayek, Röpke says that the excess

Ş E B N E M G E L M E D İ

concessions from the scientific and neutral viewpoint of economic sci-

concessions from the scientific and neutral viewpoint of economic sci-ence. Theence. They emphasize they emphasize the sharpsharp contrastcontrast between economic science between economic science that examines “what that examines “what isis” and politics’, with its normative question of ” and politics’, with its normative question of “what “what should beshould be”. So, the determination of the boundaries of the role of ”. So, the determination of the boundaries of the role of economist is theorized in accordance with the emphasized amorality of economist is theorized in accordance with the emphasized amorality of the sciethe science.nce.

Although the textbooks

Although the textbooks at largeat large are mainly focused on the neare mainly focused on the needededed freedom of economic theories and economic science from the concerns freedom of economic theories and economic science from the concerns at policy level, Dobretsberger’s at policy level, Dobretsberger’s Ekonomi SiyasetiEkonomi Siyaseti can be counted as an can be counted as an exception. Although he was the successor of Röpexception. Although he was the successor of Röpke, his ideological ke, his ideological stance was very different from him. This book, unlike Röpke’s, seems stance was very different from him. This book, unlike Röpke’s, seems like to be written for determination of a roadmap for the economic poli-like to be written for determination of a roadmap for the economic poli-cy makers. This was not surprising indeed, as Dobretsberger himself cy makers. This was not surprising indeed, as Dobretsberger himself was an activist and in the wwas an activist and in the words of Ahmet Güner Sayar, “he was involved ords of Ahmet Güner Sayar, “he was involved in politics with every fiber of his being”, which makes him different from in politics with every fiber of his being”, which makes him different from his colleagues.his colleagues.52 His book, His book, Ekonomi SiyasetiEkonomi Siyaseti reflects his stance even in reflects his stance even in the foreword of the book in which he entitles economic policy makthe foreword of the book in which he entitles economic policy making ing as a branch of science that aims to explain the related fields in the world as a branch of science that aims to explain the related fields in the world economy.economy.53 His consideration of economic policy as a separate disci-His consideration of economic policy as a separate disci-pline, a branch of sciencepline, a branch of science54 reflects his arguments on the task of eco-reflects his arguments on the task of eco-nomic policy which is expected to go beyonomic policy which is expected to go beyond a confinement to the theo-nd a confinement to the theo-ry.ry.55 Referring to Carl Menger, who was a prominent figure of the Referring to Carl Menger, who was a prominent figure of the Austrian school, Dobretsberger emphasizes that if the question “how it Austrian school, Dobretsberger emphasizes that if the question “how it

state intervention well

state intervention well--intentioned. However, the depression was deepened by this intentioned. However, the depression was deepened by this measure. measure. quotedquoted in in F. A. F. A. Hayek, Hayek, Kiracıyı Himaye MeselesiKiracıyı Himaye Meselesi (Das Mieterschutz Problem), (Das Mieterschutz Problem), Wien, 1929.Wien, 1929.

52 Ahmet Güner Sayar, “DobretsbergerAhmet Güner Sayar, “Dobretsberger Dosyası,Dosyası,”” İstanbul Üniversitesi Siyasal Bilgiler İstanbul Üniversitesi Siyasal Bilgiler Fakültesi Dergisi Fakültesi Dergisi 3636, , (May 2007): 9.(May 2007): 9.

53 Joseph Joseph DobretsbergerDobretsberger, , Ekonomi SiyasetiEkonomi Siyaseti,, translated by Ahmed Haltranslated by Ahmed Halid İlteber (İstanbul: id İlteber (İstanbul: Çeltut Matbaası, 1940), 3.Çeltut Matbaası, 1940), 3.

54 IbidIbid.,., 88..

55 Ibid., 8.Ibid., 8.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

should be” have never been asked, people would have been content with

should be” have never been asked, people would have been content with the first age facilitithe first age facilities.es.56

However, even for him, this doesn’t mean to abandon the scientific

However, even for him, this doesn’t mean to abandon the scientific feature. feature. He argues that tHe argues that to preserve its scientific essence, economic poli-o preserve its scientific essence, economic poli-cy should not be stuck on any ideology. Taking the real factors into con-cy should not be stuck on any ideology. Taking the real factors into con-sideration, it must find a way for refosideration, it must find a way for reforms to be carried out by eliminat-rms to be carried out by eliminat-ing the devious ideas that might be manipulated by the ideologies.ing the devious ideas that might be manipulated by the ideologies.57 In In this sense, economic policy investigates the objective requirements of a this sense, economic policy investigates the objective requirements of a particular period; it is neither a historical appendix nor a part of moral particular period; it is neither a historical appendix nor a part of moral sciescience, but it adjusts itself and its value judgements in accordance with nce, but it adjusts itself and its value judgements in accordance with the changing conditions.the changing conditions.58

The definition part obviously reveals the adopted approaches and

The definition part obviously reveals the adopted approaches and conceptual framework presented in the textbooks are generally associ-conceptual framework presented in the textbooks are generally associ-ated with the analytical tated with the analytical tools of neoclassical economics. Notwithstand-ools of neoclassical economics. Notwithstand-ing, ing, it is important toit is important to highlight that they never take them as they are highlight that they never take them as they are with all respects. In their analysis through their books if not all, they with all respects. In their analysis through their books if not all, they have a critical point of view paying attention the realhave a critical point of view paying attention the real--life condilife conditions. tions. Especially Röpke, who can be characterized as the most liberal minded Especially Röpke, who can be characterized as the most liberal minded among them, always gives examples from the practical reflections while among them, always gives examples from the practical reflections while defensing his theoretical approach. This is crucial in the sense that there defensing his theoretical approach. This is crucial in the sense that there existexists a real effort to persuades a real effort to persuade the readers to the validity of the adopted the readers to the validity of the adopted theoretical preferencetheoretical preference and construct and construct some some organic linkages with the organic linkages with the audience.audience.

56 DobretsbergerDobretsberger,, Ekonomi SiyasetiEkonomi Siyaseti, , 99. . Although Dobretsberger came to Turkey on Although Dobretsberger came to Turkey on Ludwig von Mises’ suggestion, he can’t be described as an absolute representative of Ludwig von Mises’ suggestion, he can’t be described as an absolute representative of the the Austrian Austrian School of thought.School of thought.

57 IbidIbid., ., 1616..

58 IbidIbid.,., 1919..

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§ 3.2 The Methodology DebateThe Methodology Debate

3.2.1 Methodological Divergences Among Different Schools of Methodological Divergences Among Different Schools of ThoughtsThoughts

When we s

When we speak of peak of the method of a disciplinthe method of a discipline, one might think of the e, one might think of the techniques utilized by researchers and practitioners. However, the techniques utilized by researchers and practitioners. However, the problems embraced by the methodology debates go beyond this defini-problems embraced by the methodology debates go beyond this defini-tion. The qualities of economic knowledge, together with how tion. The qualities of economic knowledge, together with how they arethey are achieved and used are some achieved and used are some other matters to be argued within this con-other matters to be argued within this con-text.text.59 Therefore, a detailed analysis of the texts within which we can Therefore, a detailed analysis of the texts within which we can find clues about the approaches of the economists is essential to reveal find clues about the approaches of the economists is essential to reveal their way their way inin acquisition of knowledge. Two prominent methods come to acquisition of knowledge. Two prominent methods come to tthe forefront basically: the deductive and inductive method. The deduc-he forefront basically: the deductive and inductive method. The deduc-tive method assumes that humans behave rationally. This rationality is tive method assumes that humans behave rationally. This rationality is not only applied to reach the highest material advantagenot only applied to reach the highest material advantage,, but also to but also to achieve the highest immaterial interests. Peopachieve the highest immaterial interests. People who act in accordance le who act in accordance with maximization of these net advantages can be regarded as rationally with maximization of these net advantages can be regarded as rationally behaved, and we call those people as behaved, and we call those people as homo economicus. homo economicus. The inductive The inductive economics on the other hand, describes the effective elements in a cer-economics on the other hand, describes the effective elements in a cer-tain space and time atain space and time and examines the applicable fields of the theories nd examines the applicable fields of the theories by finding out which theories reflect the reality and which cannot.by finding out which theories reflect the reality and which cannot.

By the 17

By the 17thth and and the the 1818thth centuries, the spread of scientific knowledge centuries, the spread of scientific knowledge in Britain and France increased the reliance oin Britain and France increased the reliance onn human mind and arouhuman mind and arouse se the idea that humans are rational beings. Mind and ration were so glori-the idea that humans are rational beings. Mind and ration were so glori-fied that they were considered as the main instruments in achieving full fied that they were considered as the main instruments in achieving full and infallible knowledge. The argument of absolute rationality suggest-and infallible knowledge. The argument of absolute rationality suggest-ed that all the source of the reality wed that all the source of the reality was human mind and via human as human mind and via human mind, all the laws of the physical universe and society can be extracted. mind, all the laws of the physical universe and society can be extracted.

59 Buğra, Buğra, İktisatçılar ve İnsanlarİktisatçılar ve İnsanlar, 12, 12..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

Therefore, the hypothesis of the liberal economists of that time we

Therefore, the hypothesis of the liberal economists of that time werere made by the generalizations of the logic and personal senses, within a made by the generalizations of the logic and personal senses, within a deductive waydeductive way. Those hypotheses were acknowledged as valid without . Those hypotheses were acknowledged as valid without proving to what degree they had the explanatory power on the reali-proving to what degree they had the explanatory power on the reali-ties.ties.60 Overconfidence on human mind, came up with the belief system Overconfidence on human mind, came up with the belief system which claimed that the driving force behind human behavior is selfwhich claimed that the driving force behind human behavior is self--iinterest. The Newtonian natural laws influenced not only the positive nterest. The Newtonian natural laws influenced not only the positive but also the social sciences. And the optimal conditions in a society but also the social sciences. And the optimal conditions in a society were expected to arise by itself, via the natural laws.were expected to arise by itself, via the natural laws.61

This approach didn’t remain limited with

This approach didn’t remain limited withinin that century. Thethat century. The meth-meth-odology adopted by the Austrian school and odology adopted by the Austrian school and the the neoclassicals in the late neoclassicals in the late 1919thth century was also rationality based, abstract and deductive. Fur-century was also rationality based, abstract and deductive. Fur-thermore, the use of mathematical expressions became prominent with thermore, the use of mathematical expressions became prominent with the intent of making economics more definithe intent of making economics more definite.te.62 The long 19The long 19thth century century implied the heyday of liberal economic system; so, a compatible theory implied the heyday of liberal economic system; so, a compatible theory with its postulates, namely the static equilibrium analysis was promot-with its postulates, namely the static equilibrium analysis was promot-ed by the neoclassicals with the assurance on a persisting peaceful ed by the neoclassicals with the assurance on a persisting peaceful harmony.harmony.63 NevertheleNevertheless, a reaction against the deductive and rational-ss, a reaction against the deductive and rational-istic method has occurred amid the 19istic method has occurred amid the 19thth century by the historical school. century by the historical school.

60 Kazgan, Kazgan, İktisadi Düşünceİktisadi Düşünce, , 5555--5656..

61 Ibid.,Ibid., 57. In fact, Kazgan mentions that here ideal and virtual conditions were 57. In fact, Kazgan mentions that here ideal and virtual conditions were interlaced. Liberal economists overlooked theinterlaced. Liberal economists overlooked the virtual circumstances due to their firm virtual circumstances due to their firm belief to human rationality. Then examination of the historical and spatial changes in belief to human rationality. Then examination of the historical and spatial changes in the real social world was intentionally or unintentionally disregarded. the real social world was intentionally or unintentionally disregarded.

62 Menger, von Wieser, von Mises and Hayek were mentioMenger, von Wieser, von Mises and Hayek were mentioned as exceptions. Marshall, ned as exceptions. Marshall, although he didn’t exclude mathematics from economics, stressed on the utility pro-although he didn’t exclude mathematics from economics, stressed on the utility pro-vided by mathematics is limited. Kazgan, vided by mathematics is limited. Kazgan, İktisadi Düşünceİktisadi Düşünce,, 118118..

63 Kazgan, Kazgan, İktisadi,İktisadi, 118118. . Neoclassicals also prefer static equilibrium analysis within whichNeoclassicals also prefer static equilibrium analysis within which thethe elapsed time and stages are neglected. From this aspect, it is not suitable for un-elapsed time and stages are neglected. From this aspect, it is not suitable for un-derstanding growth and development issuesderstanding growth and development issues.. Kazgan assKazgan asserts that there is an ideologi-erts that there is an ideologi-cal reason behind the choice of static equilibrium analysis over against the dynamic cal reason behind the choice of static equilibrium analysis over against the dynamic one. Referring to Robinson, she says that the peaceful harmony of the static analysis one. Referring to Robinson, she says that the peaceful harmony of the static analysis promoted the ideology of laissez faire. The deep analyspromoted the ideology of laissez faire. The deep analysis of the theory occupied the is of the theory occupied the agenda of the people that prevented them from verging hazardous ideas against the agenda of the people that prevented them from verging hazardous ideas against the ideology. ideology. Ibid.Ibid.,, 118118..

Ş E B N E M G E L M E D İ

The methodological opposition originated from Germany, as the histori-

The methodological opposition originated from Germany, as the histori-cal works increased in importance there. In fact, it was not thecal works increased in importance there. In fact, it was not the firstfirst--time time history was regarded as a central part of economics,history was regarded as a central part of economics,64 yet the members yet the members of the historical school differed fromof the historical school differed from thethe antecedences by locating histo-antecedences by locating histo-ry at the heart of the analysis of economic processesry at the heart of the analysis of economic processes65 within an induc-within an induc-tive method.tive method.

Among the founders

Among the founders of the German Historical School there were of the German Historical School there were Roscher, Hildebrand and Knies. About the approach of this school, Hil-Roscher, Hildebrand and Knies. About the approach of this school, Hil-debrand assertion that “natural economic laws debrand assertion that “natural economic laws can’t existcan’t exist, , and and and and Knies’ Knies’ argument that “argument that “only some regular repetitions can be found” only some regular repetitions can be found” might provmight provide some insight.ide some insight.66 Although these names were also recog-Although these names were also recog-nizable, the success of the historical school was at its top by the 1870s nizable, the success of the historical school was at its top by the 1870s with the young representative Gustav von Schmoller with a modifica-with the young representative Gustav von Schmoller with a modifica-tion on the viewpoint. Here, the argument that economic laws tion on the viewpoint. Here, the argument that economic laws can’t exist can’t exist was abandoned but the classical method was still considered insuffi-was abandoned but the classical method was still considered insuffi-cient in explaining these laws, since the laws are under the risk of losing cient in explaining these laws, since the laws are under the risk of losing their validity as the conditions change. For this generation of historical their validity as the conditions change. For this generation of historical school, economic theory isschool, economic theory is relative and the economic institutions relative and the economic institutions change in time and space.change in time and space.67 The mastermind of national economy in The mastermind of national economy in Germany, Friedrich List; by explaining the ideas with the historical ex-Germany, Friedrich List; by explaining the ideas with the historical ex-amples and regarding the national community as the center of gravity; amples and regarding the national community as the center of gravity; also approalso appropriated the relativity principle in economics.priated the relativity principle in economics.68 In brief, the In brief, the German Historical German Historical SSchool suggests that each period has its peculiar chool suggests that each period has its peculiar economic laws, so it is hard to fix up theories based on scientific laws, economic laws, so it is hard to fix up theories based on scientific laws,

64 Adam SmithAdam Smith’s’s The Wealth of NationsThe Wealth of Nations and and Karl Marx’s Karl Marx’s Das CapitalDas Capital are among those are among those comprehensive works that include both tcomprehensive works that include both theory and history, Kazgan, heory and history, Kazgan, İktisadiİktisadi, , 184184--185185.. Indeed, some economists even before the historical school pointed out the hazard of Indeed, some economists even before the historical school pointed out the hazard of this method by referring to Sismondi who said “each and every abstraction is deceit” this method by referring to Sismondi who said “each and every abstraction is deceit” Perkin, Perkin, “Ekonomi İlminin,” “Ekonomi İlminin,” 2323. . Saint SimoSaint Simon and Auguste Comte also criticized the ab-n and Auguste Comte also criticized the ab-stractions of the liberal creed freed from time and space. Kazgan,stractions of the liberal creed freed from time and space. Kazgan, İktisadiİktisadi,, 185185..

65 Kazgan,Kazgan, İktisadiİktisadi, , 185185..

66 Ibid., 185.Ibid., 185.

67 Kazgan,Kazgan, İktisadiİktisadi,, 185185--186186..

68 Perkin, Perkin, “Ekonomi İlminin,” “Ekonomi İlminin,” 2424..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

they describe the phenomenon and institutions of the

they describe the phenomenon and institutions of the past and present past and present based on statistical data. At this point, the theory is obscure.based on statistical data. At this point, the theory is obscure.69

In the 19

In the 19thth century, the methodology debate was dealing with how century, the methodology debate was dealing with how the economic examinations should be conducted. Although the method-the economic examinations should be conducted. Although the method-ological differences were notably on the ological differences were notably on the agenda particularly by the agenda particularly by the emergence of marginalism in the late 19emergence of marginalism in the late 19th th century,century, Ayşe Buğra claims Ayşe Buğra claims that the methodology debate revived in the 1930s.that the methodology debate revived in the 1930s.70 Influenced by the Influenced by the historical school, the institutionalists in the US occurred as the main historical school, the institutionalists in the US occurred as the main subjects of the debsubjects of the debates. Veblen, Galbraith, Mitchell, Swedish Gunnar ates. Veblen, Galbraith, Mitchell, Swedish Gunnar Myrdal and French François Perroux were among the prominent figures Myrdal and French François Perroux were among the prominent figures who were mostly in demand after the Great Depression. Instead of es-who were mostly in demand after the Great Depression. Instead of es-tablishing systematic theories; they scrutinized the traditions, behav-tablishing systematic theories; they scrutinized the traditions, behav-iiors and institutions. Although disfavored in the 1940s and ors and institutions. Although disfavored in the 1940s and the the 1950s, 1950s,

69 Ibid., 24. Ibid., 24. It is inIt is interesting that Carl Menger, a professor in teresting that Carl Menger, a professor in the the University of Vienna, University of Vienna, published a book in 1883 that defends deduction and abstraction methods during the published a book in 1883 that defends deduction and abstraction methods during the time the historical school developed. In another book of him, Menger claimed that the time the historical school developed. In another book of him, Menger claimed that the historicists attemhistoricists attempt to impose their methods pt to impose their methods ––like the invaders of a foreign landlike the invaders of a foreign land--.and .and they showed intolerance to opposing methods.they showed intolerance to opposing methods. Perkin,Perkin, “Ekonomi İlminin,” “Ekonomi İlminin,” 2525.. cited cited from,from, Menger,Menger, Die İrrthümeri der Historismus in der Deutschen National ÖkonomieDie İrrthümeri der Historismus in der Deutschen National Ökonomie, 6. , 6. Röpke also refers to Pantaleoni by claiming that when the suppliers and demanders Röpke also refers to Pantaleoni by claiming that when the suppliers and demanders encounter each other in a market, the implementation of econencounter each other in a market, the implementation of economic theories that are omic theories that are valid in every time and place is required. In this sense, there is no British, German, valid in every time and place is required. In this sense, there is no British, German, French or Turkish economics, there is one universal notable economics and its method French or Turkish economics, there is one universal notable economics and its method is the same in everywhere. As Pantaleoni asserted while his ois the same in everywhere. As Pantaleoni asserted while his opening lecture in Lau-pening lecture in Lau-sanne: “Il n’ya que deux ecoles (en economie politique). L’ecole de ceux qui connaisent sanne: “Il n’ya que deux ecoles (en economie politique). L’ecole de ceux qui connaisent l’el’ecoconomie politique et l’ecole de ceux qui ne la connaissent pas. Ces deux ecoles se nomie politique et l’ecole de ceux qui ne la connaissent pas. Ces deux ecoles se font naturallement toujours la guerre” font naturallement toujours la guerre” Röpke, “İktisat İlmi,” 44; Röpke, “İktisat İlmi,” 44; Perkin,Perkin, “Ekonomi İl-“Ekonomi İl-minin,” minin,” 2525, quoted in , quoted in M. Pantaleoni, M. Pantaleoni, Du caractere logique des diferences d’opinion qui Du caractere logique des diferences d’opinion qui separent les economistesseparent les economistes, Geneve, 1897., Geneve, 1897.

70 Buğra, Buğra, İktisatçılar ve İnsanlar,İktisatçılar ve İnsanlar, 181.181. It is meaningful to assess the similar apIt is meaningful to assess the similar approaches proaches that are the reflections of the political concerns originated from similar political envi-that are the reflections of the political concerns originated from similar political envi-ronments from the standpoint of economists’ ways on acquisition of knowledge about ronments from the standpoint of economists’ ways on acquisition of knowledge about the society and as a result, influencing it.the society and as a result, influencing it.

Ş E B N E M G E L M E D İ

their views revived in between

their views revived in between thethe 1960s and 1975, and become popu-1960s and 1975, and become popu-lar again after the end of the Cold War.lar again after the end of the Cold War.71

TThe methodology debate between the Austrians and German His-he methodology debate between the Austrians and German His-torical Schtorical School in the 19ool in the 19thth century century was mentioned was mentioned as well as the revival of as well as the revival of the debate in the 1930s. Yet, the need for a methodology debate itself the debate in the 1930s. Yet, the need for a methodology debate itself has also has also becbecoome a matter of debate. For instance, Pareto argueme a matter of debate. For instance, Pareto arguedd that that methodology debate is unnecessary and useless becausmethodology debate is unnecessary and useless because the goal of the e the goal of the science is to discover the uniformities of the facts.science is to discover the uniformities of the facts.72 Pigou also fPigou also foundound it it useless, for him, such an unnecessary debate prevents the ones who useless, for him, such an unnecessary debate prevents the ones who investigate for the reality to reach their goals.investigate for the reality to reach their goals.73 Robbins, while not con-Robbins, while not con-sidering it meaninglessidering it meaningless, says that it was meaningful during the founda-s, says that it was meaningful during the founda-tion of economics in the 19tion of economics in the 19thth century, but not in the current times.century, but not in the current times.74 Nevertheless, the methodology debate lies at the heart of the historical Nevertheless, the methodology debate lies at the heart of the historical evolution of the science of economics over the years and the nextevolution of the science of economics over the years and the next sec-sec-tion will elaborate on which method tion will elaborate on which method was most embracedwas most embraced among the among the local local academics.academics.

3.2.2 Methodological Preferences in TurkeyMethodological Preferences in Turkey

The methodology debates are somehow connected with the German

The methodology debates are somehow connected with the German Historical School as far as they take place through the articles of Historical School as far as they take place through the articles of the the university textbooks and journals. First, it is investigated whether university textbooks and journals. First, it is investigated whether

71 Kazgan, Kazgan, İktisadi Düşünce, İktisadi Düşünce, 187187--188188. . This might be related with the absence of This might be related with the absence of institutional regulatories in the mentioned era. The existing theories remained inca-institutional regulatories in the mentioned era. The existing theories remained inca-pable in solving the problems of the Great Depression. The US was the country to pable in solving the problems of the Great Depression. The US was the country to claim the responsibility in the World afclaim the responsibility in the World after the WWI, but it was not on the stage as ter the WWI, but it was not on the stage as much as expected then.much as expected then.

72 Perkin, Perkin, “Ekonomi İlminin,” 26, cited in“Ekonomi İlminin,” 26, cited in V. Pareto, V. Pareto, Manuel d’Economie PolitiqueManuel d’Economie Politique 2.ed2.ed Paris Paris ((19271927:: 2626).).

73 Ibid., 26, cited in A. C. Pigou, Ibid., 26, cited in A. C. Pigou, Economie Essays and Adresses, Economie Essays and Adresses, 1.1.

74 Ibid., 26, cited in L. Robbins “Live and Dead Issues on the Methodology of Economics,” Ibid., 26, cited in L. Robbins “Live and Dead Issues on the Methodology of Economics,” EEconomica, conomica, (1938).(1938).

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

dwelling upon the methodological issues are

dwelling upon the methodological issues are reallyreally that that essentialessential for for economics or not. Alexander Rüstow, who wrote an article on the gen-economics or not. Alexander Rüstow, who wrote an article on the gen-eral principles of economic science, surprisineral principles of economic science, surprisingly wanders from the gly wanders from the German Historical School by asserting that being overwhelmed by the German Historical School by asserting that being overwhelmed by the methodological issues without embarking on the content has been a methodological issues without embarking on the content has been a chronical illness in German science particularly since Kant.chronical illness in German science particularly since Kant.75 In broad In broad terms, what is considered as sterms, what is considered as significant for him, is not how the research ignificant for him, is not how the research should be done, but fixing the scientific and logical values as the center should be done, but fixing the scientific and logical values as the center of gravity in all the branches of economics.of gravity in all the branches of economics.76

Although there are many opposing ideas, methodology debate was

Although there are many opposing ideas, methodology debate was still perceived as significastill perceived as significant in determination of the fields and certain nt in determination of the fields and certain branches of economics in the current era.branches of economics in the current era.77 Through the works of the Through the works of the academics related with the appropriate methodology for economics, it academics related with the appropriate methodology for economics, it can be easily seen that there can be easily seen that there wawas not a blind faith to any of them. One s not a blind faith to any of them. One mmight expect that the influence of German Historical School would have ight expect that the influence of German Historical School would have dominated the methodology but the German dominated the methodology but the German émigréémigré economists can’t be economists can’t be defined as vigorous advocates of inductive methods indeed, as it defined as vigorous advocates of inductive methods indeed, as it can can clearly clearly be be seen seen inin Rüstow’s viewpoint. The generaRüstow’s viewpoint. The general approach of the au-l approach of the au-thors is best represented by Alfred Marshall’s and Schmoller’s sentenc-thors is best represented by Alfred Marshall’s and Schmoller’s sentenc-ing that “just as the left and right feet are both necessary to walk, both ing that “just as the left and right feet are both necessary to walk, both induction and deduction are essential for the science.”induction and deduction are essential for the science.”78

The theoretical economics is given its due since there certainly is a uni-ty in its method; however, it is also mentioned that in consideration of the frame and relations of economics with other sciences, this deductive method should not be regarded as the only part of economic knowledge that can be labeled as scientific. The deductive economics is criticized

75 Alexander Alexander Rüstow, “İktisat İlminin EsaslarıRüstow, “İktisat İlminin Esasları,,”” İÜİFM İÜİFM 2, (1940): 2, (1940): 177177.. Rüstow mainly Rüstow mainly acknowledged the approach of Eucken who was a professor in Freiburg and is consid-acknowledged the approach of Eucken who was a professor in Freiburg and is consid-ered as the founding figure of ordoliberal thought. ered as the founding figure of ordoliberal thought. Eucken’sEucken’s book book İktisİktisadın Esaslarıadın Esasları for for Rüstow turns over a new leaf in economics, Rüstow turns over a new leaf in economics, Ibid., Ibid., 158.158.

76 Perkin, Perkin, “Ekonomi İlminin,” “Ekonomi İlminin,” 2626..

77 Ibid., Ibid., 5353..

78 Ibid., Ibid., 2525..

Ş E B N E M G E L M E D İ

by Perkin for the insufficiency of its techniques in exploring the evolu-tion and making expectations for the long term; as it is not possible to figure out a theory of evolution via those deductive methods.79 The uni-ty in the structure of the deductive theory –which is nonexistent in in-ductive methods- wasn’t considered as a proof of a superiority of the deductive methods for him. He acknowledges that the results of the theory are almost definite due to its limited framework; but it is not concerned with comprising each field of the reality. The inductive method is deemed important as it can reveal some fields that the theory cannot comprehend.80 He considers that the science of economics -which is concerned with the reality- has various facades; and it is com-posed of many different sciences and they all have their peculiar logical unity.81

Although each method is remunerated for the benefits they gener-ate, the deductive method is mostly adopted in Şükrü Baban’s textbook, as maximization of interest is confirmed as an intrinsic rule of human nature and the belief that people mostly behave consistent is affirmed by him. He agrees on that there might be individual deviations; yet, for him, it is very probable that humans interact similarly under certain conditions because people are mostly subject to these virtues. Hence, these assumptions should be regarded as universal realities.82 Though taking the side of deductive methods, Baban also mentions that the in-ductive and deductive methods are not contrary to each other. For him, the assistance of induction and experience cannot be disregarded in creation of economic laws.83 Refii Şükrü Suvla in his textbook also re-munerates the deductive method but criticizes it in the sense that the method is based on perfect competition conditions which is in fact an unsubstantial situation. Even so, some aspects like price mechanism

79 Perkin,Perkin, “Ekonomi İlminin,” 56.“Ekonomi İlminin,” 56.

80 Ibid., Ibid., 5757..

81 Ibid.,Ibid., 5656..

82 Baban, Baban, İktisad İlminin, İktisad İlminin, 1414..

83 Baban, Baban, İktisad İİktisad İlmininlminin, , 1414..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

and value theories, are presented to be more reliant on the deductive method for him.84

Baban grounds his arguments on the assertion that

Baban grounds his arguments on the assertion that,, for economics for economics to be assumed as to be assumed as a a science, constant relations should exist in economic science, constant relations should exist in economic behaviors and these behaviors would sbehaviors and these behaviors would show similar tendencies how similar tendencies --ceteris ceteris paribusparibus-- as well as being predictable. Certain results are expected to as well as being predictable. Certain results are expected to come up by objective conditions. So that laws can exist and this is the come up by objective conditions. So that laws can exist and this is the only way to do science.only way to do science.85 The divergences between the reality and mod-The divergences between the reality and mod-el shouldn’t el shouldn’t unsettle the reliance on laws for them. Keeping in mind that unsettle the reliance on laws for them. Keeping in mind that it is practically impossible to generate laws for the various appearance it is practically impossible to generate laws for the various appearance of the reality, what the scientific knowledge is expected to provide us is of the reality, what the scientific knowledge is expected to provide us is mentioned as mentioned as predictability. Contrary to the popredictability. Contrary to the positive sciences, the num-sitive sciences, the num-ber of the conditions to be fixed is much more for social sciences as they ber of the conditions to be fixed is much more for social sciences as they are permanently changing. Yetare permanently changing. Yet,, even in such a case even in such a case argues argues Suvla, it is not Suvla, it is not reasonable to blame the laws for this; reasonable to blame the laws for this; ““laws don’t change, conditions laws don’t change, conditions changechange””..86

A related question might be related question might be raised raised about whether one can formulate about whether one can formulate laws via inductive methods as it can easily be done in deductive meth-laws via inductive methods as it can easily be done in deductive meth-ods. Baban asserts that with the help of the inductive method, we can ods. Baban asserts that with the help of the inductive method, we can see the tendencies based on experience. However, forsee the tendencies based on experience. However, for this method to be this method to be useful in formulating laws, many observations are needed and as we useful in formulating laws, many observations are needed and as we know that know that ceteris paribusceteris paribus is not realistic is not realistic -- the economic phenomena are the economic phenomena are so complicated and embeddedso complicated and embedded-- it is very hard to make laws based on it is very hard to make laws based on observations.observations.87 This view is parThis view is parallel with Alfred Marshall’s words: “his-allel with Alfred Marshall’s words: “his-tory portrays the array of events but is incapable of establishing causal tory portrays the array of events but is incapable of establishing causal relations.”relations.”88

84 Suvla, Suvla, Nazari İktisatNazari İktisat, , 326326..

85 Baban,Baban, İktisad,İktisad, 8. The textbooks by Röpke, Neumark and Suvla also share this 8. The textbooks by Röpke, Neumark and Suvla also share this viewpointviewpoint..

86 Suvla, Suvla, NazariNazari, , 44--77..

87 Baban, Baban, İktisadİktisad, , 1010--1111..

88 Victor Rouquet La Garrigue, “İktisat Nazariyelerinin Meydana GelmVictor Rouquet La Garrigue, “İktisat Nazariyelerinin Meydana Gelmesinde Tarihin esinde Tarihin RolüRolü,,” ” İÜİFM İÜİFM 12,12, no: 1no: 1--2 (1950): 872 (1950): 87..

Ş E B N E M G E L M E D İ

Both the Germans and Turkish authors tend to embark more upon

Both the Germans and Turkish authors tend to embark more upon the deductive methods, while an impressive defense came from a the deductive methods, while an impressive defense came from a FrenFrench author, professor Rouquet La Garrigue, from the lawch author, professor Rouquet La Garrigue, from the law facultyfaculty in in Bordeaux University who also taught in Istanbul University. He put for-Bordeaux University who also taught in Istanbul University. He put for-ward an opposition to the ones underestimating or denying the role of ward an opposition to the ones underestimating or denying the role of history in origination of theories by asserting thhistory in origination of theories by asserting that a switch to an ex-at a switch to an ex-planatory history is planatory history is essential.essential.89 Referring to Carl Menger’s wordsReferring to Carl Menger’s words::

By understanding the individual occurrence of an incident by y understanding the individual occurrence of an incident by embodying the individual conditions, we can comprehend it his-embodying the individual conditions, we can comprehend it his-torically. But when we think of that individualtorically. But when we think of that individual event as a special event as a special circumstance of an order emerged as a simultaneous course of circumstance of an order emerged as a simultaneous course of events, we can arrive at a theoretical explanationevents, we can arrive at a theoretical explanation..90

he su

he suggests that what will lead us to achieve the greatest synthesis of ggests that what will lead us to achieve the greatest synthesis of the modern dynamics are the theories that are basethe modern dynamics are the theories that are based on history. Sod on history. So,, for for him, we are absolutely in need of the means that are provided via histo-him, we are absolutely in need of the means that are provided via histo-

89 Garrigue says that wGarrigue says that when we take the mercantilists at hand for instance, we see that hen we take the mercantilists at hand for instance, we see that they look at the economic conditions and look for political solutions by interpreting they look at the economic conditions and look for political solutions by interpreting them. Economics at those timethem. Economics at those times represented the desires of s represented the desires of thatthat era. Theory was era. Theory was emerged as the generalization of remarks based on individual events, which loosens emerged as the generalization of remarks based on individual events, which loosens its ties with reality. its ties with reality. HeHe also examines the role of history in formation of also examines the role of history in formation of the the theories of theories of the the classical school and physioclassical school and physiocratscrats and claims that aand claims that all thell thesese theories refertheories refer thethe zeit-zeit-geist. Considering it as an unchanging natural order geist. Considering it as an unchanging natural order ––as physiocrats think of their as physiocrats think of their theoriestheories-- is wrongis wrong for himfor him. . ““One has to keep in mind that they found their theories on One has to keep in mind that they found their theories on the context of 1750’s France.the context of 1750’s France.”” He continues by asserting that the cHe continues by asserting that the classical theory lassical theory waswas also composed in accordance with that time’s conditions of production and relations also composed in accordance with that time’s conditions of production and relations of distribution. Sismondi, Ricardo, Smith were all inspired by the observation of reali-of distribution. Sismondi, Ricardo, Smith were all inspired by the observation of reali-ty. Sismondi for example witty. Sismondi for example witnessnesseded the rejection of the conceptions of his professor the rejection of the conceptions of his professor Adam Smith by the course of events. Say’s law of markets was refuted by the historical Adam Smith by the course of events. Say’s law of markets was refuted by the historical observations. Garrigue says that we can’t talk about the adaptation mechanisms in observations. Garrigue says that we can’t talk about the adaptation mechanisms in abstract sense; above all, we abstract sense; above all, we must conceive the agony of people during the adaptation must conceive the agony of people during the adaptation process. Besides the importance of social reality that is given credit by many like Sis-process. Besides the importance of social reality that is given credit by many like Sis-mondi, we see that such a turnover has taken place in Germany by turning back to the mondi, we see that such a turnover has taken place in Germany by turning back to the national reality via the leanational reality via the lead of Friedrich List. d of Friedrich List. Ibid.,Ibid., 8888--9393..

90 Ibid.,Ibid., 8787--8888..

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

ry. He argues that theory has a scientific goal, it is universal

ry. He argues that theory has a scientific goal, it is universal91 and some-and some-how free from temporal and spatial considerations. There is nothing how free from temporal and spatial considerations. There is nothing surprising in this arsurprising in this argument except the universality hypothesis; but Gar-gument except the universality hypothesis; but Gar-rigue courageously continues by saying that each theory rigue courageously continues by saying that each theory --no matter how no matter how scientific it isscientific it is--, is ultimately made up of a defense of a stance. History, by , is ultimately made up of a defense of a stance. History, by supplying information and providing the most crucial matsupplying information and providing the most crucial material of every erial of every systematic structure, is portrayed as the most needed field by the eco-systematic structure, is portrayed as the most needed field by the eco-nomic researchers. In this way, claims Garrigue, the historical time nomic researchers. In this way, claims Garrigue, the historical time would be present within the course theory which is comprised of un-would be present within the course theory which is comprised of un-conscious and empirical vision of woconscious and empirical vision of world; and the historical elements rld; and the historical elements gradually become the base of theory, which economists will scientifical-gradually become the base of theory, which economists will scientifical-ly benefit from.ly benefit from.92

The authors meet on a common ground that the task of economic

The authors meet on a common ground that the task of economic science is to examine science is to examine the the economic facts andeconomic facts and toto present the constant present the constant relrelationsations between them, namely the economic laws. The role of the the-between them, namely the economic laws. The role of the the-oretical models is to promise predictability.oretical models is to promise predictability.93 But as there are many But as there are many conditions to be fixed to see the effectiveness of the economic laws, the conditions to be fixed to see the effectiveness of the economic laws, the laws are not to blame laws are not to blame during during when conditions vawhen conditions vary.ry.94 The emphasis on The emphasis on

91 Ibid., 88.Ibid., 88. In fact, the universality has always been a matter of debate. In the Gulbenkian In fact, the universality has always been a matter of debate. In the Gulbenkian Commission’s Report it is questioned: “how can the social sciences deal with the fact Commission’s Report it is questioned: “how can the social sciences deal with the fact that they must describthat they must describe, formulate true statements about an unequal world in which e, formulate true statements about an unequal world in which the social scientists themselves are rooted? The claims of universalism have always the social scientists themselves are rooted? The claims of universalism have always been claims made by particular persons”. Wallerstein et al, been claims made by particular persons”. Wallerstein et al, Open the Social SciencesOpen the Social Sciences, , 5858..

92 Garrigue, Garrigue, “İktisa“İktisat Nazariyelerinint Nazariyelerinin,”,” 89. A similar comment can be found in the 89. A similar comment can be found in the Gulbenkian Commission Report, namely Gulbenkian Commission Report, namely Open the Social SciencesOpen the Social Sciences years after. In the years after. In the report, it is alleged that “scientific truth is itself historical. The issue therefore is not report, it is alleged that “scientific truth is itself historical. The issue therefore is not simply what is unisimply what is universal but what is evolving, and whether that which is evolving is versal but what is evolving, and whether that which is evolving is necessarily identifiable with progressnecessarily identifiable with progress””. Wallerstein et al. . Wallerstein et al. Open the Social SciencesOpen the Social Sciences, 58, 58..

93 Suvla, Suvla, Nazari, Nazari, 77; ; Baban,Baban, İktisad, İktisad, 88..

94 Suvla likens economic theory to a map and economic acSuvla likens economic theory to a map and economic action to a countrytion to a country presented in presented in that mapthat map.. He says thatHe says that jjust as it is impossible to travel without map, it is impossible to ust as it is impossible to travel without map, it is impossible to solve the economic phenomenon and take measures for the future without theory. A solve the economic phenomenon and take measures for the future without theory. A map map doesn’t showdoesn’t show (and doesn’t have to show) (and doesn’t have to show) every detevery detail in the country ail in the country in order in order to beto be considered asconsidered as useful. As we can’t blame the map when we mired on the way, we can’t useful. As we can’t blame the map when we mired on the way, we can’t

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laws and theory, the efforts to achieve consistency and the internalized

laws and theory, the efforts to achieve consistency and the internalized rationality assumption rationality assumption can all be considered ascan all be considered as the reflections of ththe reflections of the e fact thatfact that the gravity center liesthe gravity center lies much more onmuch more on the deductive method the deductive method than than the inductive one.the inductive one.

§ 3.3 Theories on Value and PriceTheories on Value and Price

3.3.1 Conceptions on Value and PriceConceptions on Value and Price

“The concept of value is defined as one of the metaphysical concepts in “The concept of value is defined as one of the metaphysical concepts in economics.” claimed Joan Robinson, “value is not a utility provided by economics.” claimed Joan Robinson, “value is not a utility provided by the goods, nor a historical average of the actuthe goods, nor a historical average of the actual prices. This is not just a al prices. This is not just a price indeed, it is something that explains the formation of prices.”price indeed, it is something that explains the formation of prices.”95

In the abovementioned quotation, Robinson emphasizes the compli-

In the abovementioned quotation, Robinson emphasizes the compli-cated nature of value. So indeed, different schools of thought have dif-cated nature of value. So indeed, different schools of thought have dif-fering views on this fering views on this concept. In the classical school of thought, value is concept. In the classical school of thought, value is divided into two: use value and exchange value. Use value refers to utili-divided into two: use value and exchange value. Use value refers to utili-ty and exchange value refers to price.ty and exchange value refers to price.96 While acknowledging the use While acknowledging the use value, what they were really interested in is the exchange vavalue, what they were really interested in is the exchange valuelue97, the , the long run equilibrium prices and the production side within which labor long run equilibrium prices and the production side within which labor is at the forefront. For the classical thinkers, the goods are exchanged in is at the forefront. For the classical thinkers, the goods are exchanged in

blame the theory in the face of a problem that doesn’t fit into the theory.

blame the theory in the face of a problem that doesn’t fit into the theory. Suvla, Suvla, Nazari, Nazari, 1111..

95 Kazgan, Kazgan, İktisadi Düşünceİktisadi Düşünce, 403, q, 403, quoted in Joan Robinson, 29.uoted in Joan Robinson, 29. Robinson’s definition is Robinson’s definition is mentioned at the first place for it represents the complexity in defining this concept.mentioned at the first place for it represents the complexity in defining this concept.

96 Ibid., Ibid., 7373.. The combination of use value with exchange value is applied by the The combination of use value with exchange value is applied by the neoclassineoclassical schoolcal school..

97 Ibid., 73Ibid., 73--74. 74. Although he was a classical school thinker, John Baptiste Say was a Although he was a classical school thinker, John Baptiste Say was a pioneer for neoclassical economists including the utility and opportunity cost theory.pioneer for neoclassical economists including the utility and opportunity cost theory. Ibid., 78.Ibid., 78.

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accordance with the labor they contain,

accordance with the labor they contain,98 as costs should be based upon as costs should be based upon labor.labor.99 This approach is intThis approach is introduced by William Pettyroduced by William Petty100 and continued and continued by Smith, Ricardoby Smith, Ricardo101 and Marx.and Marx.102. Their theory on value is named as the . Their theory on value is named as the “objectivist value theory” in which utility doesn’t emerge as a cause of “objectivist value theory” in which utility doesn’t emerge as a cause of value but merely a condition for it. value but merely a condition for it.

The subjectivist value theory on the

The subjectivist value theory on the other hand, asserts that what other hand, asserts that what generate utility and value are the needs. In fact, this approach is older generate utility and value are the needs. In fact, this approach is older than the objectivist theory as it dates back to Aristo. In the 19than the objectivist theory as it dates back to Aristo. In the 19thth century, century, the Austrian School (Menger, Wieser) and Jevons, Marshall, Clark are to the Austrian School (Menger, Wieser) and Jevons, Marshall, Clark are to bebe counted as the proponents of the theory of marginal value. According counted as the proponents of the theory of marginal value. According to this theory, the structure of needs varies from person to person and to this theory, the structure of needs varies from person to person and value is based on the relations between our needs and the goods.value is based on the relations between our needs and the goods.103

Various viewpoints were also available on

Various viewpoints were also available on the the dedeterminterminants ofants of pric-pric-ees.s. Some suggests that price is the representation of exchange value.Some suggests that price is the representation of exchange value.104 Some concludes with the ideas that value and price are the same when Some concludes with the ideas that value and price are the same when represented with money.represented with money.105 For Ricardo, there is the notion of “natural For Ricardo, there is the notion of “natural

98 Smith is said to be an exception as he based the total cSmith is said to be an exception as he based the total cost on the costs of land, capital ost on the costs of land, capital and laborand labor. Ibid., 75. Ibid., 75--76.76.

99 Suvla, Suvla, Nazari, Nazari, 158158.. Capital is considered as crystallized labor, but land doesn’t create Capital is considered as crystallized labor, but land doesn’t create any value for Ricardo.any value for Ricardo.

100 Suvla mentions the name of Adam Smith instead of PettySuvla mentions the name of Adam Smith instead of Petty.. Ibid., Ibid., 157157..

101 Kazgan,Kazgan, İktisadi, İktisadi, 7878.. Labor is the first and basic source of value for Ricardo. Here, labor Labor is the first and basic source of value for Ricardo. Here, labor not only refers to the current labor but also the labor in the past, which became con-not only refers to the current labor but also the labor in the past, which became con-crete on the means of production. The equipment used for production represents the crete on the means of production. The equipment used for production represents the accaccumulated labor.umulated labor.

102 Neumark, Neumark, Umumi İktisat Teorisi v2.Umumi İktisat Teorisi v2. 11stst fascicule Kıymet ve Fiyat Nazariyeleri fascicule Kıymet ve Fiyat Nazariyeleri (İstanbul, (İstanbul, 1940), 1940), 1515.. Suvla adds the names of Rodbertus, Lasalle and John Stuart Mill. There is Suvla adds the names of Rodbertus, Lasalle and John Stuart Mill. There is also a question on whether a good has an exchange value withoutalso a question on whether a good has an exchange value without being effectively being effectively exchanged or not. Neumark says that the earlier conceptualizations on this question exchanged or not. Neumark says that the earlier conceptualizations on this question can be found in the classical school, especially in Marx. can be found in the classical school, especially in Marx.

103 Neumark, Neumark, Umumi İktisat 2, Umumi İktisat 2, 21, cited 21, cited inin MengerMenger, , 108108..

104 Neumark, Neumark, Kıymet ve Fiyat, Kıymet ve Fiyat, 1010.. Some rSome representatives of this viewpoint are mentioned epresentatives of this viewpoint are mentioned as as PhilippovichPhilippovich andand BöhmBöhm--BawerkBawerk..

105 Ibid., Ibid., 1111.. Some representatives of this viewpoint are mentioned as Some representatives of this viewpoint are mentioned as BaudinBaudin and and TaussigTaussig..

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price”, and in the long run

price”, and in the long run the market price evolves into natural price.the market price evolves into natural price.106 In the neoclassical system, price is determined at the intersection of In the neoclassical system, price is determined at the intersection of supply and demand curves in a free market economy. During the 1930s, supply and demand curves in a free market economy. During the 1930s, Oskar Lange, came up with a different price system that combined clas-Oskar Lange, came up with a different price system that combined clas-ssical approach with the neoclassical.ical approach with the neoclassical.107 Indeed, price formation is de-Indeed, price formation is de-pendent upon the differing conditional framework, under the assump-pendent upon the differing conditional framework, under the assump-tions of perfect competition and monopolies. In the following section,tions of perfect competition and monopolies. In the following section, which conceptualizations on value and price which conceptualizations on value and price wewere morre more acknowledgede acknowledged will be revealed.will be revealed.

3.3.2 Evaluations on Value and Price Theories in TurkeyEvaluations on Value and Price Theories in Turkey

The debates on the meaning of value and the price theory ha

The debates on the meaning of value and the price theory haveve always always lied at the center of the theory making process. These two concepts are lied at the center of the theory making process. These two concepts are explained at great length inexplained at great length in the textbooks of Neumark, Suvla, Röpke and the textbooks of Neumark, Suvla, Röpke and Baban. Presentation of various conceptualizations on value and the de-Baban. Presentation of various conceptualizations on value and the de-bates on whether it should be regarded as an individual concept or con-bates on whether it should be regarded as an individual concept or con-sidered as an extension of the price theory constitute the main body of sidered as an extension of the price theory constitute the main body of tthe texts devoted to this issue.he texts devoted to this issue.

Neumark allocates a fascicule namely “Mechanism and Dynamics of

Neumark allocates a fascicule namely “Mechanism and Dynamics of Economics” in his book, through which he presents Economics” in his book, through which he presents the the value and price value and price theories. He begins with the concept of value and analyzes the ambigu-theories. He begins with the concept of value and analyzes the ambigu-ous character of it. ous character of it. Focusing on the inquisition whether such a concept Focusing on the inquisition whether such a concept is essential or not via explaining the objectivist and subjectivist value is essential or not via explaining the objectivist and subjectivist value theoriestheories108, he puts forward his own approach afterwards. Value is a , he puts forward his own approach afterwards. Value is a metaphysical concept for Neumark, hence it is not considered suimetaphysical concept for Neumark, hence it is not considered suitable table

106 Ibid.,Ibid., 1616--1717.. They don’t take the temporary flows of market in case of emergencThey don’t take the temporary flows of market in case of emergencies.ies.

107 Maurice Dobb, Maurice Dobb, “Ekonomi Nazariyesinin Sosyalist Ekonomiye Tatbikine Dair “Ekonomi Nazariyesinin Sosyalist Ekonomiye Tatbikine Dair Münakaşanın TenkitiMünakaşanın Tenkiti,,”” İÜİFM İÜİFM 22, , (1940): 207.(1940): 207.

108 The The emphasis was generally rested on Ricardo’s, Marx’s and marginalists’ viewpoints.emphasis was generally rested on Ricardo’s, Marx’s and marginalists’ viewpoints.

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for economic analysis.

for economic analysis.109 Baban also seems suspicious about the mean-Baban also seems suspicious about the mean-ing of the concept which he says was existent since the Greek philoso-ing of the concept which he says was existent since the Greek philoso-phers even before the science of economics was born. He also adds that phers even before the science of economics was born. He also adds that it is hard to arrive at a consensus on valueit is hard to arrive at a consensus on value because it constitutes the because it constitutes the basic facts in economics which engendered many doctrinal differences basic facts in economics which engendered many doctrinal differences among those who tramong those who tryy to explain it.to explain it.110 Some thinkers suggested that we Some thinkers suggested that we can understand value via utility and some others highlight the problem can understand value via utility and some others highlight the problem of scarcity. The argof scarcity. The arguments about the fair value and fair price refer to the uments about the fair value and fair price refer to the judgements on the fairness of the actual values and prices in terms of judgements on the fairness of the actual values and prices in terms of political and religious norms in the current era. Behind the neglect of political and religious norms in the current era. Behind the neglect of Neumark Neumark onon the concept of value lies the belief that an ethe concept of value lies the belief that an economic theo-conomic theo-retician must explain what really exists without being contingent upon retician must explain what really exists without being contingent upon any judgement, because economics is an “amoral” science indeed.any judgement, because economics is an “amoral” science indeed.111 Even so, he intends to present an analysis on each theory of value.Even so, he intends to present an analysis on each theory of value.

Starting with the criticism of the objec

Starting with the criticism of the objectivist value theory that is tivist value theory that is based on two assumptions that are the existence of perfect competition based on two assumptions that are the existence of perfect competition and reproducibility of goodsand reproducibility of goods,, Neumark Neumark makes mention ofmakes mention of the presence the presence of monopolies in of monopolies in that that current context.current context.112 Hence, he says that the theo-Hence, he says that the theo-ries which handle theries which handle the issue just by looking at the production side, are issue just by looking at the production side, are unrequited unrequited and heand he highlighthighlightss that utility and conditions of demand that utility and conditions of demand should also be considered. Baban’s criticism against the classical think-should also be considered. Baban’s criticism against the classical think-ers like Ricardo and Marxers like Ricardo and Marx,, who considered labor as the main sourcewho considered labor as the main source of of

109 Neumark, Neumark, Kıymet ve Fiyat, Kıymet ve Fiyat, 4.4.

110 Baban, Baban, İktisad, İktisad, 3737.. Baban Baban iin his book n his book handles “utility” and “value” together in one part, handles “utility” and “value” together in one part, and price theory and policy in another. and price theory and policy in another.

111 NeumarkNeumark, , Umumi İktisat Umumi İktisat Kıymet ve Fiyat NazariyeleriKıymet ve Fiyat Nazariyeleri, 4, 4, cited in, cited in PirouPirou,, Introduction a Introduction a l’etude de l’economie politiquel’etude de l’economie politique, Paris , Paris ((19391939: : 113113))..

112 He streHe stresses on the fact that the problems that are related with the organization of sses on the fact that the problems that are related with the organization of market and competition market and competition areare not just economic but also legal issues. Hence, one must not just economic but also legal issues. Hence, one must examine the legal sides to better comprehend the task as Eucken does. He says that the examine the legal sides to better comprehend the task as Eucken does. He says that the concept concept of free market is indeed a legal concept. However, sometimes it is possible of free market is indeed a legal concept. However, sometimes it is possible that statethat state wouldwould implement some regulations oimplement some regulations onn the market in case perfect competi-the market in case perfect competi-tion cannot be realized. Neumark, tion cannot be realized. Neumark, Kıymet ve FiyatKıymet ve Fiyat, , 5151. Based on this arguments,. Based on this arguments, oneone can see how the current economic system is legitimized by such a discourse.can see how the current economic system is legitimized by such a discourse.

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value, is generated from his

value, is generated from his argumentargument that labor has various forms, so it that labor has various forms, so it is not convenient to make comparisons based on labor.is not convenient to make comparisons based on labor.113 He also ar-He also ar-gues against themgues against them asas they don’t take capital and natural components they don’t take capital and natural components into account.into account.114 Consequently, similar with NeuConsequently, similar with Neumark, he also points out mark, he also points out that that oneone cannot just take the long runcannot just take the long run into accountinto account; the supply side and ; the supply side and reproducible goods should also be considered.reproducible goods should also be considered.115

The subjectivist value theory is also inadequate for Neumark be-

The subjectivist value theory is also inadequate for Neumark be-cause it is cause it is considered to be tconsidered to be too individualisticoo individualistic and psychological. He and psychological. He refers to Gide, by saying that this theory is introspective,refers to Gide, by saying that this theory is introspective,116 hence, una-hence, una-ble to explain the economic facts and the phenomenon related with a ble to explain the economic facts and the phenomenon related with a whole modern economic system that is made of goods, capital and whole modern economic system that is made of goods, capital and money. In addition, for him, money. In addition, for him, utility cannot be strictly measured. In other utility cannot be strictly measured. In other words, the subjective value of the goods cannot be compared mathemat-words, the subjective value of the goods cannot be compared mathemat-ically. Being too individualistic and abstract, the circumstances that take ically. Being too individualistic and abstract, the circumstances that take place in the books of place in the books of the the Austrian School seem generally specific Austrian School seem generally specific ab-ab-normal ones according to Neumark, as the subjective value theorists normal ones according to Neumark, as the subjective value theorists mainly consider the use value as the central theme. This is again disa-mainly consider the use value as the central theme. This is again disa-greeable for Neumark for whom the crucial aspect is mentioned as the greeable for Neumark for whom the crucial aspect is mentioned as the exchange value instead of the use value.exchange value instead of the use value.117

All i

All in all, in a scientific perspective, there is no need to elaborate n all, in a scientific perspective, there is no need to elaborate much on the value theory apart from the price theory says Neumarkmuch on the value theory apart from the price theory says Neumark,,118

113 Baban, Baban, İktisad,İktisad, 4040.. By saying this, he refers to the differentiations of the potentials of By saying this, he refers to the differentiations of the potentials of people which cannot be reduced to a people which cannot be reduced to a certain unit.certain unit.

114 BabanBaban, , İktisad,İktisad, 4040--41. He says that the classical thinkers were aware of the deficiencies 41. He says that the classical thinkers were aware of the deficiencies and weak spots of their theory but they deliberatively considered them as trivial ex-and weak spots of their theory but they deliberatively considered them as trivial ex-ceptions, hence excluded them from their analysis. Ibid., 42.ceptions, hence excluded them from their analysis. Ibid., 42.

115 Ibid.,Ibid., 4242..

116 Neumark, Neumark, Kıymet ve FiyatKıymet ve Fiyat, , 2626, cited in Charles, cited in Charles GideGide,, Cours d’economie politiqueCours d’economie politique, 10, 10th th edition, v. 1, Pedition, v. 1, Parisaris, (, (19311931::6767--6868).).

117 Neumark, Neumark, Kıymet ve FiyatKıymet ve Fiyat, , 2828..

118 Neumark, Neumark, Kıymet ve Fiyat, Kıymet ve Fiyat, 30.30. NeumarkNeumark, by intending Gide, claims that those even wh, by intending Gide, claims that those even who o separate value and price, can easily be confused in their explanations. separate value and price, can easily be confused in their explanations. Ibid., 11. Ibid., 11. He He warns against falling into the error of regarding the principal issue of economics as the warns against falling into the error of regarding the principal issue of economics as the birth and distribution of the concept of valuebirth and distribution of the concept of value. Ibid., 5.. Ibid., 5.

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with the argument that all the problems the subjectivist and the objec-

with the argument that all the problems the subjectivist and the objec-tivist value theories deal with, can be examined undtivist value theories deal with, can be examined under the er the heading heading of of price theory. This view is based on the idea that the central theme for price theory. This view is based on the idea that the central theme for economics iseconomics is price, not value.price, not value.119 Referring to Morgenstern in Austrian Referring to Morgenstern in Austrian School who is of the opinion that value theory acts only as an instru-School who is of the opinion that value theory acts only as an instru-ment for understanding the pment for understanding the price making,rice making,120 Neumark emphasizes that Neumark emphasizes that he is in line with Pareto who claimed “we can only accept price which is he is in line with Pareto who claimed “we can only accept price which is the reflection of value and exchangeability, idling around the metaphys-the reflection of value and exchangeability, idling around the metaphys-ical issues is useless; therefore, we should confine ourselves with price ical issues is useless; therefore, we should confine ourselves with price theory analysis.”theory analysis.”121 The fundamental importance given to the price the-The fundamental importance given to the price the-ory is apparent as this issue comprises more than half of his book. He ory is apparent as this issue comprises more than half of his book. He speaks of effective and virtual prices, natural price and market price by speaks of effective and virtual prices, natural price and market price by handling the price formation under differenhandling the price formation under different circumstances, including t circumstances, including monopoly, oligopoly, and competitive markets. He also refers to the monopoly, oligopoly, and competitive markets. He also refers to the supply and demand relations in price formation and summarizes the supply and demand relations in price formation and summarizes the subject.subject.122 In the end of the chapterIn the end of the chapter,, he ultimately claims that one he ultimately claims that one should take the factors thatshould take the factors that determine supply and demand, both in long determine supply and demand, both in long and short term, into account. A similar array is prevalent in other text-and short term, into account. A similar array is prevalent in other text-booksbooks as wellas well. .

Even though Neumark positions himself in a critical position for

Even though Neumark positions himself in a critical position for thethe value theories, Röpke seems to embark more on the subjecvalue theories, Röpke seems to embark more on the subjectivist value tivist value theory. On price determination for instance, Röpke with his Austrian theory. On price determination for instance, Röpke with his Austrian uniform mainly focuses on the marginal utility concept. He says that the uniform mainly focuses on the marginal utility concept. He says that the economic process is not an objective and mechanical thing that occureconomic process is not an objective and mechanical thing that occurs s

119 Ibid., Ibid., 3030.. He reHe refers to fers to Cassel Cassel who regards the term economic value as unnecessary, by who regards the term economic value as unnecessary, by asserting that the whole subject matter of value can be comprehended and analyzed asserting that the whole subject matter of value can be comprehended and analyzed within the framework of price theory.within the framework of price theory. NeumarkNeumark,, Kıymet ve FiyatKıymet ve Fiyat,, 55,, cited in cited in Cassel, Cassel, Theoretische NationalökonomieTheoretische Nationalökonomie, 3, 3rdrd editionedition, Erlangen , Erlangen ((19231923: : 4141--4242)). Suvla, . Suvla, NazariNazari, , 156156..

120 Ibid.,Ibid., 66, cited in, cited in Morgenstern, Morgenstern, ““Probleme der Wertlehre, Schriften das Verreins für Probleme der Wertlehre, Schriften das Verreins für SozialpolitikSozialpolitik””, no., no. 183 1, München 183 1, München ((19311931:: 44).).

121 Ibid.,Ibid., 12, quoted in Pareto, 12, quoted in Pareto, Manuel d’Economie Politique, 2Manuel d’Economie Politique, 2ndnd ed. ed. Paris, (1927: 208Paris, (1927: 208--9) and 9) and 241.241.

122 Baban,Baban, İktisad,İktisad, viivii..

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beyond us; on the contrary, it

beyond us; on the contrary, it is constituted upon our ideasis constituted upon our ideas, , decisions, decisions, miseries and hopes. A million of subjective acts arise from the psyche miseries and hopes. A million of subjective acts arise from the psyche and appear as money, interest and conjuncture. We can obtain the key in and appear as money, interest and conjuncture. We can obtain the key in understanding the nature of objective facts understanding the nature of objective facts ––that appear in the form ofthat appear in the form of marketmarket--, as soon as we totally understand the central point of the psy-, as soon as we totally understand the central point of the psy-chological incidents.chological incidents.123 Suvla also attracts the attention to some excep-Suvla also attracts the attention to some excep-tional cases tional cases which is which is not to be solved by price information.not to be solved by price information.124 Value for Value for him, is the relative importance attached tohim, is the relative importance attached to the instruments that satisfy the instruments that satisfy the needs. It emerges from a comparison and the needs. It emerges from a comparison and a a relation between relation between the the things in the eyes of a person.things in the eyes of a person.125 Consequently, he argues that the objec-Consequently, he argues that the objec-tivist and subjectivist value theories are complementary. He asserts that tivist and subjectivist value theories are complementary. He asserts that the price of athe price of a good converges to the production costs in free market un-good converges to the production costs in free market un-der perfect competition in case the supply of that good can easily be der perfect competition in case the supply of that good can easily be increased. However, he saysincreased. However, he says,, the monopoly prices are mostly influenced the monopoly prices are mostly influenced by the demand for them, the subjective importance attachedby the demand for them, the subjective importance attached to that to that good by the consumer. The value of money can be mostly determined by good by the consumer. The value of money can be mostly determined by utility and scarcity.utility and scarcity.126

As is apparently seen, there is no homogeneity among the authors in

As is apparently seen, there is no homogeneity among the authors in this subject and it is not possible to claim that one theory becomes more this subject and it is not possible to claim that one theory becomes more dominant dominant oveover r the other. Although this is enriching for the content of the other. Although this is enriching for the content of

123 Wilhelm Wilhelm Röpke, Röpke, Cemiyet EkonomisiCemiyet Ekonomisi (İstanbul: Bozkurt Matbaası, 1937), (İstanbul: Bozkurt Matbaası, 1937), 1010.. Röpke Röpke criticizes the ones who regard the marginal utcriticizes the ones who regard the marginal utility principle as a simple Vienna joke. ility principle as a simple Vienna joke. He says, in today’s world, there is no economic outlook that doesn’t act within these He says, in today’s world, there is no economic outlook that doesn’t act within these principles. Even Cassel principles. Even Cassel says says Röpke, who considers the marginal utility as useless, Röpke, who considers the marginal utility as useless, touches upon them. In addition, Cassel articutouches upon them. In addition, Cassel articulated Walras’ complicated theory and lated Walras’ complicated theory and helped the development of economics education after war period in Germany. Röpkehelped the development of economics education after war period in Germany. Röpke,, CemiyetCemiyet,, 2222..

124 SuvlaSuvla, , Nazari, Nazari, 15157.7.

125 Ibid.,Ibid., 15153.3. Suvla claims that fSuvla claims that for instance, money doesn’t have a price, it is a measure of or instance, money doesn’t have a price, it is a measure of exchangexchange value. Also, all kinds of exchange value might not appear e value. Also, all kinds of exchange value might not appear in the form ofin the form of price price in the market. He gives the example of emergence of “consumer rent” when the price in the market. He gives the example of emergence of “consumer rent” when the price of a good is determined in the market and however, consumer was willing to pay even of a good is determined in the market and however, consumer was willing to pay even much mormuch more than that price. Therefore, equating the exchange value to price in a free e than that price. Therefore, equating the exchange value to price in a free market society, is impossible for him. market society, is impossible for him. Ibid., 156.Ibid., 156.

126 SuvlaSuvla, , Nazari, Nazari, 162.162.

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the issue, it becomes hard to categorize these various approaches under

the issue, it becomes hard to categorize these various approaches under oneone prevailing tendencyprevailing tendency. The. The differingdiffering viewpoints for this matter seem viewpoints for this matter seem to be mostly based on the personal opinionsto be mostly based on the personal opinions of the autof the authorshors on the con-on the con-ceptual connotations of value and priceceptual connotations of value and price, rather than being a representa-, rather than being a representa-tion of an ideological position.tion of an ideological position.

§ 3.4 The Relations The Relations ofof Production and DistributionProduction and Distribution

3.4.1 Theories Around the WorldTheories Around the World

Since John Stuart Mill, it is considered that the production

Since John Stuart Mill, it is considered that the production process has a process has a technicaltechnical--economic nature whereas distribution is intended more for economic nature whereas distribution is intended more for social purposes and it has a more composite and complicated nature. social purposes and it has a more composite and complicated nature. Unlike the laws of production, the laws of distribution carry a humane Unlike the laws of production, the laws of distribution carry a humane character.character.127 In other words, while In other words, while the nature of the laws of production the nature of the laws of production was was universaluniversal; ; the nature of distribution of wealth is institutional.the nature of distribution of wealth is institutional.128 To To put it differently, the distribution of wealth is confined to the laws and put it differently, the distribution of wealth is confined to the laws and traditions of a country. Here, the “natural” results of economic activtraditions of a country. Here, the “natural” results of economic activities ities in a society are characterized as transformable by the will of that socie-in a society are characterized as transformable by the will of that socie-ty. There is no “sound” distribution then, at least in charge of the ex-ty. There is no “sound” distribution then, at least in charge of the ex-planatory framework of the economic science.planatory framework of the economic science.129

A British Marxist Historian, Maurice Dobb asserts that mode

A British Marxist Historian, Maurice Dobb asserts that modern eco-rn eco-nomic methodology, unlike the classical political economy methodology, nomic methodology, unlike the classical political economy methodology, is directed towards transforming economics into an exchange theory. is directed towards transforming economics into an exchange theory.

127 HeilbronerHeilbroner, , İktisat Düşünürleriİktisat Düşünürleri,, 114114,, cited in cited in J. S. Mill in J. S. Mill in TThe Principleshe Principles (1848, vol.(1848, vol. 22, , 1, 1, paragraph.paragraph. 1)1)

128 Dobb, “Ekonomi NazariyesininDobb, “Ekonomi Nazariyesinin,” 205.,” 205.

129 Heilbroner, Heilbroner, İktisatİktisat,, 115115..

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This is a limited theory on price relations between the goods appearing

This is a limited theory on price relations between the goods appearing as commodities. Dobb criticizes the ecoas commodities. Dobb criticizes the economics textbooks by asserting nomics textbooks by asserting that there that there existexists a part devoted to “the theory of production”s a part devoted to “the theory of production”130 which is which is more or less bounded by the topics like the nature of the competitive-more or less bounded by the topics like the nature of the competitive-ness in the market and ness in the market and the the changes in demand in terms of changes in demand in terms of theirtheir effects effects on price. On on price. On the other hand, “the theory of distribution” as an individual the other hand, “the theory of distribution” as an individual unit, can find place much rarer in modern economic theory, as it is used unit, can find place much rarer in modern economic theory, as it is used to be perceived as to be perceived as anan extension of the general price theory to the factors extension of the general price theory to the factors of production. The factors of production here,of production. The factors of production here, are tackled as derived are tackled as derived demands generated from the demand demands generated from the demand forfor the final product, by totally the final product, by totally disregarding the individuals and disregarding the individuals and the the social relations between these in-social relations between these in-dividuals. They are dividuals. They are considered and examined as the productive services considered and examined as the productive services existing in the market.existing in the market.131 This This can be defined as acan be defined as a counter argument of counter argument of the dominant tendency tthe dominant tendency that hat considerconsiderss production and distribution are production and distribution are not two different phenomena but two faces of the same phenomenon not two different phenomena but two faces of the same phenomenon and completely similar.and completely similar.132 The shares of the factors of production ac-The shares of the factors of production ac-cording cording to this viewpoint are rent, wage, interest and profit; and an ar-to this viewpoint are rent, wage, interest and profit; and an ar-ray of approaches about each conceptray of approaches about each concept areare presented in the following presented in the following subtitles.subtitles.

130 Maurice Maurice Dobb, “Modern İktisat Teorisinde Görülen Bazı EğilimlerDobb, “Modern İktisat Teorisinde Görülen Bazı Eğilimler Üzerine,” (1949)Üzerine,” (1949) translattranslated by Mehmet Selik. ed by Mehmet Selik. AÜSBFAÜSBFDD 21, no. 1 (21, no. 1 (191966):66): 9191..

131 IbidIbid., ., 9292.. Dobb in the footnote argues that the determination of the prices of the Dobb in the footnote argues that the determination of the prices of the factors of production is considered as an elementary and inseparable part of the gen-factors of production is considered as an elementary and inseparable part of the gen-eral theory. He says that in the colleral theory. He says that in the collection of articles published recently, there is no ection of articles published recently, there is no reference to the dynamics that might affect the supply of the factors of production. The reference to the dynamics that might affect the supply of the factors of production. The social and institutional roots, income distribution among the individuals and classes social and institutional roots, income distribution among the individuals and classes found even lesser place. Distrfound even lesser place. Distribution is portrayed as the same thing with the marginal ibution is portrayed as the same thing with the marginal productivity theory which is a price theory with a certain implementation for Dobb. As productivity theory which is a price theory with a certain implementation for Dobb. As for profit, he refers to Joan Robinson and claims that the modern economics doesn’t for profit, he refers to Joan Robinson and claims that the modern economics doesn’t have a satisfactory theory ohave a satisfactory theory of profit. f profit.

132 Neumark, Neumark, Umumi İktisat TeorisiUmumi İktisat Teorisi 22, , 146146, cited in , cited in Schumpeter: Das Grundprinzip der Schumpeter: Das Grundprinzip der Verteilungstheorie, “archive f. Sozialwissenschaft”Verteilungstheorie, “archive f. Sozialwissenschaft” v.v. 42, 42, ((19161916--1717: : 1010).).

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3.4.1.1 Theories on RentTheories on Rent

Physiocrats during the end of the 18

Physiocrats during the end of the 18thth century were defending that land century were defending that land holds a divine powerholds a divine power and it is the only natural element that creates sur-and it is the only natural element that creates sur-plus in production. Thus, rent was legitimized as the price of landplus in production. Thus, rent was legitimized as the price of land--owners effort to ameliorate the land.owners effort to ameliorate the land.133 For Ricardo on the other hand, For Ricardo on the other hand, rent is the price of use of the original power of the land. This drent is the price of use of the original power of the land. This doesn’t oesn’t arise from the generosity of the naturearise from the generosity of the nature,, but but the the stinginess of it. Together stinginess of it. Together with Malthus’ theory on population, it is considered that the increase in with Malthus’ theory on population, it is considered that the increase in the demand for food by increasing population would result in extending the demand for food by increasing population would result in extending the agricultural cultivationthe agricultural cultivation to less productive fields, which will to less productive fields, which will ascend ascend the costs of production. In a competitive environment, since there the costs of production. In a competitive environment, since there would be only one price for the same quality goods would be only one price for the same quality goods --which corresponds which corresponds at least to the cost of production of the producer working in the hardestat least to the cost of production of the producer working in the hardest conditionsconditions-- the gap between the sale price and the gap between the sale price and the the cost price will be at cost price will be at the advantage of the producer in the productive land, in the form of the advantage of the producer in the productive land, in the form of rent.rent.134 Then, for rent to be occurred, there must be different costs.Then, for rent to be occurred, there must be different costs.135 In In this sense, rent is not a reason of pricthis sense, rent is not a reason of price but a product of it. It is not an e but a product of it. It is not an element of cost, it is differentialelement of cost, it is differential136 and undeserved income for Ricar-and undeserved income for Ricar-dodo137 and his followers, especiallyand his followers, especially forfor socialist Ricardians.socialist Ricardians.

There were also economic thinkers that aim to annihilate rent or at-

There were also economic thinkers that aim to annihilate rent or at-tribute it to the societytribute it to the society. John Stuart Mill suggested plans for expropria-. John Stuart Mill suggested plans for expropria-tion of land, Henry George proposed a single progressive/high rate tion of land, Henry George proposed a single progressive/high rate taxtax138, Gossen thought that state should first buy the land and then hire , Gossen thought that state should first buy the land and then hire it out via auction and Charles Gide recommended state to buy the landit out via auction and Charles Gide recommended state to buy the land

133 Baban,Baban, İktisad,İktisad, 205205..

134 Baban,Baban, İktisad,İktisad, 205205--206206..

135 Heilbroner, Heilbroner, İktisat Düşünürleriİktisat Düşünürleri, 86, 86..

136 Suvla mentionSuvla mentions that the differential rent theory was complemented by von Thünen, s that the differential rent theory was complemented by von Thünen, who also emphasizes the importance of locational rentwho also emphasizes the importance of locational rent. Suvla, . Suvla, Nazari,Nazari, 268268..

137 Baban,Baban, İktisadİktisad, , 207207..

138 Heibroner, 165Heibroner, 165.. For a detailed analysis on the life of Henry George, see Heilbroner For a detailed analysis on the life of Henry George, see Heilbroner “V“Victoria Dönemi ve İktisadın Yeraltı Dünyasıictoria Dönemi ve İktisadın Yeraltı Dünyası”” in in İktisat Düşünürleriİktisat Düşünürleri,, 161161--167167..

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for cash for receival after a century.

for cash for receival after a century.139 As it is seen, the problem of rent As it is seen, the problem of rent turned out to be a matter of academic behavior in the Western World, turned out to be a matter of academic behavior in the Western World, says Robert Heilbroner. It is not because the analysis of Ricardo was says Robert Heilbroner. It is not because the analysis of Ricardo was imperfect, but we achieved an emancipatioimperfect, but we achieved an emancipation from Malthus’ malice by n from Malthus’ malice by the pace of the pace of the the industrial life. Industrialization did not only give us a industrial life. Industrialization did not only give us a slowdown on birth rates but developed our capability to produce goods slowdown on birth rates but developed our capability to produce goods from the land we have.from the land we have.140 Even so, rent, with its various forms, is still a Even so, rent, with its various forms, is still a debatable codebatable concept. ncept.

3.4.1.2 Theories on WageTheories on Wage

For

For the the classical theorists like Smith and Ricardo, the rate of wage classical theorists like Smith and Ricardo, the rate of wage would appear around the minimum subsistence level of the labor.would appear around the minimum subsistence level of the labor.141 Even before the classical thinkers, physiocrats mainly Quesnay, claimed Even before the classical thinkers, physiocrats mainly Quesnay, claimed that the wage declinesthat the wage declines at a minimum rate due to the competition be-at a minimum rate due to the competition be-tween the laborers. The subsistence level provides the minimum condi-tween the laborers. The subsistence level provides the minimum condi-tions for the worker to live in most abstemious conditions and raise a tions for the worker to live in most abstemious conditions and raise a child to compensate his function after his death. This approach within child to compensate his function after his death. This approach within whwhich the worker is considered as a machine, is called the “Iron Law on ich the worker is considered as a machine, is called the “Iron Law on Wages”.Wages”.142 This mechanization can be seen in the perspective in the This mechanization can be seen in the perspective in the population theory of Malthus who argues that if the wage rate falls be-population theory of Malthus who argues that if the wage rate falls be-low this minimum level, the workers would either dlow this minimum level, the workers would either die or immigrate. If it ie or immigrate. If it exceeds this level, they would begin to have more children, both the exceeds this level, they would begin to have more children, both the population and competition will be increased then and the wages will population and competition will be increased then and the wages will be lowered again.be lowered again.143

John Stuart Mill came up with a different theory, namely the “wage

John Stuart Mill came up with a different theory, namely the “wage fund theofund theory” which suggestry” which suggesteded that the decisive factors behind the wage that the decisive factors behind the wage

139 Baban, Baban, İktisadİktisad, , 210210--211211..

140 Heilbroner, Heilbroner, İktisat Düşünürleriİktisat Düşünürleri,, 8989..

141 Heilbroner, Heilbroner, İktisat Düşünürleriİktisat Düşünürleri, , 139.139.

142 The naming was made by German socialist Ferdinand Lasalle. Baban,The naming was made by German socialist Ferdinand Lasalle. Baban, İktisad,İktisad, 227227..

143 Ibid.,Ibid., 228228..

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rates are the amount of labor and capital stock reserved for employing

rates are the amount of labor and capital stock reserved for employing that labor. The wage rates, according to this theory will be increased by that labor. The wage rates, according to this theory will be increased by the increase in capital accumulation.the increase in capital accumulation.144 This theorThis theory prioritizing the cap-y prioritizing the cap-ital accumulation as a influential factor of wages might be indirectly ital accumulation as a influential factor of wages might be indirectly related with another theory, namely “productivity theory”, emphasized related with another theory, namely “productivity theory”, emphasized by Johann Heinrich von Thünen and John Bates Clark. This theory was by Johann Heinrich von Thünen and John Bates Clark. This theory was adopted by the marginalisadopted by the marginalists and neoclassical economists who estab-ts and neoclassical economists who estab-lished relations between wage levels and productivity of labor. For wage lished relations between wage levels and productivity of labor. For wage levels to be increased two conditions are portrayed: a decrease in the levels to be increased two conditions are portrayed: a decrease in the quantity of labor while production conditions remain constant or an quantity of labor while production conditions remain constant or an incincrease in the marginal productivity of labor due to technical innova-rease in the marginal productivity of labor due to technical innova-tions and capital accumulation.tions and capital accumulation.145

Despite the differences, both iron law on wages, wage fund and

Despite the differences, both iron law on wages, wage fund and productivity theories elaborate on wage issue within economistic productivity theories elaborate on wage issue within economistic lenses, instead of regardinglenses, instead of regarding the matter outside the market relations. the matter outside the market relations.

3.4.1.3 Theories on InterestTheories on Interest

The central problematic about the interest theories is concentrated on

The central problematic about the interest theories is concentrated on the legitimacy of interest since the year zero. Aristo asserts that interest the legitimacy of interest since the year zero. Aristo asserts that interest is not legitimate in the sense that moneyis not legitimate in the sense that money can’t produce money, as it is can’t produce money, as it is not productive. Apart from this virtual concern, the emergence of the not productive. Apart from this virtual concern, the emergence of the division between profit and interest becomes a matter of debate as division between profit and interest becomes a matter of debate as well.well.146 As for the theorists intending to legitimize interestAs for the theorists intending to legitimize interest,, French French

144 Ibid.,Ibid., 230230..

145 Baban, Baban, İktisadİktisad, , 233233..

146 Fritz Fritz Neumark, Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fascicule fascicule (İstanbul: Güven Basımevi, (İstanbul: Güven Basımevi, 1942):1942): 335335.. Profit and interest are not divided in the classical school of thought,Profit and interest are not divided in the classical school of thought, espe-espe-cially in Marcially in Marx. Baban also mentions that During the time of Smith and Ricardo, asx. Baban also mentions that During the time of Smith and Ricardo, as they they did no differentiation between capitalist and entrepreneurs, the concept of interest did no differentiation between capitalist and entrepreneurs, the concept of interest embraces the profit also. Baban, embraces the profit also. Baban, İktisadİktisad, , 287287..

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physiocrat Turgot

physiocrat Turgot,, Henry George, Say, Bastiat and Roscher, Clark, Wie-Henry George, Say, Bastiat and Roscher, Clark, Wie-ser, Senior, Irving Fisherser, Senior, Irving Fisher147 and Böhm Bawerkand Böhm Bawerk148 can be counted.can be counted.

Both classical and neoclassical economists recognize

Both classical and neoclassical economists recognizedd interest as the interest as the price of capital. Senior considerprice of capital. Senior considereded interest as the price of sacrifice or interest as the price of sacrifice or aabstinencebstinence. Marx criticize. Marx criticizedd this view in the sense that saving doesn’t this view in the sense that saving doesn’t really mean a selfreally mean a self--sacrifice for the rich; such a consideration legitimizes sacrifice for the rich; such a consideration legitimizes the system of exploitation. Marshall replacethe system of exploitation. Marshall replacedd abstinence with abstinence with waitingwaiting, , and defines interest as the price of waand defines interest as the price of waiting.iting.149 Eugene Böhm Bawerk, Eugene Böhm Bawerk, one of the founding figures of one of the founding figures of the the Austrian School also explains interest Austrian School also explains interest by emphasizing by emphasizing on time.on time. For him, it For him, it iis not about the productivity of capi-s not about the productivity of capi-tal, there is interest because there is intervening time. tal, there is interest because there is intervening time. TTherefore, inter-herefore, inter-est ariest arises from the fact that people prefer ses from the fact that people prefer to to gain today rather thangain today rather than to-to-morrow, namely the time preference.morrow, namely the time preference.150 Schumpeter propounds a Schumpeter propounds a dynamic interest theory by arguing that interest can only occur in an dynamic interest theory by arguing that interest can only occur in an everever--growing economy, there is no interest in a static economgrowing economy, there is no interest in a static economy.y.151

The theories of classicals and neoclassicals can be described as real

The theories of classicals and neoclassicals can be described as real interest theories. They reckon with real saving supply and demand for interest theories. They reckon with real saving supply and demand for capital as the determining factors for interest, disregarding the impacts capital as the determining factors for interest, disregarding the impacts of money on interest rate.of money on interest rate.152 Yet, KeyneYet, Keynes argued against this viewpoint. s argued against this viewpoint. For him, interest is not the price of saving but the price of renunciation For him, interest is not the price of saving but the price of renunciation from liquidity. He constructs his theory of interest on liquidity prefer-from liquidity. He constructs his theory of interest on liquidity prefer-ences.ences.153 It is assumed that people would like to keep the liquid curren-It is assumed that people would like to keep the liquid curren-cy at cy at hand, which might also be defined as the demand for money. hand, which might also be defined as the demand for money. Hence, renouncing from liquidity is considered as a sacrifice that is ex-Hence, renouncing from liquidity is considered as a sacrifice that is ex-

147 Fisher argues that the function of the interestFisher argues that the function of the interest is reflecting the consumer’s inter-is reflecting the consumer’s inter-temporal choices. These choices provide the investment expenditures to be optimal. temporal choices. These choices provide the investment expenditures to be optimal. Oğuz Oğuz Öner, Öner, “Faktörler ve Payları: İktisatta bir Semantik Sorunu,” “Faktörler ve Payları: İktisatta bir Semantik Sorunu,” AÜSBFAÜSBFDD 26, no. 4 26, no. 4 (1971): (1971): 223223..

148 Suvla, Suvla, Nazari, Nazari, 249249--253253..

149 Baban,Baban, İktisİktisad,ad, 287287..

150 Suvla, Suvla, Nazari, Nazari, 254254;; Baban, Baban, İktisadİktisad, , 287287..

151 Röpke,Röpke, Cemiyet Ekonomisi,Cemiyet Ekonomisi, 204204;; Suvla, Suvla, Nazari, Nazari, 255255..

152 Baban,Baban, İktisad,İktisad, 289289..

153 Suvla, Suvla, Nazari, Nazari, 255255..

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pected to be compensated with interest.

pected to be compensated with interest.154 This theory advocated by This theory advocated by Keynes and Wicksell, in which the decisive factor is propouKeynes and Wicksell, in which the decisive factor is propounded as the nded as the demand and supply for money, not saving;demand and supply for money, not saving;155 is called monetary interest is called monetary interest rate.rate.156 A compromise between the real and monetary interest rate was A compromise between the real and monetary interest rate was found by Robertson and Ohlin, who combined each theory by mention-found by Robertson and Ohlin, who combined each theory by mention-ing that the monetary interest rate woulding that the monetary interest rate would be more influential for the be more influential for the short run and the real interest theory in the long run.short run and the real interest theory in the long run.157

3.4.1.4 Theories on ProfitTheories on Profit

Profit, in the reasoning of many liberals, is regarded as an obtainment in

Profit, in the reasoning of many liberals, is regarded as an obtainment in consequence of the endeavor of the entrepreneurs based on their rare consequence of the endeavor of the entrepreneurs based on their rare taletalents.nts.158 Yet, views on profit were more obscure with respect to other Yet, views on profit were more obscure with respect to other factors of production. Smith was indecisive to regard it as a cut from the factors of production. Smith was indecisive to regard it as a cut from the value created by labor or an independent type of gain in capital. Mill value created by labor or an independent type of gain in capital. Mill propounded profit as the reward for being dpropounded profit as the reward for being devoid of something evoid of something --without a satisfactory explanation.without a satisfactory explanation.159 Besides, there were more tena-Besides, there were more tena-cious approaches like Proudhon’s and Marx’s. For them, profit comes up cious approaches like Proudhon’s and Marx’s. For them, profit comes up by the exploitation of labor, as the surplus value can only be created by by the exploitation of labor, as the surplus value can only be created by labor. According to this labor. According to this approach, laborers provide a value that exceeds approach, laborers provide a value that exceeds the production costs in a working day, even so they are paid at subsist-the production costs in a working day, even so they are paid at subsist-ence levels.ence levels.160 The gap between these levels arises from the exploitation The gap between these levels arises from the exploitation of labor and regarded as a stolen income/unpaid wage for Marx.of labor and regarded as a stolen income/unpaid wage for Marx.161

154 Baban, Baban, İktisadİktisad 290290..

155 Ibid.,Ibid., 291291..

156 Ibid.,Ibid., 293293..

157 Ibid.Ibid., 294, 294..

158 Neumark, Neumark, Umumi İktisat Teorisi Umumi İktisat Teorisi v. 2, 2v. 2, 2ndnd fasciculefascicule 437437--440440.. Schumpeter is the one that Schumpeter is the one that resign profit to the entrepreneurresign profit to the entrepreneur. . Öner, Öner, “Faktörler,” “Faktörler,” 221221..

159 Heilbroner, Heilbroner, İktisat Düşünürler, İktisat Düşünürler, 255255..

160 Ibid.,Ibid., 139139..

161 Suvla, Suvla, Nazari, Nazari, 237237--239239; ; Baban,Baban, İktisad, İktisad, 307307.. Walras, in his theory of general Walras, in his theory of general equilequilibrium assert that profits will be zero under perfect competition. Baban, ibrium assert that profits will be zero under perfect competition. Baban, İktisad, İktisad,

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On the other hand, Schumpeter rejected the idea that profit arises n the other hand, Schumpeter rejected the idea that profit arises from exploitation of labor or the income of capital. For him, profit oc-from exploitation of labor or the income of capital. For him, profit oc-curred when the circular flow of economy drifted off its routine route. curred when the circular flow of economy drifted off its routine route. The distraction indeed, was the induction of teThe distraction indeed, was the induction of technological and organiza-chnological and organiza-tional innovations.tional innovations.162 Hence, he scrutinizes profit as the price of the in-Hence, he scrutinizes profit as the price of the in-novations or discoveries of entrepreneurs, based on the assumption novations or discoveries of entrepreneurs, based on the assumption that entrepreneurs are creative. In a similar vein, Knight argues that the that entrepreneurs are creative. In a similar vein, Knight argues that the function of the enfunction of the entrepreneur is to undertake the risks in production. As trepreneur is to undertake the risks in production. As risk increases, the risk takers will diminish and the profit possibilities risk increases, the risk takers will diminish and the profit possibilities increase.increase.163

3.4.2 Internalized Approaches in Textbooks and Journals in TurkeyInternalized Approaches in Textbooks and Journals in Turkey

3.4.2.1 Production and DistributionProduction and Distribution

Production is the cor

Production is the core of the economic system. It is defined by Röpke as e of the economic system. It is defined by Röpke as the creation of a new good the creation of a new good –– which is not necessarily material. This which is not necessarily material. This might be like a transfiguration or appreciation.might be like a transfiguration or appreciation.164 All this production is All this production is exchanged in the market by obtaining prices. Based on this prexchanged in the market by obtaining prices. Based on this price for-ice for-mation, income is determined and distributed. All these are portrayed mation, income is determined and distributed. All these are portrayed as interdependent and simultaneous facts.as interdependent and simultaneous facts.165 Unlike adopting a Millian Unlike adopting a Millian perspective, Röpke considers the distribution of income as a matter of perspective, Röpke considers the distribution of income as a matter of price and rejects any intervention to pprice and rejects any intervention to price formation process to guaran-rice formation process to guaran-

308

308.. Although Walras is a member of Although Walras is a member of the the Lausanne School and theorize in accordance Lausanne School and theorize in accordance with the methods of neoclassical economics, he was a socialist indeed.with the methods of neoclassical economics, he was a socialist indeed.

162 Heilbroner, Heilbroner, İktiİktisat, sat, 5656..

163 Baban, Baban, İktisadİktisad, , 311311..

164 Röpke, Röpke, Cemiyet Ekonomisi, Cemiyet Ekonomisi, 121121..

165 Ibid., Ibid., 123123--125125..

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tee the optimal usage of means of production.

tee the optimal usage of means of production.166 He criticizes the classi-He criticizes the classi-cal thinkers by saying that, they were constrained to establish separate cal thinkers by saying that, they were constrained to establish separate theories as they didn’t take the categories of income as mattertheories as they didn’t take the categories of income as matterss of price. of price. The mThe modern theory on the other hand, came up with a solvent theory odern theory on the other hand, came up with a solvent theory that is based on the marginal productivity principle.that is based on the marginal productivity principle.167

Yet, Neumark seems to embark on Mill’s perspective. The classical

Yet, Neumark seems to embark on Mill’s perspective. The classical school’s belief on the entity of unalterable laws is mainly based on the school’s belief on the entity of unalterable laws is mainly based on the thought that the existing distribution is “fair”, is opposed by Neu-thought that the existing distribution is “fair”, is opposed by Neu-mark.mark.168 Liberals consider this as fair but obviously, socialists don’t. He Liberals consider this as fair but obviously, socialists don’t. He claims that although free market prices include many benefits economi-claims that although free market prices include many benefits economi-cally, we cannot say that it is socially and ecally, we cannot say that it is socially and economically perfect.conomically perfect.169 It is It is also noteworthy to state that Neumark asserts that this kind of distribu-also noteworthy to state that Neumark asserts that this kind of distribu-tion is in favor of capitalist classes.tion is in favor of capitalist classes.170 Pricing the factors of production Pricing the factors of production is a very important element in income organization but not the only one is a very important element in income organization but not the only one for him.for him.171 He is against the argument that distribution is completely He is against the argument that distribution is completely free from any legal and social precautionary interventions.free from any legal and social precautionary interventions.172 In other In other words, distribution words, distribution ––especially organization of incomeespecially organization of income-- can be charac-can be charac-

166 Ibid.,Ibid., 183183; ; SuvlSuvla,a, Nazari, Nazari, 216216..

167 Röpke, Röpke, Cemiyet, Cemiyet, 199199.. He refers to ClarkHe refers to Clark’s ’s “The Distribution of Wealth”“The Distribution of Wealth”..

168 Neumark, Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fasciculefascicule, , 193193.. Oğuz Öner, in his article suggests Oğuz Öner, in his article suggests that the classical school is much more interested in the analysis, the element of “what that the classical school is much more interested in the analysis, the element of “what should be” is relatively remains in the background.should be” is relatively remains in the background. Öner, “Faktörler,” 219.Öner, “Faktörler,” 219.

169 This is because most of the conditions for perfect fuThis is because most of the conditions for perfect functioning of this system is nctioning of this system is currently nonexistent. In current era, there are huge monopoly profits and income currently nonexistent. In current era, there are huge monopoly profits and income wealth. Neumark,wealth. Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fasciculefascicule, , 196, Another aspect of pro-196, Another aspect of pro-duction is the necessity of specialization. This takes its rduction is the necessity of specialization. This takes its roots from Ricardo’s theorem oots from Ricardo’s theorem of comparative advantage. Neumark states that specialization of production is unfa-of comparative advantage. Neumark states that specialization of production is unfa-vorable in the sense that it would make the country more volatile in case of a depres-vorable in the sense that it would make the country more volatile in case of a depres-sion. He also says that competition and entrepreneurship is rsion. He also says that competition and entrepreneurship is restricted in the current estricted in the current conditions and there is a tendency for monopolization; monopolization and nationali-conditions and there is a tendency for monopolization; monopolization and nationali-zation. zation. Ibid.,Ibid., 172172--175175..

170 Ibid.,Ibid., 199199..

171 Ibid.,Ibid., 200200..

172 Neumark, Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fasciculefascicule 193. 193. Neumark gives the examples of Neumark gives the examples of private property and inheritance institutionsprivate property and inheritance institutions..

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terized as a result of a collaboration between

terized as a result of a collaboration between regulariteregularites economiquess economiques and socialand social--legal institutions for Neumark.legal institutions for Neumark.173 In this lineIn this line, one can see , one can see a a tendency to exceed the boundaries of the selftendency to exceed the boundaries of the self--regulating market system, regulating market system, which is compatible with the social market economy understanding thewhich is compatible with the social market economy understanding the Germans generally Germans generally represent frepresent for. However, the measure or the extent of or. However, the measure or the extent of that regulatory interventions might differ from Röpke to Neumark, as that regulatory interventions might differ from Röpke to Neumark, as the former is portrayed as a fervent liberal by the latter. the former is portrayed as a fervent liberal by the latter.

3.4.2.2 On RentOn Rent

The common approach for rent through the texts is parallel with the

The common approach for rent through the texts is parallel with the RicaRicardian view; rent isn’t considered as a reason of price but a conse-rdian view; rent isn’t considered as a reason of price but a conse-quence.quence.174 It is included in the price but it doesn’t influence it.It is included in the price but it doesn’t influence it.175 None-None-theless, Ricardo’s theorem was challenged as it disregarded the im-theless, Ricardo’s theorem was challenged as it disregarded the im-portance of agricultural development. The authors sayportance of agricultural development. The authors say that if Ricardo’s that if Ricardo’s theory was materialized, the share of national income paid as rent and theory was materialized, the share of national income paid as rent and the prices would have increased very much rapidly. This would have the prices would have increased very much rapidly. This would have been unsustainable in the sense that demand for most of the agricultur-been unsustainable in the sense that demand for most of the agricultur-al product is inelastic.al product is inelastic.176 ObvObviously, this didn’t happen. On the contrary, iously, this didn’t happen. On the contrary, there occurred a massive technical progress. there occurred a massive technical progress.

Yet, rent and interest are not considered as meaningless categories

Yet, rent and interest are not considered as meaningless categories by the authors, they are by the authors, they are considered as the considered as the factors that have a mission in factors that have a mission in

173 Ibid., Ibid., 193193..

174 ÖnerÖner, “Faktörler,” , “Faktörler,” 225225.. Öner Öner mentions Samuelson’s book, in which he suggests that mentions Samuelson’s book, in which he suggests that “whether rent is a determinant “whether rent is a determinant cost of price or not depends on the viewpointcost of price or not depends on the viewpoint““ ((rantın rantın fiyatı tayin eden bir maliyet olup olmadığı görüş açınıza bağlıdırfiyatı tayin eden bir maliyet olup olmadığı görüş açınıza bağlıdır)) quoted inquoted in Economics, Economics, SamuelsonSamuelson,, 601. Öner criticizes Samuelson in the sense that it opens the door for the 601. Öner criticizes Samuelson in the sense that it opens the door for the pragmatic mistakes to be tpragmatic mistakes to be tolerated.olerated. Ibid., 226.Ibid., 226.

175 Suvla, 275Suvla, 275;; NeumarkNeumark, , Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fasciculefascicule, , 408408--409409..

176 NeumarkNeumark, , Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fasciculefascicule, , 399. For a detailed criticism for 399. For a detailed criticism for Ricardo’s thought, see Samuelson, “Economists and History of IdeasRicardo’s thought, see Samuelson, “Economists and History of Ideas,,” ” in in The American The American Economic Review,Economic Review, 52, no.52, no. 1 (March 1962)1 (March 1962)..

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economy.

economy.177 Rent is definRent is defined as a price arisen from the utilization of land; ed as a price arisen from the utilization of land; and like other prices, it appears in accordance with the scarcity ratio.and like other prices, it appears in accordance with the scarcity ratio.178 In addition, Röpke states that the rent of the producers will absolutely In addition, Röpke states that the rent of the producers will absolutely be eradicated onbe eradicated onee day by dint of competition. If not, it iday by dint of competition. If not, it is also possible to s also possible to collect rent by means of collect rent by means of some some taxes, to provide social justice.taxes, to provide social justice.179 Alt-Alt-hough theoretically possible, the socioeconomic dynamics play the key hough theoretically possible, the socioeconomic dynamics play the key role on whether such a model proves to be feasible or not.role on whether such a model proves to be feasible or not.

3.4.2.3 On WageOn Wagess

As for the issues related wi

As for the issues related with wage, we see a reaction to the classical th wage, we see a reaction to the classical school’s representative figures’ theories. Ricardo’s theory, namely school’s representative figures’ theories. Ricardo’s theory, namely iron iron law of wageslaw of wages180 which constructs a relation between the wage rates and which constructs a relation between the wage rates and labor supply is challenged.labor supply is challenged.181 Neumark claims that the principles in theNeumark claims that the principles in the price theory cannot be adapted/ implemented to the wage theory even price theory cannot be adapted/ implemented to the wage theory even by the ones who believe that labor is a commodity and wage is the price by the ones who believe that labor is a commodity and wage is the price of it.of it.182 The iron law of wages is also criticized by Suvla in the sense that The iron law of wages is also criticized by Suvla in the sense that it disregards the particularities of lait disregards the particularities of labor by considering it identical to bor by considering it identical to any any other meta. In addition, it is emphasized that the minimum level of other meta. In addition, it is emphasized that the minimum level of subsistence is not that easy to quantify even if a social minimum com-subsistence is not that easy to quantify even if a social minimum com-

177 Röpke, Röpke, Cemiyet, Cemiyet, 190190..

178 Ibid., Ibid., 206206..

179 Ibid., Ibid., 148148..

180 Suvla,Suvla, Nazari, Nazari, 281281. . Denomination is made by Lasalle,Denomination is made by Lasalle,..

181 The assertion that market price will evolve into natural price is also criticized forThe assertion that market price will evolve into natural price is also criticized for being too abstract and inelastic, thus unable to explain the real facts. Neumark, being too abstract and inelastic, thus unable to explain the real facts. Neumark, Umumi Umumi İktisat Teorisi v. 2, 2İktisat Teorisi v. 2, 2ndnd fasciculefascicule, , 269269..

182 Neumark, Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fasciculefascicule 265. Suvla defines wage rate as the 265. Suvla defines wage rate as the price of labor. Suvla,price of labor. Suvla, Nazari,Nazari, 277277.. Röpke claims that the labor power should also be Röpke claims that the labor power should also be considered as a scarce resource/cconsidered as a scarce resource/commodity and pricing it should be done accordingly. ommodity and pricing it should be done accordingly. RöpkeRöpke, , Cemiyet, Cemiyet, 121121..

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fort level is considered.

fort level is considered.183 The practical facts about demography dis-The practical facts about demography dis-proved the asproved the assumptions of the theory in the opinion of the authors.sumptions of the theory in the opinion of the authors.184

The wage fund theory propounded by Mill is also challenged be-The wage fund theory propounded by Mill is also challenged be-cause of its negligence of the impact of wage rate on the effectivity of cause of its negligence of the impact of wage rate on the effectivity of labor. This theory for Neumark is more suitable for the malabor. This theory for Neumark is more suitable for the material needs terial needs in the early phases of capitalism.in the early phases of capitalism.185 Suvla also opposes this theory by Suvla also opposes this theory by arguing that it merely focuses on the demand for laborarguing that it merely focuses on the demand for labor186 and ignores and ignores the specialties of labor market, it is impossible to provide a healthy cal-the specialties of labor market, it is impossible to provide a healthy cal-culation of a wage fund. He claculation of a wage fund. He claims that both iron law of wages and wage ims that both iron law of wages and wage fund theory are influenced by the prophecies of Malthus about the de-fund theory are influenced by the prophecies of Malthus about the de-mographical issues and income, hence both theories are pessimistic.mographical issues and income, hence both theories are pessimistic.187 Apart from the criticisms, we are not confronted with an alternative Apart from the criticisms, we are not confronted with an alternative analysis analysis on wage, the commentaries are mainly concentrated on inves-on wage, the commentaries are mainly concentrated on inves-tigations on the implementation possibilities of thetigations on the implementation possibilities of thesese old theories pro-old theories pro-pounded. Even so, these explications give the reader some idea on the pounded. Even so, these explications give the reader some idea on the invalidity of the classical thinking in the eyes of the ainvalidity of the classical thinking in the eyes of the authors.uthors.

3.4.2.4 On InterestOn Interest

Interest has always been a matter of fact that is open to debate, yet ef-

Interest has always been a matter of fact that is open to debate, yet ef-forts to legitimate interest by freeing it from any moral contemplations forts to legitimate interest by freeing it from any moral contemplations is clearly seen through the writings of the academics. To start with, is clearly seen through the writings of the academics. To start with, Neumark defines iNeumark defines interest both as a factor of cost and income nterest both as a factor of cost and income --like wagelike wage--, and claims that the moral considerations prevent a valid understand-, and claims that the moral considerations prevent a valid understand-

183 Baban, Baban, İktisad,İktisad, 230230..

184 Suvla, Suvla, Nazari, Nazari, 281281--282282;; Baban, Baban, İktisad,İktisad, 229229..

185 Neumark, Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fascicule,fascicule, 271271..

186 Suvla, Suvla, Nazari, Nazari, 28283. 3. Baban claims that it even Baban claims that it even doesn’t thoroughly elaborate on the doesn’t thoroughly elaborate on the determining factors of the demand for labor. Although important, the working capital determining factors of the demand for labor. Although important, the working capital is not the only determinant of the demand for labor. is not the only determinant of the demand for labor. Baban, Baban, İktisadİktisad, , 233233..

187 Suvla,Suvla, Nazari, Nazari, 282282--283. Malthus was regarded as pessimist283. Malthus was regarded as pessimistic as the course of events ic as the course of events falsified falsified his hypothesis. his hypothesis.

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ing of its nature. Interest is demonstrated as a price but the price of

ing of its nature. Interest is demonstrated as a price but the price of what? In answering this question, he refers to Cassel who clwhat? In answering this question, he refers to Cassel who claimed that aimed that interest is the price of capital disposition.interest is the price of capital disposition.188 Suvla also suggests that Suvla also suggests that interest is not the price of capital, it is a reward in return to disposition. interest is not the price of capital, it is a reward in return to disposition. BöhmBöhm--Bawerk’s theoryBawerk’s theory189 is paid special emphasis by Neumark among is paid special emphasis by Neumark among his juxtaposition of the theorhis juxtaposition of the theories of Mengeries of Menger190, theorie d’abstinence, the-, theorie d’abstinence, the-ories du temps, Jevons, Bastiat, Cairness, Marshall, Fisher; Schumpeter ories du temps, Jevons, Bastiat, Cairness, Marshall, Fisher; Schumpeter and Keynes.and Keynes.191 Although he avoids from being a party to a theory, his Although he avoids from being a party to a theory, his effort to legitimize interest is clearly seen throughout his analysis.effort to legitimize interest is clearly seen throughout his analysis.

The

The reason why capital disposition has an economic character is reason why capital disposition has an economic character is manifested as its scarcity.manifested as its scarcity.192 Röpke claims that if there was no interest, Röpke claims that if there was no interest, scarce capital would have encountered with an infinite demand.scarce capital would have encountered with an infinite demand.193 Thus, pricingThus, pricing thethe capital in the form of interest is rationcapital in the form of interest is rational and economi-al and economi-cally indispensable. For instance, unlike Aristo’s thesis, Neumark refers cally indispensable. For instance, unlike Aristo’s thesis, Neumark refers to Sismondi who asserts that interest is not the fruit of money but capi-to Sismondi who asserts that interest is not the fruit of money but capi-tal.tal.194 By emphasizing this, Neumark distances his approach from By emphasizing this, Neumark distances his approach from Keynesian monetary approach on inKeynesian monetary approach on interest. Keynesian approach is even terest. Keynesian approach is even never mentioned in Röpke’s book. Similar with Marshall, Röpke fastens never mentioned in Röpke’s book. Similar with Marshall, Röpke fastens on elaborating the concept as a price for waiting.on elaborating the concept as a price for waiting.195 He even meets on a He even meets on a common ground with Marx in rejection of the theories that associate common ground with Marx in rejection of the theories that associate

188 Neumark, Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fascicule,fascicule, 326326--328328..

189 Öner, referring to Shackle, says that BöhmÖner, referring to Shackle, says that Böhm--Bawerk is the first economist who Bawerk is the first economist who established a theory based on the share of the capital ownestablished a theory based on the share of the capital owners in the total product. ers in the total product. Öner, “FaktörlerÖner, “Faktörler,,” 220” 220..

190 Menger’s theory is diametrically opposed to Aristo’s, Neumark, Menger’s theory is diametrically opposed to Aristo’s, Neumark, Umumi İktisat Teorisi v. Umumi İktisat Teorisi v. 2, 22, 2ndnd fasciculefascicule,, 339339..

191 Neumark, Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fasciculefascicule,, 347347..

192 Röpke, Röpke, Cemiyet, Cemiyet, 203203;; Neumark,Neumark, Umumi İktisatUmumi İktisat, , 360360; ; Suvla,Suvla, Nazari,Nazari, 256256..

193 Röpke, Röpke, Cemiyet,Cemiyet, 203203..

194 Neumark, Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fasciculefascicule,, 361361..

195 Röpke, Röpke, CemiyetCemiyet, , 128128.. He refers to Böhm Bawerk, Cassel, Fisher and Cannan as the He refers to Böhm Bawerk, Cassel, Fisher and Cannan as the explainers of a similar theory related with “waiexplainers of a similar theory related with “waitingting..””

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interest wit

interest with “sacrifice”, which was mainly advocated by Senior, as the h “sacrifice”, which was mainly advocated by Senior, as the sacrifice arisen from saving will diminish as wealth increases.sacrifice arisen from saving will diminish as wealth increases.196

3.4.2.5 On ProfitOn Profit

Profit is portrayed as a product of price, not a constitutive element of it.

Profit is portrayed as a product of price, not a constitutive element of it. A literature review on the diverse percepA literature review on the diverse perceptions on profit with references tions on profit with references to Sombart, Ricardo, Marx, Leroy Beaulieu and Veblen is presented in to Sombart, Ricardo, Marx, Leroy Beaulieu and Veblen is presented in Neumark’s book. He says that profit is undoubtedly among the most Neumark’s book. He says that profit is undoubtedly among the most important motivations that prompt the entrepreneur to conduct a busi-important motivations that prompt the entrepreneur to conduct a busi-ness, although not thness, although not the only one.e only one.197 Notwithstanding, profit is portrayed Notwithstanding, profit is portrayed as a carrier of a significant social function in current economy.as a carrier of a significant social function in current economy.198 For For Röpke, one who would appreciate the pace of our economic system, Röpke, one who would appreciate the pace of our economic system, must also appreciate the existence of profit.must also appreciate the existence of profit.199

Marxian perspective on

Marxian perspective on profit is rejected by Baban, as he claims that profit is rejected by Baban, as he claims that such an assumption can only be valid under monopolistic conditions. In such an assumption can only be valid under monopolistic conditions. In case there is perfect competition and great number entrepreneurs, the case there is perfect competition and great number entrepreneurs, the wage rates will equate the marginal productivity of labor.wage rates will equate the marginal productivity of labor.200 He also He also crit-crit-icizes Schumpeter’s theory on profit by emphasizing that it can’t explain icizes Schumpeter’s theory on profit by emphasizing that it can’t explain the profits of noncreative entrepreneurs.the profits of noncreative entrepreneurs.201 Suvla adopts the view of Suvla adopts the view of Knight, by defining profit as the share of the risk taker entrepreneur.Knight, by defining profit as the share of the risk taker entrepreneur.202 A common ground of the arguments regaA common ground of the arguments regarding profit seems to be dis-rding profit seems to be dis-tanced from a Marxian understanding.tanced from a Marxian understanding.

196 Röpke, Röpke, CemiyetCemiyet, , 51. Here Röpke mentions the German Socialist Ferdinand Lasalle, who 51. Here Röpke mentions the German Socialist Ferdinand Lasalle, who ridicules Senior’s approach. ridicules Senior’s approach.

197 Neumark, Neumark, Umumi İktisat Teorisi v. 2, 2Umumi İktisat Teorisi v. 2, 2ndnd fasciculefascicule,, 440. Other motivations are 440. Other motivations are mentioned as mmentioned as metaeconomic considerations and work etaeconomic considerations and work pleasurepleasure..

198 Ibid.Ibid.,, 440440..

199 Röpke,Röpke, Cemiyet, Cemiyet, 189. He rejects the approaches that claim profit can be gained without 189. He rejects the approaches that claim profit can be gained without doing any work. For him, the competition would already eradicate such occasions.doing any work. For him, the competition would already eradicate such occasions.

200 Baban,Baban, İktisad, İktisad, 307307..

201 Ibid.,Ibid., 311311..

202 Suvla, Suvla, Nazari, Nazari, 216216..

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It seems like the shares of the factors of production are considered

It seems like the shares of the factors of production are considered generally in line with the neoclassical understanding although the au-generally in line with the neoclassical understanding although the au-thors try to avoid from being an advocate for a certathors try to avoid from being an advocate for a certain theory. However, in theory. However, their oppositions and justifications provided for those oppositionstheir oppositions and justifications provided for those oppositions,, can can provideprovide anan insight about the theories they are disapproved of. Except insight about the theories they are disapproved of. Except the conceptualization on rent of Ricardo, the theorizations of the classi-the conceptualization on rent of Ricardo, the theorizations of the classi-cal thinkers as wellcal thinkers as well as the Marxian way of thinking are not adoptedas the Marxian way of thinking are not adopted by by the authors, which is not an unanticipated preference indeedthe authors, which is not an unanticipated preference indeed. .

§ 3.5 AA GeneralGeneral Evaluation onEvaluation on EconomicsEconomics TextbooksTextbooks

3.5.1 Prominent Textbooks on Economics around Europe and the Prominent Textbooks on Economics around Europe and the USAUSA

Marco Guidi and Massimo Augello in

Marco Guidi and Massimo Augello in their their TThe Economic Reader he Economic Reader arguargue e tthat that the approach of textbooks offers a promising perspective for he approach of textbooks offers a promising perspective for ““a a deep understanding of the specific nature of economic science, involv-deep understanding of the specific nature of economic science, involv-ing a variety of social actors and stakes, hence a product of social con-ing a variety of social actors and stakes, hence a product of social con-struction thastruction that evolves through time in a complex institutional con-t evolves through time in a complex institutional con-text.text.””203 Therefore, elaborating on the central themes of the textbooks Therefore, elaborating on the central themes of the textbooks utilized in utilized in various regionsvarious regions in a comparative perspective,in a comparative perspective, contains contains clues clues about about the the similarities and differences between the social ansimilarities and differences between the social and institu-d institu-tional structures of them. tional structures of them. The economics textbooks utilized in European The economics textbooks utilized in European countries and the US in the late 19countries and the US in the late 19thth and early 20and early 20thth century provide ref-century provide ref-erence points for the analysis of textbooks in Turkey. To locate the theo-erence points for the analysis of textbooks in Turkey. To locate the theo-retical position of the textboretical position of the textbooks in Istanbul University, first it would be oks in Istanbul University, first it would be meaningful to see the agenda of the textbooks in various countries, and meaningful to see the agenda of the textbooks in various countries, and zoom in the dissemination of ideas of basic economic thinkers via them. zoom in the dissemination of ideas of basic economic thinkers via them.

203 Augello and Guidi, Augello and Guidi, Economic Reader,Economic Reader, 44..

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First,

First, it would be meaningful toit would be meaningful to begin with France which was a begin with France which was a cocountry that generated a cultural hegemony in the 19untry that generated a cultural hegemony in the 19thth century. In century. In France, economics textbooks were regarded as major means for build-France, economics textbooks were regarded as major means for build-ing of a new society, a constructive framework for the social behavior to ing of a new society, a constructive framework for the social behavior to be oriented accordingly with the requirements of pobe oriented accordingly with the requirements of political economy. litical economy. Theoretically speaking, they are considered as the diffuser instruments Theoretically speaking, they are considered as the diffuser instruments of a new form of of a new form of ““governmentalitygovernmentality””, a concept coined by Michel Fou-, a concept coined by Michel Fou-cault.cault.204 Not surprisingly, French John Baptiste Say’s work, which was Not surprisingly, French John Baptiste Say’s work, which was translated into many languages, translated into many languages, was very influential in this sense during was very influential in this sense during the 19the 19thth century France. Instead of the theoretical issues that preoccu-century France. Instead of the theoretical issues that preoccu-pied Ricardo and Malthus, Say was aiming to disseminate political pied Ricardo and Malthus, Say was aiming to disseminate political economy as his understanding of the political economy served for the economy as his understanding of the political economy served for the enlightenlightenment of emerging new society in a revolutionary era, the citi-enment of emerging new society in a revolutionary era, the citi-zens of the industrial society. In the late 19zens of the industrial society. In the late 19thth century, there were century, there were threethree traites d’economie politique, Cauwes, Gide and Leroy Beaulieu. Charles traites d’economie politique, Cauwes, Gide and Leroy Beaulieu. Charles Gide’s was the most successful. The mathematicaGide’s was the most successful. The mathematical political economy l political economy remained remained marginal in France indeed, except the wellmarginal in France indeed, except the well--known works of known works of WalrasWalras and Pareto.and Pareto.205 Röpke defines the situation in France as inertiaRöpke defines the situation in France as inertia206 and Baban mentions that the absence of a faculty of economics and Baban mentions that the absence of a faculty of economics -- as it as it was rooted in law schoolswas rooted in law schools-- prprevented the members of this science to evented the members of this science to specialize on the discipline. As an indispensable outcome, economics specialize on the discipline. As an indispensable outcome, economics turned out to be wandering path of the scholars whose minds are dif-turned out to be wandering path of the scholars whose minds are dif-ferently educated.ferently educated.207

204 PhilipPhilip SteinerSteiner,, “Cours, Leçons, Manules, Precis and Traites, Teaching Political Economy “Cours, Leçons, Manules, Precis and Traites, Teaching Political Economy in Nineteenth Century Francein Nineteenth Century France,,” in ” in Economic Reader,Economic Reader, 9090--9191..

205 SteinerSteiner,, “Cours, Leçons“Cours, Leçons,,”” 8686--87. Walras, 87. Walras, Éléments d’économie politique pureomie politique pure, final , final edition published in 1900edition published in 1900, Pareto, , Pareto, Cours d’économie politique, 1896––97, and Manuel d’économie politique, Italian edition 1906, French translation 1909..

206 Wilhelm Wilhelm Röpke, Röpke, Ekonomi İlminin Tekamül TarihiEkonomi İlminin Tekamül Tarihi,, translated by Muhlis Ete translated by Muhlis Ete (İstanbul, (İstanbul, 1936),1936), 143.143.

207 Baban,Baban, İktisad,İktisad, vivi..

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In Britain, the major book till the 1950s was Alfred Marshall

In Britain, the major book till the 1950s was Alfred Marshall’s ’s Prin-Prin-ciplesciples208. Marshall’s influence, particularly at Cambridge. Marshall’s influence, particularly at Cambridge209 was longwas long--lastinglasting. The Marshallians. The Marshallians210, rather than focusing on mathematical for-, rather than focusing on mathematical for-malism, were mostly oriented to practical intuitive arguments; instead malism, were mostly oriented to practical intuitive arguments; instead of idealized conditions, they focused on reof idealized conditions, they focused on representativepresentative conditions. Yet, conditions. Yet, starting from the 1930s, the consensus on Marshallian understanding starting from the 1930s, the consensus on Marshallian understanding was challenged.was challenged.211 The English marginalists, especially the LSEThe English marginalists, especially the LSE212 were were influenced by the Austrian and Lausanne School more than Marshallian influenced by the Austrian and Lausanne School more than Marshallian and Cambridge ecole.and Cambridge ecole.213 Since the 1930s till Since the 1930s till the the 1960s, the impact of 1960s, the impact of the the teaching practice of teaching practice of LSE was dominant LSE was dominant in terms of basic economics in terms of basic economics

208 This book which occurred as a central source of authority transformed into a textbook This book which occurred as a central source of authority transformed into a textbook by by the 1950s. Keith Tribe, “Economic Manuals and Textbooks in Great Britain and the the 1950s. Keith Tribe, “Economic Manuals and Textbooks in Great Britain and the British Empire 1797British Empire 1797--1938” in 1938” in EconomiEconomic Readerc Reader, 44. He appreciated the German histor-, 44. He appreciated the German histor-ical school for both overcoming the tightness of economic theory and focusing on evo-ical school for both overcoming the tightness of economic theory and focusing on evo-lution of institutions. Although Marshall was very good at mathematics, he was also lution of institutions. Although Marshall was very good at mathematics, he was also interested in moral philosophy and ethics.interested in moral philosophy and ethics. “Alfred Marshall”. “Alfred Marshall”. https://www.hetwebsite.net/het/profiles/marshall.htmhttps://www.hetwebsite.net/het/profiles/marshall.htm . . Marshall’sMarshall’s book is men-book is men-tioned to be entirely discursive as the diagrams and algebra were all presented in ap-tioned to be entirely discursive as the diagrams and algebra were all presented in ap-pendipendix. x. Tribe, “Economic ManualsTribe, “Economic Manuals,” ,” 61.61.

209 As for another classical university, Oxford was mostly dominated by the economists As for another classical university, Oxford was mostly dominated by the economists with historical and philosophical approaches. The teaching of economics as a separate with historical and philosophical approaches. The teaching of economics as a separate task was much later than Cambridge. task was much later than Cambridge. Ercan Ercan Uygur anUygur and d Oya S. Oya S. Erdoğdu, Erdoğdu, ““Avrupa, ABD Avrupa, ABD ve Türkiye’de İktisat Eğitimive Türkiye’de İktisat Eğitimi,” in ,” in İktisat Eğitimiİktisat Eğitimi ((Ulusal İktisat Eğitimi SempozyumuUlusal İktisat Eğitimi Sempozyumu), ), ed. ed. Ercan Uygur (Ankara: İmaj Yayınevi, 2005):Ercan Uygur (Ankara: İmaj Yayınevi, 2005): 6464..

210 “The Cambridge Neoclassicals” https://www.hetwebsite.net/het/schools/english.htm“The Cambridge Neoclassicals” https://www.hetwebsite.net/het/schools/english.htm Taussig at Taussig at Harvard, Pantaleoni in Italy were the main actors for the spread Marshallian Harvard, Pantaleoni in Italy were the main actors for the spread Marshallian ideasideas..

211 “The Cambridge Neoclassicals” https://www.hetwebsite.net/het/schools/english.htm“The Cambridge Neoclassicals” https://www.hetwebsite.net/het/schools/english.htm

212 LSE was founded by Socialist Fabian Society under the guidance of Sidney Webb and LSE was founded by Socialist Fabian Society under the guidance of Sidney Webb and Bernard Shaw, to concentrate on social problems but since from the very beginning, itBernard Shaw, to concentrate on social problems but since from the very beginning, it came under the influence of neoclassical economics, Uygur and Aydoğdu, “Avrupa, came under the influence of neoclassical economics, Uygur and Aydoğdu, “Avrupa, ABD ve Türkiye’deABD ve Türkiye’de,,” 66” 66. . Especially after 1929 when Lionel Robbins became the chair, Especially after 1929 when Lionel Robbins became the chair, Hayek was invited to LSE. This was a reflection of a new rivalry between LSE and Hayek was invited to LSE. This was a reflection of a new rivalry between LSE and CambridgeCambridge, as the views of Keynes in Cambridge and Hayek in LSE were inconsistent. , as the views of Keynes in Cambridge and Hayek in LSE were inconsistent. Ibid., Ibid., 7979..

213 Uygur and Erdoğdu, “Avrupa, ABD ve Türkiye’deUygur and Erdoğdu, “Avrupa, ABD ve Türkiye’de,,”” 79.79.

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textbooks

textbooks..214 As for an exAs for an example, Honor Scott’s ample, Honor Scott’s Approach to EconomicsApproach to Economics215 was based on the LSE way and nurtured by the advice of Lionel Robbins.was based on the LSE way and nurtured by the advice of Lionel Robbins. Apart fromApart from his bookhis book,, there was Benham’s there was Benham’s EconomicsEconomics, originally pub-, originally pub-lished in 1938 which was aiming to provide a realistic account of the lished in 1938 which was aiming to provide a realistic account of the functioning of economic system in Britain.functioning of economic system in Britain.216

In Germany, Schmoller

In Germany, Schmoller217, a representative figure for the , a representative figure for the secondsecond generation Gegeneration German Historical Schoolrman Historical School218 came to forefront in the 19came to forefront in the 19thth century. Schmoller, who considered the Marshallian and Ricardian doc-century. Schmoller, who considered the Marshallian and Ricardian doc-trines trines –– the old English schoolthe old English school-- as outdated, adopted an ethical ap-as outdated, adopted an ethical ap-proach and inductive methodology. His texts were in dialogue with Wproach and inductive methodology. His texts were in dialogue with We-e-ber’s vision on value judgements. Schmoller’s 1400 paged ber’s vision on value judgements. Schmoller’s 1400 paged GrundrisseGrundrisse, ,

214 Tribe, “Tribe, “Economic ManualsEconomic Manuals,” 62. ,” 62. Hicks, Sweezy, Lerner, Shackle and Scitovsky were Hicks, Sweezy, Lerner, Shackle and Scitovsky were among the among the economists that contrieconomists that contribute to the advance of LSE during the 1930s. Uygur bute to the advance of LSE during the 1930s. Uygur and Erdoğdu, “Avrupa, ABD ve Türkiye’deand Erdoğdu, “Avrupa, ABD ve Türkiye’de,,”” 79.79.

215 KeithKeith Tribe, “Economic ManualsTribe, “Economic Manuals,” ,” 6363--6464.. Tribe reveals the content of the book as Tribe reveals the content of the book as follows: follows: “introductory chapter moves quickly through three distinct points:“introductory chapter moves quickly through three distinct points: that eco-that eco-nomics is the study of scarcity, that value depends upon scarcity, and that capital is a nomics is the study of scarcity, that value depends upon scarcity, and that capital is a stock and income a flow (1stock and income a flow (1––6). The second chapter deals with markets, price being a 6). The second chapter deals with markets, price being a coordinating mechanism; and in the third chapter on demand diminishing marcoordinating mechanism; and in the third chapter on demand diminishing marginal ginal utility and the elasticity of demand are introduced. The fifth chapter, on factors of pro-utility and the elasticity of demand are introduced. The fifth chapter, on factors of pro-duction, in fact dismisses the pertinence of ‘Land, Labour and Capital’, and provides a duction, in fact dismisses the pertinence of ‘Land, Labour and Capital’, and provides a distindistinctly Austrian account of capital and time, Böhm--Bawerk being mentioned by Bawerk being mentioned by name in connection with the idea of ‘roundabout production’ (48). Later sections of name in connection with the idea of ‘roundabout production’ (48). Later sections of the book deal with the organisation of industry, money and credit, economic geogra-the book deal with the organisation of industry, money and credit, economic geogra-phy, the nationphy, the national income, public finance, trade cycles, unemployment, protection and al income, public finance, trade cycles, unemployment, protection and free trade, rounded off with a twofree trade, rounded off with a two--page structured reading list in which Marshall’s page structured reading list in which Marshall’s PrinciplesPrinciples is described as ‘the most authoritative single work on the subject’ (207).” is described as ‘the most authoritative single work on the subject’ (207).” Tribe, 63.Tribe, 63.

216 IIbbiidd., ., 6464..

217 Schmoller was the head of Verein für SoSchmoller was the head of Verein für Sozzialpolitik, which rejects the laissez faire ialpolitik, which rejects the laissez faire approach, from 1890 till 1917approach, from 1890 till 1917..

218 German Historical School was very influential in the universities of Prussia till 1871. In German Historical School was very influential in the universities of Prussia till 1871. In addition, Germany became a center addition, Germany became a center of attraction for the ones beyond Germany, who of attraction for the ones beyond Germany, who want to have economics education, as it was the only country that provided a system-want to have economics education, as it was the only country that provided a system-atic education on political economy. Many Americans were educated in the universi-atic education on political economy. Many Americans were educated in the universi-ties in Germany, among whom there are, R. T. ties in Germany, among whom there are, R. T. Ely, J. B. Ely, J. B. Clark, and E. R. A. Seligman., Clark, and E. R. A. Seligman., Uygur and Aydoğdu, “Avrupa, ABD ve Türkiye’deUygur and Aydoğdu, “Avrupa, ABD ve Türkiye’de,,” 68.” 68.

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was a descriptive and detailed panorama of moral, legal and psychologi-

was a descriptive and detailed panorama of moral, legal and psychologi-cal foundations of economy and society, as Schmoller believed that the cal foundations of economy and society, as Schmoller believed that the combination of the historical combination of the historical phenomenaphenomena and sand statistical materials pro-tatistical materials pro-vide an adequate vide an adequate groundground for economic and social reasoning. He was of for economic and social reasoning. He was of the opinion that social justice should be implemented by government’s the opinion that social justice should be implemented by government’s paternalistic policies.paternalistic policies.219 Yet, after a while, a counterYet, after a while, a counter--view came from view came from Philippovich for whom Philippovich for whom the socialthe social and economicand economic reforms should be built reforms should be built upon solid economic analysis. Philippovich was one of the most out-upon solid economic analysis. Philippovich was one of the most out-standing textbook writers in German language area in the late 19standing textbook writers in German language area in the late 19thth and and early 20early 20thth century, who was influenced by the Austrian School, Menger, century, who was influenced by the Austrian School, Menger, Wieser and Böhm Bawerk.Wieser and Böhm Bawerk.220 The debate between German Historical The debate between German Historical School and Austrian School became evident once more.School and Austrian School became evident once more.

The very first criticisms against the German Historical School was

The very first criticisms against the German Historical School was voiced by Carl Menger from University of Vienna. His book, voiced by Carl Menger from University of Vienna. His book, The Princi-The Princi-ples ples of Economicsof Economics is considered among the primary basic sources of is considered among the primary basic sources of marginalism. The Austrian School, among which there are Eugen von marginalism. The Austrian School, among which there are Eugen von Böhm Bawerk, Ludwig von Mises and Friedrich von Hayek, was distin-Böhm Bawerk, Ludwig von Mises and Friedrich von Hayek, was distin-guished by the Germans from themselves.guished by the Germans from themselves.221 Yet, the historical scYet, the historical school hool lost its impact as a center of gravity after the Wlost its impact as a center of gravity after the World orld WWar ar I, without being I, without being succeeded by a new dominant understanding succeeded by a new dominant understanding --although there occurred although there occurred a rise of neoclassical economicsa rise of neoclassical economics--. This created an ambiguity on the cur-. This created an ambiguity on the cur-rent situation of economics in Germanrent situation of economics in Germany which was diagnosed by y which was diagnosed by Schumpeter. The crisis was resolved by the help of Knut Wicksell and Schumpeter. The crisis was resolved by the help of Knut Wicksell and Gustav Cassel. During the 1920s, Cassel’s Gustav Cassel. During the 1920s, Cassel’s Theory of Social Economy Theory of Social Economy was was

219 HHarald Harald Hagemann and M. Rösch. “Economic Textbooks in the German Language Areaagemann and M. Rösch. “Economic Textbooks in the German Language Area,,” ” in in Economic ReaderEconomic Reader, , 109109--110110..

220 Ibid.Ibid., 110, 110..

221 Uygur Uygur and Aydoğdu, and Aydoğdu, “Avrupa, ABD ve Türkiye’“Avrupa, ABD ve Türkiye’dede,,”” 6969. . Methodologically, the German Methodologically, the German and Austrian Ecole was distinct from each other. A comparison by Seager reveals the and Austrian Ecole was distinct from each other. A comparison by Seager reveals the difference. Seager claims that if a student would like to study economic history, social difference. Seager claims that if a student would like to study economic history, social problems, public finance and applied economicproblems, public finance and applied economics, he would better choose the Berlin; if s, he would better choose the Berlin; if he would like to be learn about economic theory, methodological problems in econo-he would like to be learn about economic theory, methodological problems in econo-my, the evolution of economic theory, he should choose Vienna. my, the evolution of economic theory, he should choose Vienna. Ibid., Ibid., 6969, , cited cited in in SSeager (1893eager (1893::2727--28)28)..

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the prominent textbook.

the prominent textbook.222 As for the 1950s and As for the 1950s and the the 1960s, the econom-1960s, the econom-ic thinking of the Geric thinking of the Germamann students was mostly shaped by students was mostly shaped by the textbooks the textbooks of Erich Schneiderof Erich Schneider223, an eager Keynesian of the neoclassical synthesis. , an eager Keynesian of the neoclassical synthesis. As the German translation of Samuelson’s As the German translation of Samuelson’s Economics Economics was also published was also published in 1952, the combination of Keynesian macroeconomic base and the in 1952, the combination of Keynesian macroeconomic base and the neocneoclassical microeconomic theory became dominant in Germany till lassical microeconomic theory became dominant in Germany till the early 1970s.the early 1970s.224

During the early 20th century,

During the early 20th century, Charles Gide’s Charles Gide’s Cours d’eCours d’économie poli-conomie poli-tiquetique was basic material for the teaching of political economywas basic material for the teaching of political economy in univer-in univer-sitysity, both in Spain and some South A, both in Spain and some South American countries with many re-merican countries with many re-publications. Although publications. Although Principles Principles by Alfred Marshall by Alfred Marshall was translatedwas translated in in 1911, 1911, and Irving Fisher’sand Irving Fisher’s Nature of Capital and Income Nature of Capital and Income in 1912; in 1912; they they didn’t make such influencedidn’t make such influence in thein the instruction ofinstruction of faculties of law.faculties of law.225 As for As for the neoclasthe neoclassical theory, we again see the name Gustav Cassel’s sical theory, we again see the name Gustav Cassel’s Theory of Theory of Social EconomicsSocial Economics, which was translated in 1933., which was translated in 1933.226 The translated texts The translated texts in the 20in the 20thth century were mostly focused on the historical and century were mostly focused on the historical and institu-institu-tional provisiontional provisions of economic action and specified natus of economic action and specified nature of public in-re of public in-terterferenceference in the national economy.in the national economy.227

The orientation in Netherlands in the 19

The orientation in Netherlands in the 19thth century was generally in-century was generally in-clined to the old Austrian School, particularly on clined to the old Austrian School, particularly on Friedrich von Wieser Friedrich von Wieser and Eugen von Boand Eugen von Böhmhm--Bawerk in value and capital theory. Bawerk in value and capital theory. Yet, the Yet, the im-im-pact of individual’s subjective evaluations in determination of prices of pact of individual’s subjective evaluations in determination of prices of

222 Harald Hagemann and MattHarald Hagemann and Matthias Rösch, “Economics Textbooks in the German Language hias Rösch, “Economics Textbooks in the German Language Area,” in Area,” in Economic Reader, Economic Reader, 115.115.

223 Schneider’s article “Zamanımızın İktisat Teorisi” which was his text on the opening Schneider’s article “Zamanımızın İktisat Teorisi” which was his text on the opening lecture of Kiel University, was translated by Mehmet Selik and published in the lecture of Kiel University, was translated by Mehmet Selik and published in the JJournal ournal of the Faculty of Political Sciencesof the Faculty of Political Sciences in Ankara Universityin Ankara University..

224 Hagemann and Rösch, “Economics Textbooks,” 116Hagemann and Rösch, “Economics Textbooks,” 116--117.117.

225 SalvadorSalvador AlmenarAlmenar,, “Teaching, Spreading and Preaching: Textbooks of Political Economy “Teaching, Spreading and Preaching: Textbooks of Political Economy in Spain 1779in Spain 1779--19361936,,” in ” in Economic ReaderEconomic Reader,, 179.179.

226 AlmenarAlmenar,, “Teaching, Spreading“Teaching, Spreading,” 182.,” 182.

227 Ibid., Ibid., 183183..

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goods for instance, was considered to be much more

goods for instance, was considered to be much more subjectivist subjectivist with with respect to the assumptionsrespect to the assumptions of the mentioned Austrian School figuresof the mentioned Austrian School figures..228

Till the end of the 19

Till the end of the 19thth century, century, the the ScaScandinavian political econo-ndinavian political econo-mists were defined as “butterflies uttering between the different inter-mists were defined as “butterflies uttering between the different inter-national schools of thought, taking from each what they felt useablenational schools of thought, taking from each what they felt useable”” borrowing and combining various ideas from the contemporary authors borrowing and combining various ideas from the contemporary authors from the powerful counfrom the powerful countries. Generally, there were translations or local-tries. Generally, there were translations or local-ized versions of these ideas till Wicksell and Cassel became internation-ized versions of these ideas till Wicksell and Cassel became internation-ally popular.ally popular.229 Especially Cassel’s book gained worldwide impact. Cas-Especially Cassel’s book gained worldwide impact. Cas-selsel230 emphasizes the need for an economic theory with “uniform emphasizes the need for an economic theory with “uniform termterminology and quantitative concepts” to orient the public policy. He inology and quantitative concepts” to orient the public policy. He focuses on social policy, claiming that state also serves for the interests focuses on social policy, claiming that state also serves for the interests of equity. Trade unions and cooperatives were also appreciated under of equity. Trade unions and cooperatives were also appreciated under the conditions of free entry and exit, in cathe conditions of free entry and exit, in case their leaders are educated. se their leaders are educated. The Keynesian paradigm began to spread in the 1930s via Ohlin and The Keynesian paradigm began to spread in the 1930s via Ohlin and Myrdal, who called themselves as the Stockholm School of EconomicsMyrdal, who called themselves as the Stockholm School of Economics-- prominent figures of the new economy. Keynesian message was spread prominent figures of the new economy. Keynesian message was spread to Finland via these ageto Finland via these agents. Yet, till the 1950s, Keynesian paradigm nts. Yet, till the 1950s, Keynesian paradigm was was nonot apparentlyt apparently voicedvoiced in elementary tein elementary teachingaching. From then on, the domain . From then on, the domain of political economy was gradually narrowed to economics. The Euro-of political economy was gradually narrowed to economics. The Euro-pean influence was almost replaced by pean influence was almost replaced by textbooks of textbooks of SamuelsoSamuelsonn--stylestyle. . ThThe neoclassical synthesis was favored as it was seen deemed suitable e neoclassical synthesis was favored as it was seen deemed suitable for the political and economic model of Scandinavia, which was a capi-for the political and economic model of Scandinavia, which was a capi-talist economy with a growing welfare state.talist economy with a growing welfare state.231

228 Evert Schoorl and Henk Plasmeijer, “From Ruminators to Pioneers: Dutch Economics Evert Schoorl and Henk Plasmeijer, “From Ruminators to Pioneers: Dutch Economics Textbooks and their Authors in the Nineteenth and Early Twentieth CenturyTextbooks and their Authors in the Nineteenth and Early Twentieth Century,,” in ” in Eco-Eco-nomic Readernomic Reader, , 279.279.

229 JohaJohan M. Lönnrothn M. Lönnroth,, “Political Economy Textbooks and Manuals and the Roots of the “Political Economy Textbooks and Manuals and the Roots of the Scandinavian ModelScandinavian Model,,” in ” in Economic ReaderEconomic Reader, 301, 301..

230 In Cassel’s view the theory of marginal utility was unnecessary for explaining prices In Cassel’s view the theory of marginal utility was unnecessary for explaining prices and the market mechanism, and both Marshall and the market mechanism, and both Marshall and the Austrian school were consid-and the Austrian school were consid-ered useless. Röpke appreciates Cassel in the sense that he made Walras’ general equi-ered useless. Röpke appreciates Cassel in the sense that he made Walras’ general equi-librium theory more understandable.librium theory more understandable. Röpke, Röpke, Cemiyet Ekonomisi, Cemiyet Ekonomisi, 22.22.

231 Lönnroth, “Political Economy TextbooksLönnroth, “Political Economy Textbooks,” 299,” 299-- 300300..

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The economics education in the US universities was under the influ-

The economics education in the US universities was under the influ-ence ofence of Oxford, Cambridge and Edinburgh UniversitiesOxford, Cambridge and Edinburgh Universities,, especially in the especially in the 1818thth century.century.232 The US textbooks were embarked upon conveying the The US textbooks were embarked upon conveying the canon of Smith, Ricardo, Mill and Marshall by modified versions, as the canon of Smith, Ricardo, Mill and Marshall by modified versions, as the US economists were not central agents in argumentationUS economists were not central agents in argumentations.s.233 After the After the independence from Britain, French and German universities gained independence from Britain, French and German universities gained weight.weight.234 During the period between 1830 and 1930, economicsDuring the period between 1830 and 1930, economics was was described as the science of wealthdescribed as the science of wealth and and was embedded into a moral phi-was embedded into a moral phi-losophy, even considered as a part of it.losophy, even considered as a part of it.235 AtAt the turn of the century, the the turn of the century, the impact of German Historical School became apparent. Yet at the end, the impact of German Historical School became apparent. Yet at the end, the naming has changed from political economy at the beginning naming has changed from political economy at the beginning toto eco-eco-nomics.nomics.236 As for the 1940s, Robert Solow mentions about 3 textbooks As for the 1940s, Robert Solow mentions about 3 textbooks in Harvard, among whicin Harvard, among which there is Garver and Hansen’s book.h there is Garver and Hansen’s book.237 These These books were mostly in parallel with discursive tendencies books were mostly in parallel with discursive tendencies –– although less although less descriptive, there was no diagrams or equationsdescriptive, there was no diagrams or equations238 which signifies that which signifies that the thinking and reasoning of economists were oriented to policy issuthe thinking and reasoning of economists were oriented to policy issues es instead of presenting models.instead of presenting models.239 The main principles of the current The main principles of the current textbooks were void of actual data on the economy. The absence of a textbooks were void of actual data on the economy. The absence of a textbook within which the theoretical content and statistical data wtextbook within which the theoretical content and statistical data wereere

232 Uygur Uygur and Aydand Aydoğduoğdu,, “Avrupa, ABD ve Türkiye’de“Avrupa, ABD ve Türkiye’de,,”” 7070..

233 David Colander, “The Evolution of US Economics TextbooksDavid Colander, “The Evolution of US Economics Textbooks,,” in ” in Economic Reader,Economic Reader, 325325..

234 Chicago and Stanford Universities were founded under the influence of German Chicago and Stanford Universities were founded under the influence of German system. Uygursystem. Uygur and Aydoğdu, and Aydoğdu, “Avrupa, ABD ve Türki“Avrupa, ABD ve Türkiye’deye’de,,”” 7070..

235 Colander,Colander, “The Evolution“The Evolution,”,” 3326.26.

236 In 1892, this change took place in Harvard, then in other American universities. By the In 1892, this change took place in Harvard, then in other American universities. By the way, similar with what Marshall did in Cambridge, the economic theory and economic way, similar with what Marshall did in Cambridge, the economic theory and economic history became distinguished. Uyguhistory became distinguished. Uygur r and Aydoğdu, and Aydoğdu, “Avrupa, ABD ve Türkiye’de“Avrupa, ABD ve Türkiye’de,,”” 7272..

237 Colander,Colander, “The Evolution“The Evolution,”,” 33333.3.

238 Colander,Colander, “The Evolution“The Evolution,”,” 33333. 3. The lack of mathematics courses astonished The lack of mathematics courses astonished Schumpeter, who joined Harvard in 1932, as in Chicago, Yale and Columbia, there are Schumpeter, who joined Harvard in 1932, as in Chicago, Yale and Columbia, there are mathematical mathematical economics. Uygur economics. Uygur and Aydoğdu, and Aydoğdu, “Avrupa, ABD ve Türkiye’de“Avrupa, ABD ve Türkiye’de,,”” 8585..

239 Harvard was a center of attraction for the Harvard was a center of attraction for the émigréémigré economists such as Leontief and economists such as Leontief and Haberler. Samuelson claims that the ascent of American economics after the 1940s Haberler. Samuelson claims that the ascent of American economics after the 1940s were accelerated by virtuewere accelerated by virtue of the German emigre economists. Uygur of the German emigre economists. Uygur and Aydoğdu, and Aydoğdu, “Avrupa, ABD ve Türkiye’de“Avrupa, ABD ve Türkiye’de,,”” 8585, , cited cited in in Scherer Scherer ((20002000:: 615615).).

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combined was apparently felt. This was portraye

combined was apparently felt. This was portrayed as the reason for the d as the reason for the chair of economics department at MITchair of economics department at MIT240, Ralph Freeman who request-, Ralph Freeman who request-ed Samuelson to write an introductory text.ed Samuelson to write an introductory text.241 Colander mentions that Colander mentions that still during the 1940s, Keynesian economics was not still during the 1940s, Keynesian economics was not significantly significantly intro-intro-duced to the textsduced to the texts mentioned mentioned by Solowby Solow..242

From

From the the 1930s to 1930s to the the 1950s economic texts have changed as eco-1950s economic texts have changed as eco-nomics became much more formal and mathematical discipline. nomics became much more formal and mathematical discipline. TThe he mmethodology also shifted, “from a Marshallian one thingethodology also shifted, “from a Marshallian one thing--atat--aa--time time common sense approach to a Walrasian everythingcommon sense approach to a Walrasian everything--atat--ononce mathemati-ce mathemati-cal approach”. Microeconomics from then on was organized around a cal approach”. Microeconomics from then on was organized around a Walrasian approach to economics, by presentation of the supply and Walrasian approach to economics, by presentation of the supply and demand curves. Macroeconomics was based on a “Keynesian aggregate demand curves. Macroeconomics was based on a “Keynesian aggregate expenditures/aggregate production model” withexpenditures/aggregate production model” with the aim of providing the aim of providing full employment via social policy.full employment via social policy.243 This combination reflects the main This combination reflects the main constituents of the neoclassical synthesis coined by Paul Samuelson, constituents of the neoclassical synthesis coined by Paul Samuelson, which would appear as the new mainstream in Turkey since the midwhich would appear as the new mainstream in Turkey since the mid--1960s as well.1960s as well.

Among the vari

Among the various experiences of the countries the similarities be-ous experiences of the countries the similarities be-tween the Portuguese and Turkish cases are not just about the periodi-tween the Portuguese and Turkish cases are not just about the periodi-zation but also about the traditional teaching of economics first in zation but also about the traditional teaching of economics first in the the law faculties, instrumentally dependent upon the techniques oflaw faculties, instrumentally dependent upon the techniques of law ac-law ac-counting and commerce.counting and commerce.244 Portugal also implied a reform on curricular Portugal also implied a reform on curricular

240 For a detailed analysis of history of economics discipline at MIT, see Beatrice Cherrier, For a detailed analysis of history of economics discipline at MIT, see Beatrice Cherrier, ““A Preliminary History of Economics at MIT 19A Preliminary History of Economics at MIT 194040--19721972,,” March 2011” March 2011 andand Roy E. Wein-Roy E. Wein-traub, “Telling the Story of MIT Economics in the Posttraub, “Telling the Story of MIT Economics in the Post--war Periodwar Period,,” ” History of Political History of Political EconomyEconomy 46, Duke University Press46, Duke University Press (2014)(2014)..

241 YannYann GiraudGiraud,, “The Political Economy of Textbook Writing: Paul Samuelson and the “The Political Economy of Textbook Writing: Paul Samuelson and the makingmaking of the First Ten Editions of Economics (1945of the First Ten Editions of Economics (1945--1976)1976),”,” ((August 2011August 2011):): 66--77..

242 Colander, “The EvolutionColander, “The Evolution,”,” 334334..

243 Ibid.,Ibid., 335335..

244 Almodovar and Cardoso. Almodovar and Cardoso. A History of PortugueseA History of Portuguese, , 101. 101. This situation is not peculiar to This situation is not peculiar to Portugal or Turkey. Portugal or Turkey. J. F. H. J. F. H. Roper claimRoper claims that in the majority of European countries; s that in the majority of European countries; Austria, Belgium, Denmark, France, Germany, Greece, Italy, Netherlands, Norway, Austria, Belgium, Denmark, France, Germany, Greece, Italy, Netherlands, Norway, Spain, Sweden and Switzerland, the teaching of economics has been associated with Spain, Sweden and Switzerland, the teaching of economics has been associated with

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structure which gave rise to the emergence of a sharp contrast to the

structure which gave rise to the emergence of a sharp contrast to the way of its application at law schools. The theoretical quality of the new way of its application at law schools. The theoretical quality of the new textbooks were influenced by the grotextbooks were influenced by the growing maturity of neoclassical eco-wing maturity of neoclassical eco-nomics and economics began to appear as an autonomous domain with nomics and economics began to appear as an autonomous domain with a new toolbox.a new toolbox.245 In the aftermath of the 1949 reform which aimed a In the aftermath of the 1949 reform which aimed a catching up process, there occurred a university subjectcatching up process, there occurred a university subject mattermatter devoted devoted particularly to Keyparticularly to Keynesian macroeconomics, in addition to a number of nesian macroeconomics, in addition to a number of other subjects other subjects –– likelike public finance, development economics and econ-public finance, development economics and econ-ometrics ometrics –– through which Keynesian through which Keynesian notionnotions played a s played a quitequite critical critical role.role.246

The abovementioned points reflect both the experience of develop

The abovementioned points reflect both the experience of developed ed countries within which Turkey was culturally most interlinked regard-countries within which Turkey was culturally most interlinked regard-ing the dissemination of economic theories and the South European ing the dissemination of economic theories and the South European countries which showcountries which show particular particular similarities with Turkey.similarities with Turkey. NextNext will be will be concentconcentratedrated on the on the textbooks on economics utilitextbooks on economics utilized zed locally withlocally within a in a historical framework. historical framework.

3.5.2 Textbooks on Economics in the Ottoman EmpireTextbooks on Economics in the Ottoman Empire

During the reign of the Ottoman Empire, the first concepts used for the

During the reign of the Ottoman Empire, the first concepts used for the discipline of economics were discipline of economics were TedbirTedbir--i Menzili Menzil (1852) and İ(1852) and İlmlm--i Tedbiri Tedbir--i i MenzilMenzil (1859) by Sahak Efendi; the former referring to an elemental (1859) by Sahak Efendi; the former referring to an elemental advice and the latter is a French originated doctrinal liberalism. Rossi’s advice and the latter is a French originated doctrinal liberalism. Rossi’s TasarrufatTasarrufat--ı Mülkiyeı Mülkiye can be characterized as a reorganized version of can be characterized as a reorganized version of Smithian ideas oSmithian ideas on the track of John Baptiste Say. The loyalty to classical n the track of John Baptiste Say. The loyalty to classical thinkers was also apparent in the book of the first Ottoman economy thinkers was also apparent in the book of the first Ottoman economy

the teaching of law, especially public law, due

the teaching of law, especially public law, due to the fact that economics was consid-to the fact that economics was consid-ered as a part of the training of a civil servant.ered as a part of the training of a civil servant. J. F. H. J. F. H. RoperRoper, , The Teaching of Economics The Teaching of Economics at the University Level at the University Level ((London: Harrap, London: Harrap, 1970)1970), , 1414..

245 Almodovar and Cardoso. Almodovar and Cardoso. A History of PortugueseA History of Portuguese, , 101011--102.102.

246 Ibid.Ibid., 113, 113..

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writer Mehmet Şerif’s

writer Mehmet Şerif’s İlmİlm--i Emvali Emval--i Mülkiyei Mülkiye..247 According to Fikret According to Fikret Görün, the books till Ahmet Mithat’s Görün, the books till Ahmet Mithat’s Ekonomi PolitikEkonomi Politik (1879) wer(1879) were en-e en-gendered independent from the history, culture and economic practices gendered independent from the history, culture and economic practices of the society they appealed to. The actors engaged into economic of the society they appealed to. The actors engaged into economic knowledge that time seems to be disassociated with the economic phe-knowledge that time seems to be disassociated with the economic phe-nomena in their country.nomena in their country.248

The observations on the

The observations on the economics curricula signify that economics curricula signify that there there were were three important “modernthree important “modern--rational” themes in the 19rational” themes in the 19thth century century Ottoman EmpireOttoman Empire; ; agricultural economy, economic geography and agricultural economy, economic geography and home economics courses home economics courses wewere utilized in the textbooks. The books re utilized in the textbooks. The books that are Ohannes Pathat are Ohannes Pashsha’sa’s MebadiMebadi--i İlmi İlm--i Serveti Servet249 and Musa Aky-and Musa Aky-iğitzade’siğitzade’s250 İktisat yahut İlmİktisat yahut İlm--i Serveti Servet were influential in teaching of were influential in teaching of economics. After the foundation of Darülfünun, liberal minded economics. After the foundation of Darülfünun, liberal minded Mehmet Cavit Bey’s Mehmet Cavit Bey’s İlmİlm--i İktisati İktisat came at the forefront which made a came at the forefront which made a distinction betweendistinction between art and science of economicsart and science of economics..251 It was an inspi-It was an inspi-rational source for that generation till the war conditions pushed the rational source for that generation till the war conditions pushed the empire apply national economyempire apply national economy..252

247 Fikret Görün’s “Nasıl İktisatçı Oldum?Fikret Görün’s “Nasıl İktisatçı Oldum?,,” in ” in İktisat Eğitimi Sempozyumuİktisat Eğitimi Sempozyumu, , 50. 50. This is This is mentioned as the direct translation of mentioned as the direct translation of TThe Wealth of Nationshe Wealth of Nations into Ottoman languageinto Ottoman language..

248 Ibid.,Ibid., 5050..

249 This book was advocating economic liberalism based on the comparaThis book was advocating economic liberalism based on the comparative advantage tive advantage theory and emphasize the importance of agriculture in a liberal economic system. This theory and emphasize the importance of agriculture in a liberal economic system. This is considered as the most influential by Niyazi Berkes, as it was utilized in Mülkiye till is considered as the most influential by Niyazi Berkes, as it was utilized in Mülkiye till Cavit Bey’s book for he education of future bureaucrats. Uygur Cavit Bey’s book for he education of future bureaucrats. Uygur aand Aydoğdu, nd Aydoğdu, “Avrupa, “Avrupa, ABD ve Türkiye’deABD ve Türkiye’de,,”” 91, cited 91, cited inin Berkes (1972Berkes (1972::50) 50) ..

250 Akyiğitzade challenged the liberal ideas, and defendedAkyiğitzade challenged the liberal ideas, and defended the idea of “national economy” the idea of “national economy” and the necessity of industrialization based on and the necessity of industrialization based on protectionism. Fındıkoğlu,protectionism. Fındıkoğlu, Türkiye’de Türkiye’de İktisatİktisat, , 45.45.

251 EnginEngin, “Ottoman Teaching, “Ottoman Teaching,,”” 9393.. Fikret Görün also claims that the term “economics” Fikret Görün also claims that the term “economics” first emerges at the Hamidian era and become established by Mehmet Cavid in Mülki-first emerges at the Hamidian era and become established by Mehmet Cavid in Mülki-ye. Görün, “Nasıl İktisatçı Oldum?ye. Görün, “Nasıl İktisatçı Oldum?,,”” 50.50.

252 The national economics was influenced byThe national economics was influenced by the idea that what is to be focused is not the idea that what is to be focused is not only “what is to be done” (as the classical understanding of economics), but also “what only “what is to be done” (as the classical understanding of economics), but also “what is already done” to see the immaterial elements. It is impossible to reach the economic is already done” to see the immaterial elements. It is impossible to reach the economic

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The evolution of economic thought in the Ottoman Empire by the

The evolution of economic thought in the Ottoman Empire by the dichotomy of liberalism and protectionism cdichotomy of liberalism and protectionism coincided with the period oincided with the period the Western economic thought changed shell.the Western economic thought changed shell.253 The emergence of The emergence of this division should be assessed as a natural process instead of a rad-this division should be assessed as a natural process instead of a rad-ical break due to the progressive evolution of economic ideas. The ical break due to the progressive evolution of economic ideas. The economics textbooks reflected theconomics textbooks reflected this natural progress encapsulating is natural progress encapsulating both the political economy and the science of economics views, dis-both the political economy and the science of economics views, dis-regarding the distinction between the two when focusing on econom-regarding the distinction between the two when focusing on econom-ics.ics.254

3.5.3 An Evaluation on Economics Textbooks in the Republican An Evaluation on Economics Textbooks in the Republican PeriodPeriod

The textbooks presen

The textbooks presented in the previous sections of this chapter were ted in the previous sections of this chapter were Röpke’s Röpke’s CemiyeCemiyett EkonomisiEkonomisi (1937), and (1937), and Ekonominin Bugünkü MeseleleriEkonominin Bugünkü Meseleleri, , Dobretsberger’s Dobretsberger’s Ekonomi SiyasetiEkonomi Siyaseti (1940), Neumark’s (1940), Neumark’s Umumi İktisat Te-Umumi İktisat Te-orisiorisi (1940(1940--19421942--1944), Suvla’s 1944), Suvla’s Nazari İktisatNazari İktisat (1949) and Baban’s (1949) and Baban’s İkti-İkti-

reality just by applying the classic

reality just by applying the classical economics’ doctrines and purifying the economics al economics’ doctrines and purifying the economics from politicfrom politics.s. Toprak, Toprak, Milli İktisat, Milli BurjuvaziMilli İktisat, Milli Burjuvazi, 16, 16..

253 Akkuzu Akkuzu and Alada, and Alada, “Türkiye’de YYayınlananayınlanan,” ,” 66.. The authors mention that thThe authors mention that the historical e historical context and the positivist wave in the nineteenth century signify a division between context and the positivist wave in the nineteenth century signify a division between the value judgements and analytic economics. the value judgements and analytic economics. It was an epistemological break from It was an epistemological break from the classical economics to marginalism by its new instruments that are the utility the-the classical economics to marginalism by its new instruments that are the utility the-ory of value, the marginal productivity of labor and consumer preferences. The leading ory of value, the marginal productivity of labor and consumer preferences. The leading figures of the marginalist revolution were Jevfigures of the marginalist revolution were Jevons, Menger and Walras; against the clas-ons, Menger and Walras; against the clas-sical economists Smith, Ricardo and Mill. sical economists Smith, Ricardo and Mill.

254 Akkuzu and Alada argue that tAkkuzu and Alada argue that this perception was existent since Cavit Bey’s book till his perception was existent since Cavit Bey’s book till the 1960s, Hazım Atıf Kuyucak’s the 1960s, Hazım Atıf Kuyucak’s İktisat Dersleriİktisat Dersleri and Feridun Ergin’s and Feridun Ergin’s İktisat.İktisat. The prima-The prima-ry purpose of the textbooks was to explain the birth of economics and its independ-ry purpose of the textbooks was to explain the birth of economics and its independ-encencee from the other fields of sfrom the other fields of social science. However, what is to be understood from ocial science. However, what is to be understood from economics is the classical economieeconomics is the classical economie--politique views in these textbooks. That is to say, politique views in these textbooks. That is to say, they highlight the character of the political economy that has a holistic view for the they highlight the character of the political economy that has a holistic view for the society instead of a positisociety instead of a positivist understanding that distances itself from the social and vist understanding that distances itself from the social and political sphere, till the 1960s. Akkuzu political sphere, till the 1960s. Akkuzu and Alada, and Alada, “Türkiye’de YYayınlananayınlanan,” ,” 1414..

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sat İlminin Umumi Prensipleri

sat İlminin Umumi Prensipleri (1957). To see what is going on in the (1957). To see what is going on in the teaching of introductory economics through years and grab the moving teaching of introductory economics through years and grab the moving parts of the process chronologicparts of the process chronologically, it would be meaningful to begin ally, it would be meaningful to begin with Röpke’s book. with Röpke’s book.

Cemiyet Ekonomisi

Cemiyet Ekonomisi which defines economics as a “disciplined anar-which defines economics as a “disciplined anar-chy”, consists of sections that are “the base of economics, marginal utili-chy”, consists of sections that are “the base of economics, marginal utili-ty, division of labor (demographical issues), money and credty, division of labor (demographical issues), money and credits (pur-its (pur-chasing power, inflation, deflation), production (cost and factors of chasing power, inflation, deflation), production (cost and factors of production), market and prices (demand supply elasticities, monopo-production), market and prices (demand supply elasticities, monopo-lies, foreign trade), distribution of income (interest, rent), the economic lies, foreign trade), distribution of income (interest, rent), the economic organism, great depression and alterorganism, great depression and alternative economic systems. Among native economic systems. Among the following books, Röpke’s book can be described as the most discur-the following books, Röpke’s book can be described as the most discur-sive. There are only few diagrams and graphicssive. There are only few diagrams and graphics,, and mathematics is very and mathematics is very rarely used, just at a basic level. Indeed, it is a pleasure torarely used, just at a basic level. Indeed, it is a pleasure to readread RöpkeRöpke,, as as he he wrwrites like a conversation. He gives interesting examples from real ites like a conversation. He gives interesting examples from real life even life even in in explainexplaininging the most theoretical issues. The inspiration for the most theoretical issues. The inspiration for him seems to be him seems to be extractedextracted from the daily life, literature, cultural stories from the daily life, literature, cultural stories and current economic situations. For instand current economic situations. For instance, he expresses the concept ance, he expresses the concept of value by referring to Shakespeare’s III. Richard who was ready to give of value by referring to Shakespeare’s III. Richard who was ready to give the whole kingdom to a horse that is expected to rescue the hero of the the whole kingdom to a horse that is expected to rescue the hero of the book.book.255 To certify the argument that wealth is created by saving, he To certify the argument that wealth is created by saving, he gives the egives the example of Henry Ford, whose wealth is composed of his fab-xample of Henry Ford, whose wealth is composed of his fab-rics instead of money.rics instead of money.256 Apart from his writing style, what is prominent Apart from his writing style, what is prominent through the book is his through the book is his AustrianAustrian vein which manifests itself vein which manifests itself particularly particularly in his emphasis on the marginal utility. “All the thein his emphasis on the marginal utility. “All the theoretical construction oretical construction of economics is based upon this principle.” claims Röpke. The theorists of economics is based upon this principle.” claims Röpke. The theorists of the last fifty years for him became distinguished by preaching to of the last fifty years for him became distinguished by preaching to these principles.these principles.257 These prominent figures are presented as Menger, These prominent figures are presented as Menger, Jevons, Walras, Pareto, PJevons, Walras, Pareto, Pantaleoni, Clark, Wicksteed, Wicksell, Cassel antaleoni, Clark, Wicksteed, Wicksell, Cassel and Böhm Bawerk. Although there are some variations in their point of and Böhm Bawerk. Although there are some variations in their point of

255 Röpke, Röpke, Cemiyet EkonomisiCemiyet Ekonomisi,, 11.11.

256 Ibid.,Ibid., 1515..

257 IbIbiidd., ., 1717..

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views, their works for him present a whole integrity and are must reads

views, their works for him present a whole integrity and are must reads for those who really intend to learn economics. for those who really intend to learn economics.

Dobretsberger, alth

Dobretsberger, although he was the successor of Röpkeough he was the successor of Röpke,, wrwroteote a a completely different book in content. In his completely different book in content. In his Ekonomi SiyasetiEkonomi Siyaseti, he mainly , he mainly focuses on economic policy with an effort to define it as a branch of sci-focuses on economic policy with an effort to define it as a branch of sci-ence and emphasizes the importance of it in a country like Turkey ence and emphasizes the importance of it in a country like Turkey with with respect to the countries that have already established the production respect to the countries that have already established the production device. The pedagogic aim of the book is presented as to prepare the device. The pedagogic aim of the book is presented as to prepare the future economic policy makers to serve for the prosperity of the coun-future economic policy makers to serve for the prosperity of the coun-try. The purpose of the economic policy fortry. The purpose of the economic policy for him, is not only explaining him, is not only explaining the economic phenomenon of a single unitthe economic phenomenon of a single unit,, but the fundamental fields but the fundamental fields in world economics. Chapters begin with the task of economic policy, its in world economics. Chapters begin with the task of economic policy, its presence in economic science and its methods, ideologies and the tools presence in economic science and its methods, ideologies and the tools of implementatof implementation. Next, he focuses on agricultural policies, housing ion. Next, he focuses on agricultural policies, housing policies, infant industry/industrpolicies, infant industry/industrializationialization policies and internal com-policies and internal com-merce policies. Obviously, this book cannot be characterized as an in-merce policies. Obviously, this book cannot be characterized as an in-troductory economics textbooktroductory economics textbook;; though, as he was the successorthough, as he was the successor of of Röpke, it is meaningful to notice how the Röpke, it is meaningful to notice how the corecore agendas of both econo-agendas of both econo-mists differ. Ironically, the Austrian tone in the German Wilhelm Röpke’s mists differ. Ironically, the Austrian tone in the German Wilhelm Röpke’s voice is much more evident than the Austrian Dobretsbergervoice is much more evident than the Austrian Dobretsberger’s’s..

As for the basic introduction to economics textb

As for the basic introduction to economics textbooks in the 1940s, ooks in the 1940s, we should zoom into Neumark’s book. In the 1we should zoom into Neumark’s book. In the 1stst fascicule of the 1fascicule of the 1stst vol-vol-ume of ume of Umumi İktisat TeorisiUmumi İktisat Teorisi, Neumark presents the characters of eco-, Neumark presents the characters of eco-nomic actions (national economy, different economic systems, history of nomic actions (national economy, different economic systems, history of economic thought, the classification and method in economics), the economic thought, the classification and method in economics), the natural, legal and social conditions of economic life. Inatural, legal and social conditions of economic life. In the 2n the 2ndnd fascicule, fascicule, he focuses on needs and consumption, the relations between the factors he focuses on needs and consumption, the relations between the factors of production (labor, land, capital). In the 2of production (labor, land, capital). In the 2ndnd volume, he elaborates on volume, he elaborates on economic mechanism and dynamics, value and price theories. In the 2economic mechanism and dynamics, value and price theories. In the 2ndnd fascicule, he explaifascicule, he explains the productional and distributional issues at great ns the productional and distributional issues at great length (wage, interest, rent and profit). Lastly, he examines the conjunc-length (wage, interest, rent and profit). Lastly, he examines the conjunc-tures and depressions. This comprehensive book establishes a substan-tures and depressions. This comprehensive book establishes a substan-tial theoretical framework enriched by tial theoretical framework enriched by variousvarious references inreferences in each chap-each chap-ter.ter.

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The chapters in Suvla’s book

The chapters in Suvla’s book Umumi İktisat Dersleri: Nazari İktisatUmumi İktisat Dersleri: Nazari İktisat show similarities with Neumark’s, as elaborations show similarities with Neumark’s, as elaborations arare ordered by the e ordered by the introduction to economics, then production, value, money and price, the introduction to economics, then production, value, money and price, the distribution of national income,distribution of national income, conjunctures and depressions, econom-conjunctures and depressions, econom-ic methodology and history of economic science. In the preface, he men-ic methodology and history of economic science. In the preface, he men-tions that in tions that in the the first version of the book in 1945, there was no place for first version of the book in 1945, there was no place for methodological and doctrinal issues; conjuncture and depressions were methodological and doctrinal issues; conjuncture and depressions were slislightly touched as well. Yet, in the 1949 version we have, all these is-ghtly touched as well. Yet, in the 1949 version we have, all these is-sues are comprehensively presented. sues are comprehensively presented. EEven so, throughout the book, one ven so, throughout the book, one can feel that he meticulously avoids from being a party of a theory. As can feel that he meticulously avoids from being a party of a theory. As for the discursiveness, there is little changfor the discursiveness, there is little change between Suvla, Neumark e between Suvla, Neumark and Röpke. The statistical data about the conjunctures and current eco-and Röpke. The statistical data about the conjunctures and current eco-nomic parameters in Turkey was occasionally utilizednomic parameters in Turkey was occasionally utilized;; neverthelessnevertheless,, the the graphics only appear in the chapter on price determination. Yet, he graphics only appear in the chapter on price determination. Yet, he dwells upon the signidwells upon the significance of mathematical and psychological meth-ficance of mathematical and psychological meth-ods.ods.258 Referring to Pirou, he claims that the most elegant way of ex-Referring to Pirou, he claims that the most elegant way of ex-plaining economic equilibrium in the framework of abstraction meth-plaining economic equilibrium in the framework of abstraction meth-ods is the mathematical examinations ods is the mathematical examinations ofof Walras, Pareto and their Walras, Pareto and their followers, afollowers, as they present the most inspirational and comprehensible s they present the most inspirational and comprehensible imagination about the relations of interconnectedness in between the imagination about the relations of interconnectedness in between the parts of economics. According to him, all sciences would transform into parts of economics. According to him, all sciences would transform into being more mathematical as they arrive at a certain evolutbeing more mathematical as they arrive at a certain evolutionary level; ionary level; there is no reason to reject this possibility for the economic science as there is no reason to reject this possibility for the economic science as well. However, he also annotateswell. However, he also annotates thatthat mathematics is like a mill, the mathematics is like a mill, the product it yields depends on the material endued. The abstraction product it yields depends on the material endued. The abstraction method is very useful for who womethod is very useful for who would like to visualize the economic uld like to visualize the economic mechanism as a whole; yet it is not capable of solving any specific prob-mechanism as a whole; yet it is not capable of solving any specific prob-lem just by itself. The progress in the mathematical economics is based lem just by itself. The progress in the mathematical economics is based on the robustness of the relations extracted by the observations on eco-on the robustness of the relations extracted by the observations on eco-nomic nomic realities in advance. These examinations for him, should be car-realities in advance. These examinations for him, should be car-ried out in compliance with the positive method, and based on the ob-ried out in compliance with the positive method, and based on the ob-

258 These models are based on the deductive method, indeed.These models are based on the deductive method, indeed.

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servations on real markets by the help of statistics and question-

servations on real markets by the help of statistics and question-naires.naires.259

A remarkable finding is that

A remarkable finding is that,, almost all these bookalmost all these books are intrigued s are intrigued with the issues of microeconomics. Macroeconomics, as it is conceptual-with the issues of microeconomics. Macroeconomics, as it is conceptual-ized todayized today,, was not really elaborated in a detailed mannerwas not really elaborated in a detailed manner except the except the chapters on moneychapters on money..260 Another observation is that the audienceAnother observation is that the audiencess of of these books these books areare depicted as the Turdepicted as the Turkish economics students. The au-kish economics students. The au-thors don’t expose their textbooks for universal recognition or they thors don’t expose their textbooks for universal recognition or they don’t intend to produce universally valid claims, at least at the textbook don’t intend to produce universally valid claims, at least at the textbook level. A common ground for these books can be summarized as an effort level. A common ground for these books can be summarized as an effort to introducto introduce the basic elements of economic science by drawing out the e the basic elements of economic science by drawing out the current tendencies. They generally avoid from being doctrinaire.current tendencies. They generally avoid from being doctrinaire.261

The i

The importance of remaining neutral against different theoretical mportance of remaining neutral against different theoretical approaches is also emphasized in Şükrü Baban’s approaches is also emphasized in Şükrü Baban’s İktisat İlminin Uİktisat İlminin Umumi mumi PrensipleriPrensipleri. He claims in the preface that even he remained faithful to . He claims in the preface that even he remained faithful to the principles that take place in the old publications, the principles that take place in the old publications, it isit is importanimportant not t not to beto be stuck in any theory or doctrinestuck in any theory or doctrine.. FFor him, a professor is neither a or him, a professor is neither a cult leader nor a propagandistcult leader nor a propagandist of an argument and he would like the of an argument and he would like the students not to be influenced by the ideas of the professor but develop students not to be influenced by the ideas of the professor but develop their own perspectives. He draws a parallel between the collision of their own perspectives. He draws a parallel between the collision of ideas ideas --flux and refluxflux and reflux-- and he says that only the peaceful flurries are and he says that only the peaceful flurries are reflereflected in the book. The most controversial concepts like value, labor, cted in the book. The most controversial concepts like value, labor, capital and wage which drift the viewpoints apartcapital and wage which drift the viewpoints apart,, will be identified will be identified within the objectivity of a photographer, in his words. Without putting within the objectivity of a photographer, in his words. Without putting

259 Suvla, Suvla, Nazari, Nazari, 330330, cited in, cited in Pirou, 172Pirou, 172..

260 Referring to Fisher, the quantity theory of money was mentiReferring to Fisher, the quantity theory of money was mentioned in Suvla’s book. oned in Suvla’s book. Suvla,Suvla, Nazari, Nazari, 179179--183. Suvla wrote a book on 183. Suvla wrote a book on Money and CreditsMoney and Credits in the 1960s. In ad-in the 1960s. In ad-dition, Baban says that the second volume of his book is expected to set place to mone-dition, Baban says that the second volume of his book is expected to set place to mone-tary theory and policies, principles of banking and national incotary theory and policies, principles of banking and national income and employment. me and employment. Baban, Baban, İktisad, İktisad, vii. vii. Yet, this book cannot be accessedYet, this book cannot be accessed. I. In the library of Istanbul Univer-n the library of Istanbul Univer-sity, there is only the first volume of the book which is elaborated in this chapter.sity, there is only the first volume of the book which is elaborated in this chapter.

261 Yet, Röpke often alludes to communism and socialismYet, Röpke often alludes to communism and socialism in a negative manner. His in a negative manner. His appraisappraisal for the capitalist system as the best system for our country is voiced fre-al for the capitalist system as the best system for our country is voiced fre-quently.quently.

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much emphasis on the opinions of different ec

much emphasis on the opinions of different ecoles, the results are to be oles, the results are to be enlisted.enlisted.262 The concern for objectivity is most apparent in Baban’sThe concern for objectivity is most apparent in Baban’s263 book with respect to other textbooks. This might be related with the fact book with respect to other textbooks. This might be related with the fact thatthat,, as a professor who had academic training Frenchas a professor who had academic training French--speaking Swit-speaking Swit-zerland zerland andand initialinitially an opponent of the modernization policiesly an opponent of the modernization policies264, he , he might have felt himself to display more sensitivity might have felt himself to display more sensitivity forfor bebeinging objectiveobjective as as much as possiblemuch as possible..

The array of chapters in Baban’s book is not really different from Su-

The array of chapters in Baban’s book is not really different from Su-vla’s book. First, he handles the subject mavla’s book. First, he handles the subject matter of economic science, the tter of economic science, the nature of economic laws, definitions of basic concepts and debates on nature of economic laws, definitions of basic concepts and debates on value and price. Next, he discusses about price making policies in per-value and price. Next, he discusses about price making policies in per-fect/imperfect competition and under monopolistic conditions. After-fect/imperfect competition and under monopolistic conditions. After-math, the nature anmath, the nature and principles of distribution take place as the shares d principles of distribution take place as the shares were defined as rent, wage, interest and profit. were defined as rent, wage, interest and profit.

A significant thing that attracts the attention in Baban’s book is that

A significant thing that attracts the attention in Baban’s book is that he elaborates more on the analytical part by drawing curves and using he elaborates more on the analytical part by drawing curves and using mathematicmathematical formulas.al formulas.265 He says that without disregarding the fact He says that without disregarding the fact that this book is written for students of economics and law, he allocated that this book is written for students of economics and law, he allocated some place to the mathematics flow which started to take place in many some place to the mathematics flow which started to take place in many

262 Baban, Baban, İktisad, İktisad, vv..

263 The economics professor Baban came from a rich Baghdadian family whose members The economics professor Baban came from a rich Baghdadian family whose members have been from lieutenant governors, mudarris, assembly of notablehave been from lieutenant governors, mudarris, assembly of notables, parliamentari-s, parliamentari-an, journalists and newspaperman. He worked in Egypt High Border of Commissions an, journalists and newspaperman. He worked in Egypt High Border of Commissions and he was participated to the committee sent to Brest Litowsk Peace Treaty in 1918. and he was participated to the committee sent to Brest Litowsk Peace Treaty in 1918. Cihad Baban, “Hocam ve Amcam Şükrü Baban,” in Cihad Baban, “Hocam ve Amcam Şükrü Baban,” in Ord. Prof. Şükrü Baban’a ArmaOrd. Prof. Şükrü Baban’a Armağanğan (İstanbul: İstanbul Üniversitesi İktisat Fakültesi, 1984): 5(İstanbul: İstanbul Üniversitesi İktisat Fakültesi, 1984): 5--8. 8. He completed his books He completed his books namely namely Applied Economics (Tatbikî İktisat)Applied Economics (Tatbikî İktisat) in in 1941 and 1941 and Courses on Economics (İktisat Courses on Economics (İktisat Dersleri)Dersleri) in in 1942. He was known as a intelligent and humoristic1942. He was known as a intelligent and humoristic professor with aprofessor with a com-com-pelling characterpelling character.. http://iktisat.istanbul.edu.tr/?p=6520http://iktisat.istanbul.edu.tr/?p=6520

264 EgeEge and and HagemannHagemann, , “The Modernisation“The Modernisation,” ,” 2121..

265 In the preface of the book, he appreciates Besim Üstünel for his help in utilization of In the preface of the book, he appreciates Besim Üstünel for his help in utilization of Anglosaxon economic sources, which gives us an idea abouAnglosaxon economic sources, which gives us an idea about the content and method of t the content and method of the book.the book. Baban, Baban, İktisad,İktisad, viiiviii..

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textbooks in

textbooks in currentcurrent times.times.266 Yet, when contemplating oYet, when contemplating on these nuanc-n these nuanc-es, es, oneone should keep in mind the different conjunctures in between the should keep in mind the different conjunctures in between the years of publication of each book. Baban’s book was published in 1957 years of publication of each book. Baban’s book was published in 1957 while Neumark’s was in 1940 and Röpke’s 1937. Baban in the preface of while Neumark’s was in 1940 and Röpke’s 1937. Baban in the preface of his book claims that economic scihis book claims that economic scienceence ––unlike another social science unlike another social science like lawlike law–– has shown an alteration in the last thirty years. When we has shown an alteration in the last thirty years. When we compare this textbook with the ones published twenty years before, the compare this textbook with the ones published twenty years before, the difference is difference is totoo apparent to be overlooked. Another feature that makes o apparent to be overlooked. Another feature that makes Baban’s bBaban’s book different from the formers is that, there is almost no men-ook different from the formers is that, there is almost no men-tion ontion on thethe peculiarities of Turkey.peculiarities of Turkey. The reader doesn’tThe reader doesn’t see an effort to see an effort to establish a dialogue between establish a dialogue between the the content of chapters with the current content of chapters with the current economic data or the conditions in Turkey. If this economic data or the conditions in Turkey. If this would have been a would have been a book written in book written in ananother language, nobody would think that it was tar-other language, nobody would think that it was tar-geted to Turkish economics students. Thisgeted to Turkish economics students. This situationsituation points outpoints out a real a real changechange,, indeed. Although still very far from a neoclassical synthesis, the indeed. Although still very far from a neoclassical synthesis, the tendency of distancing thtendency of distancing the discourse from the local specialties in this e discourse from the local specialties in this book seems like a breaking point.book seems like a breaking point.

Consequently, if

Consequently, if one one would like to locate the experience of Turkey would like to locate the experience of Turkey somewhere around the experiences of somewhere around the experiences of the previously the previously mentioned coun-mentioned coun-tries, tries, it might be saidit might be said that the tendency ithat the tendency in Turkey resembles Spain with n Turkey resembles Spain with respect to the emphasis on Gide’s book and the translation of the mate-respect to the emphasis on Gide’s book and the translation of the mate-rials based on the priorities of national economy within a country spe-rials based on the priorities of national economy within a country spe-cific focuscific focus.. IIt resembles Germany as there was an ambiguity between t resembles Germany as there was an ambiguity between the historical schthe historical school and neoclassical doctrine for a whileool and neoclassical doctrine for a while. I. It resembles t resembles Scandinavia and the US in keeping Keynesian paradigm in the back-Scandinavia and the US in keeping Keynesian paradigm in the back-ground till the 1950sground till the 1950s. I. It resembles France as the economics education t resembles France as the economics education

266 Baban,Baban, İktisad, İktisad, viivii. During the period Baban’s textbook was published, the use of . During the period Baban’s textbook was published, the use of mathematics started to be increased in research especially in the faculties and colleges mathematics started to be increased in research especially in the faculties and colleges of the Anglosaxon countries as they want their economics students tof the Anglosaxon countries as they want their economics students to be economic o be economic experts and to have a more comprehensive knowledge on mathematical skills. Moreo-experts and to have a more comprehensive knowledge on mathematical skills. Moreo-ver, from the point of views of the econometricians, statistical and mathematical ver, from the point of views of the econometricians, statistical and mathematical methods are conceived as the only scientific way in terms of their emphasis on mmethods are conceived as the only scientific way in terms of their emphasis on meas-eas-urability as a prerequisite of scienceurability as a prerequisite of science..

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was designed to enlighten a new society in a revolutionary period

was designed to enlighten a new society in a revolutionary period and it and it resembles Portugalresembles Portugal in terms ofin terms of changing the traditional way of econom-changing the traditional way of econom-ics teaching withics teaching withinin a revolutionary reform.a revolutionary reform.

One last point

One last point:: Until here, Until here, I wasI was totally concerned with what was totally concerned with what was presented by the academics throughpresented by the academics through thethe textbooks and journals. Yet, textbooks and journals. Yet, ththere is another question as important as ere is another question as important as thisthis: what was received by : what was received by the students? Thus, it would be meaningful to give an ear to the con-the students? Thus, it would be meaningful to give an ear to the con-siderations of a student in Istanbul University from 1946 to 1950 siderations of a student in Istanbul University from 1946 to 1950 who later became a professor there. The memoirs of Gültwho later became a professor there. The memoirs of Gülten Kazgan, en Kazgan, providesprovides usefuluseful insights. She says that they were graduated from insights. She says that they were graduated from the the economics department, without observing a demand or supply curve, economics department, without observing a demand or supply curve, or an equilibrium price. Although Neumark taught them about the or an equilibrium price. Although Neumark taught them about the theory of necessities, Kazgan claims that it wtheory of necessities, Kazgan claims that it was not really associated as not really associated with prices. They (the students) heard the rent theory and compara-with prices. They (the students) heard the rent theory and compara-tive advantages theory of Ricardotive advantages theory of Ricardo,, but not but not the name of the name of Keynes till the Keynes till the senior year.senior year.267

A transformation in the curriculum of the faculty of economics

A transformation in the curriculum of the faculty of economics happened as the Ahappened as the Anglonglo--Saxon ecole came up by the new generation Saxon ecole came up by the new generation says Kazgan.says Kazgan.268 The translations of the textbooks used in the US and The translations of the textbooks used in the US and the arrival of Samuelson’s the arrival of Samuelson’s Introduction to Economics Introduction to Economics by Demir by Demir Demirgil’s translation made it possible to ground economics on a Demirgil’s translation made it possible to ground economics on a holistic base fholistic base for her, which she defines as a turning point for stu-or her, which she defines as a turning point for stu-dents. She says that what they had learned were like islets in ocean, dents. She says that what they had learned were like islets in ocean, till that translation; which shaped the way and instruments of their till that translation; which shaped the way and instruments of their thinking. Only at that time, economics was divided into macroeco-thinking. Only at that time, economics was divided into macroeco-

267 Kazgan, Kazgan, Bir İktisatçının, Bir İktisatçının, 13. An13. An interesting anecdote interesting anecdote Kazgan mentions is that Kazgan mentions is that Refii Refii Şükrü Suvla was telling that he was unfamiliar with the Keynesian theory, although he Şükrü Suvla was telling that he was unfamiliar with the Keynesian theory, although he was a foreign trade and monetary economics specialist.was a foreign trade and monetary economics specialist. Ibid.,Ibid., 1133..

268 Kazgan, Kazgan, Bir İktisatçının,Bir İktisatçının, 1155--16. 16. This generation, endowed by a new intellect, consisted This generation, endowed by a new intellect, consisted academic figures like academic figures like Oktay Yenal, İbrahim Öngüt, Sencer DivitçioğluOktay Yenal, İbrahim Öngüt, Sencer Divitçioğlu andand İdris İdris Küçükömer. Besides, it is important to note that Kazgan’s emphasis on the necessity of Küçükömer. Besides, it is important to note that Kazgan’s emphasis on the necessity of having a comprehensive knowhaving a comprehensive knowledge about neoclassical economics does not mean that ledge about neoclassical economics does not mean that she is an advocate of that ideology but the presence of a desire to relate the theories she is an advocate of that ideology but the presence of a desire to relate the theories and concepts within a more scientific framework.and concepts within a more scientific framework.

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nomics, microeconomics and international economics; by the utiliza-omics, microeconomics and international economics; by the utiliza-tion of new analytical tools and equations, the analytical power of tion of new analytical tools and equations, the analytical power of education was increased. Kazgan states that their studentship lasted education was increased. Kazgan states that their studentship lasted so longso long, , even after their graduationeven after their graduation, , because she and because she and her fellows her fellows were graduated without learning all thesewere graduated without learning all these thingsthings..269

269 Kazgan, Kazgan, BirBir İktisatçınınİktisatçının, , 1313--1616.. Consequently, she says that hConsequently, she says that her book er book İktisadi Düşünceİktisadi Düşünce is is a collection of the lecture notes of her on welfare economics, price theory, conjuncture a collection of the lecture notes of her on welfare economics, price theory, conjuncture and economic growth.and economic growth.

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4 Public FinancePublic Finance

Public finance is a manifestation of the interface

Public finance is a manifestation of the interface between the state and the citizen. It reflects the between the state and the citizen. It reflects the dominant political philosophy in any one country dominant political philosophy in any one country aand the consequent entitlements to state assis-nd the consequent entitlements to state assis-tance as well as responsibilities for selftance as well as responsibilities for self--support. support. It supports pursuit of objectives in respect of eq-It supports pursuit of objectives in respect of eq-uity, efficiency, economy and effectiveness. It im-uity, efficiency, economy and effectiveness. It im-pacts upon the rate or economic growth and so pacts upon the rate or economic growth and so affects not jaffects not just the distribution of income and ust the distribution of income and wealth but also the absolute level of material wealth but also the absolute level of material standards of living. Public finance is synonymous standards of living. Public finance is synonymous with public policy writ large. A strategic ap-with public policy writ large. A strategic ap-proach to public finance requires the analyst to proach to public finance requires the analyst to take a holistic view, recogniztake a holistic view, recognizing that the whole is ing that the whole is greater than the sum of the individual partsgreater than the sum of the individual parts..270

270 Stephen JStephen J. . Bailey, “Public Finance: Political Philosophy, Economic Theory and PracticeBailey, “Public Finance: Political Philosophy, Economic Theory and Practice,,” ” İstanbul Üniversitesi İkİstanbul Üniversitesi İktisat Fakültesi Maliye Araştırmaları Merkezi Konferanslarıtisat Fakültesi Maliye Araştırmaları Merkezi Konferansları 52, 52, ((20092009):): 190190..

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n today’s economics education, the courses on public finance appear

n today’s economics education, the courses on public finance appear for two semesters across the curriculum and since that curriculum is for two semesters across the curriculum and since that curriculum is mostly shaped by the neoclassical understanmostly shaped by the neoclassical understanding, models and methods; ding, models and methods; the content of the public finance courses is mostly microthe content of the public finance courses is mostly micro--based instead based instead of being dominated by a socioof being dominated by a socio--economic analysis within a macro per-economic analysis within a macro per-spective. This is not surprising when we consider the strong relation spective. This is not surprising when we consider the strong relation between the content ofbetween the content of education and education and the the dominant ideologydominant ideology, , or the or the center wherein the knowledge produced has that disseminative power; center wherein the knowledge produced has that disseminative power; though one might have expected to come up with more a macrothough one might have expected to come up with more a macro--based based perspective when it is the case of public finance, at least for the perspective when it is the case of public finance, at least for the sake of sake of tthe he naming of the concept. Even so, the existence of such a relation ori-naming of the concept. Even so, the existence of such a relation ori-ents us to think that the position of public finance in economics educa-ents us to think that the position of public finance in economics educa-tion might have undergone some changes within different contexts or tion might have undergone some changes within different contexts or periods. periods. While While presentpresentinging how the discipline ohow the discipline of economicsf economics waswas evolved evolved since the foundation of the faculty of economics till the midsince the foundation of the faculty of economics till the mid--sixties in sixties in this dissertation, it would be meaningful to contemplate on whether the this dissertation, it would be meaningful to contemplate on whether the weight and content of public finance weight and content of public finance werewere similar during that period in similar during that period in our country or our country or not. For instance, what was understood from public fi-not. For instance, what was understood from public fi-nance in the early years of the 20nance in the early years of the 20thth century? What would one expect to century? What would one expect to see in a textbook on public finance in the 1930s or the 1940s Turkey? In see in a textbook on public finance in the 1930s or the 1940s Turkey? In what ways the academic approaches on public finance might hwhat ways the academic approaches on public finance might have been ave been transformed in the 1950s or the 1960s, both in the world and in Turkey, transformed in the 1950s or the 1960s, both in the world and in Turkey, when we think of the possible interactions? Figuring out some answers when we think of the possible interactions? Figuring out some answers for these questions might help us to construct an illustrative framework for these questions might help us to construct an illustrative framework for the intellectual atmosphere for the intellectual atmosphere during the years elaborateduring the years elaborated in this dis-d in this dis-sertationsertation..

So, in this chapter, how the theories and policies on public finance

So, in this chapter, how the theories and policies on public finance were conceptualized via the textbooks and journal articles in the two were conceptualized via the textbooks and journal articles in the two classical universities during the early years of the classical universities during the early years of the RRepublicepublic will will be ex-be ex-aminedamined. Under what conditions the fiscal approaches were shaped and . Under what conditions the fiscal approaches were shaped and who appeared as the agents of the construction/localization of the field who appeared as the agents of the construction/localization of the field of public finance in academy will be elaborated. The reception of public of public finance in academy will be elaborated. The reception of public

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finance, the conceptualizations of th

finance, the conceptualizations of the academics in fiscal issues and the e academics in fiscal issues and the possible divergences from other countries will reveal both the intellec-possible divergences from other countries will reveal both the intellec-tual and traditional peculiarities of this country. Contemplating on the tual and traditional peculiarities of this country. Contemplating on the reasons why some theoretical themes are more frequent in the articles reasons why some theoretical themes are more frequent in the articles and sand seeing the moving parts in their perspectives in the course of eeing the moving parts in their perspectives in the course of events would hopefully come up with eyeevents would hopefully come up with eye--opening inferences. The ut-opening inferences. The ut-tered policy prescriptions by academics will present the dimensions of tered policy prescriptions by academics will present the dimensions of their theoretical perceptions which might open new horizotheir theoretical perceptions which might open new horizons for articu-ns for articu-lating the Turkish experience into other developing and developed lating the Turkish experience into other developing and developed countries of the current period.countries of the current period.

Three points are discerned in this research. The first is the relation

Three points are discerned in this research. The first is the relation between public finance and economics, whether public finance should between public finance and economics, whether public finance should be cobe considered within the laws of economic science or not. This is also nsidered within the laws of economic science or not. This is also related with to what degree public finance occurs as an independent related with to what degree public finance occurs as an independent branch. The stance of a theory branch. The stance of a theory visvis--àà--visvis this problematic also has reflec-this problematic also has reflec-tions on the policy implementations as it also detions on the policy implementations as it also determines the bounda-termines the bounda-ries of state intervention into the economy. The second is the envisions ries of state intervention into the economy. The second is the envisions of the academics on the role of state in stimulating economic fields. The of the academics on the role of state in stimulating economic fields. The third point is a stretchedthird point is a stretched--out version of these two points indeed, which out version of these two points indeed, which refers to the prerefers to the preference between the classical and modern public fi-ference between the classical and modern public fi-nance theories. A quest on when and why one of these approaches be-nance theories. A quest on when and why one of these approaches be-come predominant in the academia would portray a theoretical map of come predominant in the academia would portray a theoretical map of the reception in time.the reception in time.

In the following parts, the emergence of public f

In the following parts, the emergence of public finance, the meaning inance, the meaning and main constituents of the concept and the basic theoretical ap-and main constituents of the concept and the basic theoretical ap-proaches that designate the role of state in economyproaches that designate the role of state in economy will be elaboratedwill be elaborated. . Next, the Turkish fiscal experience and how issues related with public Next, the Turkish fiscal experience and how issues related with public finance were handled at thefinance were handled at the policy levelpolicy level will be examinedwill be examined. The central . The central role of state and to what degree fiscal policies were utilized as useful role of state and to what degree fiscal policies were utilized as useful instruments in stimulating economy for the given period will be pre-instruments in stimulating economy for the given period will be pre-sented. Then, sented. Then, the focus will be oriented tothe focus will be oriented to the academic texts, textbookthe academic texts, textbooks s and articlesand articles,, to see how fiscal issues were considered by the academics to see how fiscal issues were considered by the academics in Turkey. The writings of the prominent academic figures specialized in in Turkey. The writings of the prominent academic figures specialized in public finance will be presented and which facets of the current theories public finance will be presented and which facets of the current theories

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they

they mostmost embarked on will be examiembarked on will be examined. The decennary changes in the ned. The decennary changes in the public finance interpretations and the main fiscal agendas of that dec-public finance interpretations and the main fiscal agendas of that dec-ades will be revealed accordingly.ades will be revealed accordingly.

In the end, a clear analysis on the dimensions of the reception of

In the end, a clear analysis on the dimensions of the reception of dominant fiscal theories and approaches in a develdominant fiscal theories and approaches in a developing country like oping country like TurkeyTurkey will be hopefully presentedwill be hopefully presented. In line with the other chapters of . In line with the other chapters of this dissertation, the reception of public finance theories is primarily this dissertation, the reception of public finance theories is primarily shaped by the shifts in the centers wherein the hegemonic knowledge is shaped by the shifts in the centers wherein the hegemonic knowledge is produced, since the thproduced, since the theoretical flows erupted from the new center eoretical flows erupted from the new center spread around and extendspread around and extendeded its expectations to a new economic order. its expectations to a new economic order. Yet, just as impressive as this, is the remarkable influence of psychologi-Yet, just as impressive as this, is the remarkable influence of psychologi-cal and cultural norms of a country cal and cultural norms of a country iin determining what would be em-n determining what would be em-brbraced or filtered out from these theories. This chapter, together with aced or filtered out from these theories. This chapter, together with the chapters on social policy and development economics would be bet-the chapters on social policy and development economics would be bet-ter considered as integral parts of a whole, related with each other with-ter considered as integral parts of a whole, related with each other with-in organic ties which are also connected to tin organic ties which are also connected to the Keynesian impact and he Keynesian impact and the shift from microeconomics to macroeconomics in the corresponding the shift from microeconomics to macroeconomics in the corresponding years. And this organic whole would illuminate the main concerns of years. And this organic whole would illuminate the main concerns of economics discipline during the first 30economics discipline during the first 30--35 years period in the Republi-35 years period in the Republi-can Turkey.can Turkey.

§ 4.1 HistoricalHistorical Development of Public Finance and Fiscal Development of Public Finance and Fiscal TheoriesTheories

In considering the historical development of public finance, it would be

In considering the historical development of public finance, it would be useful to begin with thinking on the etymology of the word since the useful to begin with thinking on the etymology of the word since the transforming perceptions on the themes like finance and tax catransforming perceptions on the themes like finance and tax can be fol-n be fol-lowed by an evocatory baggage of different meanings attached to them. lowed by an evocatory baggage of different meanings attached to them. For instance, it might be surprising to learn that the word “finance” was For instance, it might be surprising to learn that the word “finance” was indeed rooted from the Latin infinitive “finare”, which first meant the indeed rooted from the Latin infinitive “finare”, which first meant the

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“provision of the judge” (hakimi

“provision of the judge” (hakimin hükmü) then used for the payment n hükmü) then used for the payment obligations as a result of that edict.obligations as a result of that edict.271 The label “finance” was employed The label “finance” was employed by by the French in the forthcoming period, when they meant to refer for the French in the forthcoming period, when they meant to refer for public economy management; while this concept was considered ex-public economy management; while this concept was considered ex-tendable by Gertendable by Germans when referring to private entrepreneurship. Yet, mans when referring to private entrepreneurship. Yet, the English and French manifested the form of the English and French manifested the form of finance publique, public finance publique, public financefinance in making mention of state finance.in making mention of state finance.272 That is to say, in addition That is to say, in addition to temporal transformations, there were also semantic diffto temporal transformations, there were also semantic differences in erences in between different nations. between different nations.

As for the concept of tax, we should again go back a long way; since

As for the concept of tax, we should again go back a long way; since it is claimed that the notion of tax occupied a significant place since the it is claimed that the notion of tax occupied a significant place since the year zero.year zero.273 Beside the implementations borrowed from the Roman Beside the implementations borrowed from the Roman and Egypand Egyptian civilizations; today’s tax system is supposed to be founded tian civilizations; today’s tax system is supposed to be founded by the Europeans due to the increase in public needs in the 16by the Europeans due to the increase in public needs in the 16thth and and the the 1717thth centuries when the regular military service began.centuries when the regular military service began.274 The etymolo-The etymolo-gy of the concept of “tax”, similar with the concegy of the concept of “tax”, similar with the concept of “finance”pt of “finance”,, reflects reflects the evolution it was exposed to. First, it had a discretionary nature, it the evolution it was exposed to. First, it had a discretionary nature, it was like a gift, a donation.was like a gift, a donation.275 For instance, the word “tributum” which For instance, the word “tributum” which means extortion today, was signifying “donum” in Latin, and “benevo-means extortion today, was signifying “donum” in Latin, and “benevo-lence/grant” in Frelence/grant” in French during the medieval era; and transformed into nch during the medieval era; and transformed into “precarium” in Latin and “bede” in German which impl“precarium” in Latin and “bede” in German which implies ies request. In request. In the following centuries, the word connotated the concepts like “subsi-the following centuries, the word connotated the concepts like “subsi-dy” or “steuer” which referred to notions like help, assistance and cdy” or “steuer” which referred to notions like help, assistance and col-ol-lectivism. Words like “gabelle, abgabe and dazio”, inferring altruism or lectivism. Words like “gabelle, abgabe and dazio”, inferring altruism or selfself--sacrifice, were generally witnessed during the least centuries of the sacrifice, were generally witnessed during the least centuries of the modern age.modern age.276 The word “impot” takes its roots from compelling, which The word “impot” takes its roots from compelling, which

271 MuhlisMuhlis Ete, “Finans İlmine Ete, “Finans İlmine Bir Giriş,Bir Giriş,”” İÜHFMİÜHFM 1, no. 2 (1, no. 2 (19351935): ): 161161..

272 IIbidbid., ., 162162.. This concept was used as equivalent to state income as late as the 18This concept was used as equivalent to state income as late as the 18thth century in Germany.century in Germany.

273 İbrahim Fazılİbrahim Fazıl PelinPelin, , “Verginin Tarihsel Evrimi ve Doğu Batı Arasında bu Husustaki “Verginin Tarihsel Evrimi ve Doğu Batı Arasında bu Husustaki MüvazilikMüvazilik,,” ” İÜHFMİÜHFM 11, , no. 4 (no. 4 (19351935): ): 404.404.

274 PelinPelin, , “Verginin Tarihsel“Verginin Tarihsel,” 404.,” 404.

275 Fritz Fritz Neumark, Neumark, Maliyeye Dair TetkiklerMaliyeye Dair Tetkikler (İstanbul: İsmail Akgün Matbaası,(İstanbul: İsmail Akgün Matbaası, 19481948),), 2626..

276 Pelin, Pelin, “Verginin Tarihsel“Verginin Tarihsel,,”” 404404--405.405.

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is a characteristic feature of tax to

is a characteristic feature of tax today; and the concepts like “taxe” or day; and the concepts like “taxe” or “auflage” were encountered in the 16“auflage” were encountered in the 16thth and and the the 1717thth centuries.centuries.277 In pro-In pro-gress of time, it turned out to be considered as a political compulsion gress of time, it turned out to be considered as a political compulsion and a legal obligation.and a legal obligation.278

After this brief historical introduction, it would b

After this brief historical introduction, it would be meaningful to see e meaningful to see what was understood from public finance during the 18what was understood from public finance during the 18thth, 19, 19thth and 20and 20thth centuries, when also the discipline economics in modern sense was centuries, when also the discipline economics in modern sense was born and evolved. Particularly for these centuries, it can be said that the born and evolved. Particularly for these centuries, it can be said that the theorizations on publictheorizations on public finance have gone hand in hand with the theori-finance have gone hand in hand with the theori-zations on the roles of state. In this direction, what also necessarily be-zations on the roles of state. In this direction, what also necessarily be-comes a central subject matter of this chapter is an examination on the comes a central subject matter of this chapter is an examination on the various conceptualizations on state over time. Jean Marchal frovarious conceptualizations on state over time. Jean Marchal from Nancy m Nancy University LawUniversity Law FacultyFaculty, in his translated , in his translated article “Mali İktisadın Mahiyeti article “Mali İktisadın Mahiyeti ve Muhtevası”, draws us a road map by elaborating on the changing ve Muhtevası”, draws us a road map by elaborating on the changing roles of state, both chronologically and ideologically.roles of state, both chronologically and ideologically.279 Annotating Annotating Smith and Quesnay, he starts with liberalism and mentions that state Smith and Quesnay, he starts with liberalism and mentions that state was not a law maker was not a law maker (legisfacteur) but it played a legislative role (legis-(legisfacteur) but it played a legislative role (legis-lateur) in physiocracy; which means it was not entitled to intervene the lateur) in physiocracy; which means it was not entitled to intervene the property or money.property or money.280 It was like a “gendarme” state which was envi-It was like a “gendarme” state which was envi-sioned as quite a weak economic organism to produce any effect osioned as quite a weak economic organism to produce any effect on n economy via its budget. It was not supposed to dominate the market; on economy via its budget. It was not supposed to dominate the market; on the contrary, it was expected to remain under the influence of the mar-the contrary, it was expected to remain under the influence of the mar-ket.ket.281 AccordinglyAccordingly –– and ideallyand ideally –– the public expenditures were highly the public expenditures were highly limited and inflation was strictly condemnelimited and inflation was strictly condemned. The only principle was d. The only principle was considered as the provision of the equilibrium, namely the annual considered as the provision of the equilibrium, namely the annual

277 Pelin, “Verginin TarihselPelin, “Verginin Tarihsel,” ,” 403403--405405, cited in, cited in Seligman, Seligman, Essai sur l’impotEssai sur l’impot, 7, 7--99; Fritz ; Fritz NeumarkNeumark, , Maliyeye DairMaliyeye Dair TetkiklerTetkikler ((İstanbul: İstanbul Üniversitesi, 1948),İstanbul: İstanbul Üniversitesi, 1948), 2626..

278 Neumark, Neumark, Maliyeye DairMaliyeye Dair,, 2727..

279 This article was transThis article was translated in the journal of lated in the journal of SBFSBF so might also be regarded as a primary so might also be regarded as a primary source. Yet, this article was selected to portray the historical change since it briefly and source. Yet, this article was selected to portray the historical change since it briefly and clearly presents the changing perceptions on state in an objective manner. clearly presents the changing perceptions on state in an objective manner.

280 Jean Marchal, “MaJean Marchal, “Mali İktisadın Mahiyeti ve Muhtevasıli İktisadın Mahiyeti ve Muhtevası,,” translated by İsmail Hakkı ” translated by İsmail Hakkı Ülkmen, Ülkmen, AÜSBFAÜSBFDD 6, no. 1 (6, no. 1 (1951951): 124.1): 124.

281 Ibid.,Ibid., 124124..

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budget equilibrium.

budget equilibrium.282 As for taxation, state behavior was characterized As for taxation, state behavior was characterized as timid, it was regarded to be backwards about coming forward when as timid, it was regarded to be backwards about coming forward when demanding taxes.demanding taxes.283 BrieflyBriefly, the notion of state , the notion of state wawas considered and ide-s considered and ide-alized as neutral in the classical approach of public finance. A small and alized as neutral in the classical approach of public finance. A small and balanced budget balanced budget wawas appreciated, taxes that may harm the private sav-s appreciated, taxes that may harm the private sav-ings should be eliminated and consumption ings should be eliminated and consumption waswas to be taxed. All these to be taxed. All these principles reflect a tendency which assumes that state pretends to be-principles reflect a tendency which assumes that state pretends to be-have as a private individualhave as a private individual284 and the fiscal issues were treated by the and the fiscal issues were treated by the classical economists with the eye of “homo economicus.”classical economists with the eye of “homo economicus.”285

During the early 19

During the early 19thth century, Marchal says that state wascentury, Marchal says that state was a mere a mere spectator against the economic phenomenon and the uttermost respon-spectator against the economic phenomenon and the uttermost respon-sibility of state was to draw a cadre for the economic phenomena. Yet, sibility of state was to draw a cadre for the economic phenomena. Yet, there occurred some signs for a change especially in the second half of there occurred some signs for a change especially in the second half of the 19the 19thth century. As the role of socialcentury. As the role of social policy in taxation increased, public policy in taxation increased, public debt and state expenditures began to be increased.debt and state expenditures began to be increased.286 The intervention-The intervention-ist method in which the budget is considered as an influential instru-ist method in which the budget is considered as an influential instru-ment for economy became prominent. In accordance with the expan-ment for economy became prominent. In accordance with the expan-sion of public incsion of public income and expenditures, the scope of state was extended ome and expenditures, the scope of state was extended in the conjunctural conditions of the 1920s till the Great Depression. in the conjunctural conditions of the 1920s till the Great Depression. Even so, Marchal claims that a reliance on the automatic mechanisms of Even so, Marchal claims that a reliance on the automatic mechanisms of economics was still there, despite all the help state provideconomics was still there, despite all the help state provided for the ed for the poor and helpless people during that current period.poor and helpless people during that current period.287 It was then like It was then like a “divine” state (ilahi devlet)a “divine” state (ilahi devlet)288, mostly characterized by such philan-, mostly characterized by such philan-thropic activities; which makes us think of an absence of a permanent thropic activities; which makes us think of an absence of a permanent shift in the institutional structurshift in the institutional structure of state.e of state.

282 Marchal, “Mali İktisadınMarchal, “Mali İktisadın,,”” 125125--126126..

283 Namık ZiyaNamık Ziya Aral, “Aral, “19431943--1944 Bütçesi, 1944 Bütçesi, Mali VaziyetMali Vaziyet--Nakdi VaziyetNakdi Vaziyet,,” ” AÜSBFAÜSBFDD 1, no. 2 1, no. 2 ((19431943):): 290290. Nam. Namık Ziya Aral is the father of Rahşan Ecevit and advisor in the Central ık Ziya Aral is the father of Rahşan Ecevit and advisor in the Central Bank. Sadun Aren, Bank. Sadun Aren, Puslu Camın ArkasındanPuslu Camın Arkasından (Ankara: İmge Kitabevi, 2006),(Ankara: İmge Kitabevi, 2006), 75.75.

284 Atilla Atilla Karaosmanoğlu, “Fonksiyonel MaliyeKaraosmanoğlu, “Fonksiyonel Maliye,,”” AÜSBFAÜSBFDD 10, no. 3 (1955):10, no. 3 (1955): 3939..

285 Ete, “Finans İlmineEte, “Finans İlmine,” ,” 174174..

286 Ibid.,Ibid., 174174..

287 Marchal, “Mali İktisadınMarchal, “Mali İktisadın,,”” 127.127.

288 Ibid., 128.Ibid., 128.

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The breaking point was the Great Depression. Since the Great Depres-

The breaking point was the Great Depression. Since the Great Depres-sion, the economic actions of state have been oriented to a struggle sion, the economic actions of state have been oriented to a struggle against inflation and deflation, which also pointagainst inflation and deflation, which also pointeded out a change in the out a change in the nature of public finance.nature of public finance.289 From thenFrom then on, state was considered as an on, state was considered as an institution that should meet the expectations like providing welfare, institution that should meet the expectations like providing welfare, putting an end to economic depression and making necessary institu-putting an end to economic depression and making necessary institu-tional reforms.tional reforms.290 In line with this, budget was even more acknowledged In line with this, budget was even more acknowledged as an influential as an influential instrument and the impact of budget on economy was instrument and the impact of budget on economy was not only conceded, but also requested.not only conceded, but also requested.291 And the most critical trans-And the most critical trans-formation was probably this. The cherished principles of classical doc-formation was probably this. The cherished principles of classical doc-trine remained incapable of resolving the problems and by dint of thtrine remained incapable of resolving the problems and by dint of the e Keynesian revolution, the assumptions of the classical school were high-Keynesian revolution, the assumptions of the classical school were high-ly disfavored. Savings, from then on, were not principally assumed equal ly disfavored. Savings, from then on, were not principally assumed equal to investments. According to the Keynesian model, income and spending to investments. According to the Keynesian model, income and spending were regarded as the two facets of the swere regarded as the two facets of the same thing. In this sense, reduc-ame thing. In this sense, reduc-ing consumption was not appreciated as it may result in a decline of the ing consumption was not appreciated as it may result in a decline of the national income. Then, for the revival of economy, the prerequisite was national income. Then, for the revival of economy, the prerequisite was propounded as an increase in the effective demand, which can’t be ma-propounded as an increase in the effective demand, which can’t be ma-terialized vterialized via the automatic mechanisms of the “selfia the automatic mechanisms of the “self--regulating” market. regulating” market. In this direction, government spending was expected to be increased In this direction, government spending was expected to be increased during the recessions or bust periods and the concept of “deficing fi-during the recessions or bust periods and the concept of “deficing fi-nancing” began to be regarded among the duties of state.nancing” began to be regarded among the duties of state.292 Thereby, the Thereby, the cyclic budget theory was ensued with a necessary departure from the cyclic budget theory was ensued with a necessary departure from the classical doctrine which equated the steady and healthy policies with classical doctrine which equated the steady and healthy policies with the ideal of an annual balanced budget. From then on, responsibilities the ideal of an annual balanced budget. From then on, responsibilities

289 KaraosmanoğluKaraosmanoğlu, , “Fonksiyonel Maliye“Fonksiyonel Maliye,,” 41” 41..

290 Marchal, “Mali İktisadınMarchal, “Mali İktisadın,” ,” 132132.. Here, we should keep in mind that Marchal is an author Here, we should keep in mind that Marchal is an author who doesn’t lean towards the liberal ideas. Yet this is nwho doesn’t lean towards the liberal ideas. Yet this is not surprising when we think of ot surprising when we think of the French tradition the French tradition withwithin which in which the discipline of the discipline of economics couldn’t gain independ-economics couldn’t gain independ-ence from law for a long time.ence from law for a long time.

291 Ibid., Ibid., 133133..

292 Karaosmanoğlu, Karaosmanoğlu, “Fonksiyonel Maliye,” “Fonksiyonel Maliye,” 4040--4141..

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like the financing of public servi

like the financing of public services and full employment of factors of ces and full employment of factors of production came into prominence for state.production came into prominence for state.293

§ 4.2 Implementations of Public Finance and Financial Pol-Implementations of Public Finance and Financial Pol-icies in Turkeyicies in Turkey

“It is not possible to elucidate a country’s social and economic structure,

“It is not possible to elucidate a country’s social and economic structure, military power and basic himilitary power and basic historical phenomenon, without knowing that storical phenomenon, without knowing that country’s tax system, financial administration and organization, its country’s tax system, financial administration and organization, its budget, wage regime, monetary policies and the nature of the financial budget, wage regime, monetary policies and the nature of the financial crisis it experienced.”crisis it experienced.”294 claimed economic historian Ömer Lütfi Barkan. claimed economic historian Ömer Lütfi Barkan. As As for a healthy interpretation of an economic conjuncture, he even for a healthy interpretation of an economic conjuncture, he even drdrew ew an analogy between scrutinizing on the public budget and feeling an analogy between scrutinizing on the public budget and feeling a patient’s pulse to measure the tension and heat of social organism.a patient’s pulse to measure the tension and heat of social organism.295 Obviously, theObviously, the corecore matter of this chapter is not matter of this chapter is not a presentation of a presentation of a a chronological fiscal datachronological fiscal data;; yet, these words are worth mentioning for yet, these words are worth mentioning for demonstrating the acknowledged significance of public finance and its demonstrating the acknowledged significance of public finance and its linkages with social world by such an expert.linkages with social world by such an expert. On account of thisOn account of this, begin-, begin-ning with a brief introducning with a brief introduction on the fiscal policies implemented in Tur-tion on the fiscal policies implemented in Tur-key would be helpful in seeing the background and tracing the reasons key would be helpful in seeing the background and tracing the reasons of theoretical translations in corresponding periods.of theoretical translations in corresponding periods.

It is obvious that public finance in Turkey was not characterized by a

It is obvious that public finance in Turkey was not characterized by a strong claim fostrong claim for conventionalism, since there were no concerns about r conventionalism, since there were no concerns about budget till the Tanzimat Era.budget till the Tanzimat Era.296 The concept of “budget” was even not The concept of “budget” was even not well established in the minds of the bureaucratic elites, which signifies well established in the minds of the bureaucratic elites, which signifies

293 Neumark, “Devri BütçeNeumark, “Devri Bütçe,,” translated by Osman O” translated by Osman Okyar, kyar, İÜİFM İÜİFM 9, no. 19, no. 1--2 (2 (19471947): ): 24. 24.

294 Ömer Lütfi Barkan, “Osmanlı İmparatorluğu Bütçelerine Dair NotlarÖmer Lütfi Barkan, “Osmanlı İmparatorluğu Bütçelerine Dair Notlar,,” ” İÜİFMİÜİFM 15, no. 115, no. 1--44 ((19531953):): 238238..

295 IbIbid., id., 238238..

296 IbidIbid., ., 244244..

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the presence of a distance from being a modern state which h

the presence of a distance from being a modern state which has income as income and expenditure accounts arranged in a rational and diligent manner. and expenditure accounts arranged in a rational and diligent manner. YetYet,, in the late 18in the late 18thth and the 19and the 19thth centurycentury,, aa need for change occurred need for change occurred when income began to fall short of the expenses due to changing con-when income began to fall short of the expenses due to changing con-junctural conditions. Thereby, the Ottojunctural conditions. Thereby, the Ottoman experience in the 19man experience in the 19thth centu-centu-ry ry –– during when the Ottoman economy was articulated to the capitalist during when the Ottoman economy was articulated to the capitalist world order in a dependent way via huge debts and foreign investmentsworld order in a dependent way via huge debts and foreign investments –– signifies an effort for modernization in collecting taxes in a rational signifies an effort for modernization in collecting taxes in a rational manner bamanner based on personal income. Even so, the binary between the tax sed on personal income. Even so, the binary between the tax farming farming and “muhassıl” and “muhassıl” (tax collector) (tax collector) systemsystem and the difficulties in es-and the difficulties in es-timating the potential tax income due to the lack of statistical data all timating the potential tax income due to the lack of statistical data all resulted in a very unproductive and insufficient rresulted in a very unproductive and insufficient revenue stream to the evenue stream to the treasury. There occurred huge budget deficits in anticipation of being treasury. There occurred huge budget deficits in anticipation of being compensated by the debts, although taking on new debts became diffi-compensated by the debts, although taking on new debts became diffi-cult due to the dead loans. After the declaration of bankruptcy, Düyuncult due to the dead loans. After the declaration of bankruptcy, Düyun--u u UmumiyeUmumiye (Ottoman Public (Ottoman Public Debt Administration)Debt Administration) was founded by for-was founded by for-eigners as another vein of dependency to pay for the debts via directly eigners as another vein of dependency to pay for the debts via directly collecting the almost the 1/3 of taxes in the last quarter of the century. collecting the almost the 1/3 of taxes in the last quarter of the century. Indeed, DüyunIndeed, Düyun--u Umumiye not only functioned as an institutional ex-u Umumiye not only functioned as an institutional ex-tenstension of the economic dependency, but also it left a significant im-ion of the economic dependency, but also it left a significant im-pression on the minds of the bureaucrats with the modern organiza-pression on the minds of the bureaucrats with the modern organiza-tional mechanism it represents for. The modern budget understanding tional mechanism it represents for. The modern budget understanding has more rapidly evolved both by the presence of such an ihas more rapidly evolved both by the presence of such an institution at nstitution at the heart of the capital the heart of the capital ––and maybe by witnessing its attainment in tax and maybe by witnessing its attainment in tax collectioncollection–– and the accompanying impacts of the modernization at-and the accompanying impacts of the modernization at-tempts in educational policies at the corresponding period. With the tempts in educational policies at the corresponding period. With the transforming power of the educationaltransforming power of the educational reforms, the concepts like state reforms, the concepts like state and economy began to be interpreted in a more secular and abstract and economy began to be interpreted in a more secular and abstract level. level. At this pointAt this point, the timing is important in the sense that this quarter , the timing is important in the sense that this quarter of the century corresponds the birth of the generation who would of the century corresponds the birth of the generation who would be be the the foundfoundeers ofrs of the the RRepublic after a few decades. This generation with a epublic after a few decades. This generation with a more developed modern budget understanding in mind, was more re-more developed modern budget understanding in mind, was more re-sponsive to the problems stemming from the lack of fiscal discipline and sponsive to the problems stemming from the lack of fiscal discipline and the deferment of fiscal problems and these neverthe deferment of fiscal problems and these never--toto--bebe--foforgotten mem-rgotten mem-

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ories have shaped their ways of discernment. They were under the im-

ories have shaped their ways of discernment. They were under the im-pression that a central reason behind this extraordinary destruction pression that a central reason behind this extraordinary destruction they witnessed in the last period of the empire, was the presence of they witnessed in the last period of the empire, was the presence of budget deficits and economic dependency.budget deficits and economic dependency.

It is not surprising then the young

It is not surprising then the young RRepublicans, preferred a set of epublicans, preferred a set of policies which prioritized establishing a selfpolicies which prioritized establishing a self--sufficient independent sufficient independent economy instead of maintaining the existing Ottoman tradition. In line economy instead of maintaining the existing Ottoman tradition. In line with the economic historian Korkut Boratav’s pwith the economic historian Korkut Boratav’s periodizationeriodization in in Türkiye Türkiye İktisat Tarihi, 1908İktisat Tarihi, 1908--1981985 (Turkey’s Economic History, 19085 (Turkey’s Economic History, 1908--1985)1985), the , the years between 1923years between 1923--1929 refer to the reestablishment of the economy 1929 refer to the reestablishment of the economy within open economy conditions. In this period, a crucial fiscal reform within open economy conditions. In this period, a crucial fiscal reform for the rural populatifor the rural population took place: Tithe and Cattle on took place: Tithe and Cattle TTax were abolished ax were abolished and indirect taxes were levied on the consumption goods of the urban and indirect taxes were levied on the consumption goods of the urban population instead. After the Great Depression, economic policy orien-population instead. After the Great Depression, economic policy orien-tation has changed. Turkey switches to protectionism (1929tation has changed. Turkey switches to protectionism (1929--1932) an1932) and d éétatism (1932tatism (1932--1939), within which state occurs as the central produc-1939), within which state occurs as the central produc-tive and investor agent in the economy. Influenced by the memories of tive and investor agent in the economy. Influenced by the memories of high inflation and dependency of a continuous elevenhigh inflation and dependency of a continuous eleven--yearyearss warwar –– to-to-gether with the earlier Ottoman fiscal experiencegether with the earlier Ottoman fiscal experience remembered for a remembered for a heavy debt burdenheavy debt burden –– the Republicans emphasized on “balanced budget the Republicans emphasized on “balanced budget and hard currency” and achieved their goal of balanced budget for most and hard currency” and achieved their goal of balanced budget for most of the time.of the time.297 The governments were prudent, they consciously didn’t The governments were prudent, they consciously didn’t utilize the option of creating autilize the option of creating additional resource by printing money or dditional resource by printing money or stirring up budget deficits. In other words, as economic historian Şevket stirring up budget deficits. In other words, as economic historian Şevket Pamuk puts it, the Keynesian policies before Keynes were not imple-Pamuk puts it, the Keynesian policies before Keynes were not imple-mented in Turkey. Although the share of public income and expendi-mented in Turkey. Although the share of public income and expendi-tures of sttures of state in GDP was increased till the end of the 1930s, additional ate in GDP was increased till the end of the 1930s, additional

297 Mahfi Eğilmez, Mahfi Eğilmez, Değişim Sürecinde Türkiye: Osmanlı’dan Cumhuriyet’e Sosyoekonomik Değişim Sürecinde Türkiye: Osmanlı’dan Cumhuriyet’e Sosyoekonomik Bir Bir DeğerlendirmeDeğerlendirme (İstanbul: (İstanbul: Remzi Kitabevi,Remzi Kitabevi, 20182018): 139.): 139. TThe country experienced a he country experienced a budget deficitbudget deficit oonly for once till nly for once till the the 1930s; except that, there was a %01930s; except that, there was a %0..2 surplus in the 2 surplus in the budget in generalbudget in general. .

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expenses via budget deficits were avoided.

expenses via budget deficits were avoided.298 Inflation was also avoided Inflation was also avoided and credit policies of the banks were mostly conservative. Even the ex-and credit policies of the banks were mostly conservative. Even the ex-change rate policy was not utilized as an instrumentchange rate policy was not utilized as an instrument against the reces-against the reces-sion. Hence, sion. Hence, neitherneither the fiscal andthe fiscal and nornor monetary policies can be defined monetary policies can be defined as expansionary in the 1930s Turkey.as expansionary in the 1930s Turkey.299

If the foundation of the

If the foundation of the RRepublic is one revolutionary breaking point, epublic is one revolutionary breaking point, the Wthe World orld WWar ar II was the second. The years between 1939 II was the second. The years between 1939 and 1945 and 1945 indicated a state of emergency. The supply and demand equilibrium indicated a state of emergency. The supply and demand equilibrium deteriorated during the war. Increasing production and decreasing con-deteriorated during the war. Increasing production and decreasing con-sumption were among the obligatory measuressumption were among the obligatory measures;; however, no provisions however, no provisions were made for increasing production, and evewere made for increasing production, and even the n the fivefive--year industriali-year industriali-zation program was interrupted. The increasing defense expenditures zation program was interrupted. The increasing defense expenditures resulted in budget deficits. Inflation was skyrocketed since only a very resulted in budget deficits. Inflation was skyrocketed since only a very small part of this deficit could be financed bysmall part of this deficit could be financed by thethe implementation of implementation of additional taxes.additional taxes.300 Profiteering occurred and the taxation system was Profiteering occurred and the taxation system was deprived of the means that would retouch the disproportionalities in deprived of the means that would retouch the disproportionalities in redistribution of income. Capital Tax Law in 1942, was implemented redistribution of income. Capital Tax Law in 1942, was implemented forfor taxtaxinging the undeserved gains during the warthe undeserved gains during the war; ; yetyet, it, it mostly embarkmostly embarked on ed on the nonthe non--Muslim community.Muslim community.301 Soil Products Tax, which was like the Soil Products Tax, which was like the return of Tithe return of Tithe –– although it was technically and ontologically different although it was technically and ontologically different from itfrom it –– was applied while the national defense spending increased in was applied while the national defense spending increased in 19431943,, although the revenue earned from talthough the revenue earned from this tax was indeed low and his tax was indeed low and

298 ŞevketŞevket Pamuk, Pamuk, Türkiye’nin 200 Yıllık İktisadi TarihiTürkiye’nin 200 Yıllık İktisadi Tarihi (İstanbul: (İstanbul: Türkiye İş Bankası Kültür Türkiye İş Bankası Kültür Yayınları, Yayınları, 2014): 2014): 191191..

299 Ibid.,Ibid., 194194..

300 Ibid.,Ibid., 200200..

301 The incontestable tax assessment was determined in the absence of a strong statistical The incontestable tax assessment was determined in the absence of a strong statistical data.data.

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costs were high.

costs were high.302 Hence, in addition to emergence of blackHence, in addition to emergence of black--market, a market, a black “accounting” appeared.black “accounting” appeared.303

By the end of the W

By the end of the World War orld War II, new approaches to fiscal issues II, new approaches to fiscal issues shaped by the dynamics of the Cold War came to agenda. shaped by the dynamics of the Cold War came to agenda. The The MarshalMarshall l Aid triggered agricultural productivity particularly for the first half of Aid triggered agricultural productivity particularly for the first half of the 1950sthe 1950s,, which contributed to economic growth. However, by the ad-which contributed to economic growth. However, by the ad-verse conditional changes and the macroeconomic policy preferences of verse conditional changes and the macroeconomic policy preferences of the Democrats; monetary expansion and inflthe Democrats; monetary expansion and inflationary flows were wit-ationary flows were wit-nessed afterwards.nessed afterwards.304 By the 1960s, the developmental concerns be-By the 1960s, the developmental concerns be-came more a part of the economic agenda. Planning is institutionalized came more a part of the economic agenda. Planning is institutionalized by the foundation of State Planning Organization. The intersection set of by the foundation of State Planning Organization. The intersection set of development economics anddevelopment economics and public finance grew and how and in what public finance grew and how and in what ways the elements of fiscal policy might contribute to economic devel-ways the elements of fiscal policy might contribute to economic devel-opment turned out to be one of the main subject matters in economics.opment turned out to be one of the main subject matters in economics.

§ 4.3 The Conceptual Framework for Public Finance in Ac-The Conceptual Framework for Public Finance in Ac-ademiaademia

In this part of

In this part of the chapter, the writings and policy suggestions of the the chapter, the writings and policy suggestions of the academics that signify the theoretical approaches adopted by them will academics that signify the theoretical approaches adopted by them will be examined. An analysis on to what degree the local particularities in-be examined. An analysis on to what degree the local particularities in-fluence the teaching of public finance and the financial pfluence the teaching of public finance and the financial policies pre-olicies pre-scribed by the academics via the textbooks, conference reports and scribed by the academics via the textbooks, conference reports and journal articles will constitute the main body of this section. journal articles will constitute the main body of this section. With the With the

302 Suad Suad Başar, “Toprak MahsulleriBaşar, “Toprak Mahsulleri Vergisi Kalkınca,Vergisi Kalkınca,”” İÜİFMİÜİFM 77, , no. 1no. 1--4 (1945):4 (1945): 104104--105105. . Başar mentions that aBaşar mentions that although agricultural income was 48 lthough agricultural income was 48 percentpercent of total income, the of total income, the remittances were just 8.5 remittances were just 8.5 percentpercent. Even that rate weighed a heavy burden. Even that rate weighed a heavy burden,, particularly particularly for for the the villagers.villagers.

303 Pamuk, Pamuk, Türkiye’nin 200 YıllıkTürkiye’nin 200 Yıllık, , 164164..

304 Ibid., Ibid., 232232..

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intent

intent to understand the visions of the academics, to understand the visions of the academics, II will focus on the will focus on the interrelated themes that are interrelated themes that are the rthe relation between “public finance” and elation between “public finance” and “economics” which determines the rules of the functioning of public “economics” which determines the rules of the functioning of public finance, the theoretical approaches the academics embarked upon re-finance, the theoretical approaches the academics embarked upon re-lated with budgetary, taxation and spending issues which all constitute lated with budgetary, taxation and spending issues which all constitute their inferentheir inferences on theces on the role of the state in economy and their conceptu-role of the state in economy and their conceptu-alizations on the most suitable framework for public finance, based on alizations on the most suitable framework for public finance, based on the peculiarities of Turkey.the peculiarities of Turkey.

In one of his articles on the evolution of economic policies

In one of his articles on the evolution of economic policies in Turkey, in Turkey, Mahfi Eğilmez claimed that the center of gravity was on fiscal policies Mahfi Eğilmez claimed that the center of gravity was on fiscal policies until the 1970s; monetary policiesuntil the 1970s; monetary policies,, on the other hand, were only con-on the other hand, were only con-sidered as complementary.sidered as complementary.305 Zafer Toprak in a conversation even Zafer Toprak in a conversation even claimed that thinking of economy had littlclaimed that thinking of economy had little difference from thinking of e difference from thinking of public finance especially for the early years of the public finance especially for the early years of the RRepublic; that is to epublic; that is to say the weight of public finance was so central that almost all the ap-say the weight of public finance was so central that almost all the ap-proaches regarding economic phenomena were shaped within a public proaches regarding economic phenomena were shaped within a public finance frameworfinance framework then.k then.306 This might be because of the fact that the This might be because of the fact that the central problem in economic destruction was attributed to the previous central problem in economic destruction was attributed to the previous weakness of financial comprehension; therefore, foundation of a ration-weakness of financial comprehension; therefore, foundation of a ration-al fiscal structure turned out to be among the most immediate cal fiscal structure turned out to be among the most immediate concerns oncerns in economic policies. Rather than using monetary instruments like in economic policies. Rather than using monetary instruments like emission (foremission (for thethe fear of inflation) or interest/currency apparatus (en-fear of inflation) or interest/currency apparatus (en-acting the protection of the value of Turkish currency while most of the acting the protection of the value of Turkish currency while most of the countries devaluate their own currencicountries devaluate their own currencies) in overcoming economic es) in overcoming economic troubles, fiscal measures came to the forefront in management of econ-troubles, fiscal measures came to the forefront in management of econ-omy.omy.

Indeed, one can see the repercussions of this situation also in the ac-

Indeed, one can see the repercussions of this situation also in the ac-ademic sphere, within a retrospective analysis on the formation of the ademic sphere, within a retrospective analysis on the formation of the discipline of discipline of economics in Turkey. When the Faculty of Economics in economics in Turkey. When the Faculty of Economics in Istanbul University was founded, public finance was appointed as one of Istanbul University was founded, public finance was appointed as one of the constitutive chairs. This builtthe constitutive chairs. This built--in presence of public finance and so-in presence of public finance and so-

305 https://www.mahfiegilmez.com/2013/01/ekonomihttps://www.mahfiegilmez.com/2013/01/ekonomi--politikasnnpolitikasnn--evrimi.html.evrimi.html.

306 Zafer Toprak (2020) Personal communicationZafer Toprak (2020) Personal communication..

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cial economics

cial economics, , which will be discussed in the fourth chawhich will be discussed in the fourth chapter, indicates pter, indicates that economics was to some extent conceived as a policythat economics was to some extent conceived as a policy--centered dis-centered dis-cipline instead of science with natural laws cipline instead of science with natural laws –– with the exception of the with the exception of the general economics textbooks through which the theoretical approach general economics textbooks through which the theoretical approach lies at the center of gravitylies at the center of gravity ––.. Although a detailed portrayal of the theo-Although a detailed portrayal of the theo-retical arguments was also present among the textbooks and articles, retical arguments was also present among the textbooks and articles, apparently the decisive role of the national idiosyncrasies constrained apparently the decisive role of the national idiosyncrasies constrained the authors from being tied to a theory blindly. And the dominant atti-the authors from being tied to a theory blindly. And the dominant atti-tudtude of the academics in reception of the theories on public finance can e of the academics in reception of the theories on public finance can be summarized by Fritz Neumark’s words that be summarized by Fritz Neumark’s words that areare “the significance lev-“the significance lev-el of a public finance theory in practice is determined by the actual sta-el of a public finance theory in practice is determined by the actual sta-tus of that theory in real life.”tus of that theory in real life.”307

As in the

As in the case of the whole economics education, what is primarily case of the whole economics education, what is primarily worth attention on this subject is the effort for invention of a local tradi-worth attention on this subject is the effort for invention of a local tradi-tion on public finance. The two prominent textbooks serve for that pur-tion on public finance. The two prominent textbooks serve for that pur-posepose areare Finans İlmiFinans İlmi by İbrahim Fazıl Pelin, publishby İbrahim Fazıl Pelin, published in 1937ed in 1937--1942 and 1942 and Maliyeye Dair TetkiklerMaliyeye Dair Tetkikler by the émigré professor Fritz Neumark pub-by the émigré professor Fritz Neumark pub-lished in 1948. Indeed, before them, Hasan Tahsin Aynizade’s lished in 1948. Indeed, before them, Hasan Tahsin Aynizade’s İlmi Maliİlmi Mali was written in 1914 and Hasan Saka’s was written in 1914 and Hasan Saka’s Maliye Ders NotlarıMaliye Ders Notları in 1936, Fadıl in 1936, Fadıl HH. Sur’s . Sur’s Maliye DersleriMaliye Dersleri308 alalso incapsulated various approaches on pub-so incapsulated various approaches on pub-lic finance.lic finance.

Concerning the transformations in approach, it is worth to dwell up-

Concerning the transformations in approach, it is worth to dwell up-on İbrahim Fazıl Pelin and his on İbrahim Fazıl Pelin and his Finans İlmi. Finans İlmi. Pelin was sent to Paris for Pelin was sent to Paris for educational purposes in 1911, which proves the current weight oeducational purposes in 1911, which proves the current weight of f French iFrench influence nfluence on social sciences. He studied both on social sciences. He studied both in in the Ecoles des the Ecoles des Hautes Etudes and Sciences PolitiqueHautes Etudes and Sciences Politique309 and was influencedand was influenced byby Bergson, Bergson,

307 Neumark, “Konjonktürel Bir Bütçe Açığı Karşısında Devletin VaziyetiNeumark, “Konjonktürel Bir Bütçe Açığı Karşısında Devletin Vaziyeti,,” translated by ” translated by Orhan Dikmen, Orhan Dikmen, İÜİFM, İÜİFM, no. 1 (no. 1 (19391939):): 362362..

308 Neumark Neumark in his review of this book states that the author bases his theoretical in his review of this book states that the author bases his theoretical explanations about the budgetary issues on explanations about the budgetary issues on classical theories. Fritz Neumark. Review classical theories. Fritz Neumark. Review of of Maliye DersleriMaliye Dersleri, by Fadıl Sur. , by Fadıl Sur. İÜİFMİÜİFM, (1946): 128., (1946): 128.

309 Ziyaüddin FahriZiyaüddin Fahri Fındıkoğlu, “Profesör İbraFındıkoğlu, “Profesör İbrahim Fazıl Pelin Üzerindeki Fikri Tesirlere him Fazıl Pelin Üzerindeki Fikri Tesirlere DairDair,,” ” İÜİFMİÜİFM 11, 11, no. no. 11--22 ((19451945):): 1212..

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Gide but more importantly

Gide but more importantly byby the young professor Gaston Jezethe young professor Gaston Jeze,, who who played a significant role in featuring the relatplayed a significant role in featuring the relation between public law ion between public law and public finance, when public finance was still supposed to be a prop-and public finance, when public finance was still supposed to be a prop-erty of economists.erty of economists.310 Pelin’s Pelin’s Finans İlmiFinans İlmi carried on the spirit of Jeze, carried on the spirit of Jeze, both contentwise and methodologically.both contentwise and methodologically.311 Broadly speaking, this spirit Broadly speaking, this spirit was a reflection of a comprehension that includes not only the facts re-was a reflection of a comprehension that includes not only the facts re-lated with pure finance and economy, but also the political, social andlated with pure finance and economy, but also the political, social and legal factors in analyzing the financial phenomenon. According to this legal factors in analyzing the financial phenomenon. According to this perception, the current intricacy of the causality relations among the perception, the current intricacy of the causality relations among the social phenomena can only be solved by a sociological viewpoint and social phenomena can only be solved by a sociological viewpoint and each social science is expected to explicate each social science is expected to explicate the phenomenon in a view-the phenomenon in a view-point that prioritizepoint that prioritizess the question of “what the question of “what ought to beought to be” instead of ” instead of ““what iswhat is..”” Such an understanding is set forth as the distinguishing char-Such an understanding is set forth as the distinguishing char-acteristic of the modern social science for Jeze.acteristic of the modern social science for Jeze.312 And Pelin, whose the-And Pelin, whose the-oretical heritage reoretical heritage reflects Jeze’s revolutionary conceptualization of pub-flects Jeze’s revolutionary conceptualization of pub-lic finance with a special emphasis on the sociological viewpoint was lic finance with a special emphasis on the sociological viewpoint was appointed to the head of Finance and Act of Financing in the Faculty of appointed to the head of Finance and Act of Financing in the Faculty of Economics and had a longEconomics and had a long--lasting impact in the faculty.lasting impact in the faculty.

Yet, t

Yet, to narrow the content that best fits to the framework of this dis-o narrow the content that best fits to the framework of this dis-sertation, Neumark’s insightful sertation, Neumark’s insightful Maliyeye Dair TetkiklerMaliyeye Dair Tetkikler313 will be exam-will be exam-

310 Fındıkoğlu, “Profesör İbrahim Fındıkoğlu, “Profesör İbrahim Fazıl,” Fazıl,” 1313..

311 IbIbiidd., ., 1818..

312 Ibid., Ibid., 1616--1717..

313 TThis book is a highly valuable source for this dissertation which focuses on the his book is a highly valuable source for this dissertation which focuses on the theoretical sidtheoretical side of the subject mattere of the subject matter which which also also reflects the contextual difference reflects the contextual difference between the earlier and the recent public finance textbooks. Yet, such an evolution is between the earlier and the recent public finance textbooks. Yet, such an evolution is not peculiar for Turkey. As for a representative textbook, Harley L. Lutz’s not peculiar for Turkey. As for a representative textbook, Harley L. Lutz’s Public Fi-Public Fi-nance nance can be ecan be examined. Harvey Rosen’s articlexamined. Harvey Rosen’s article on the changes in the textbooks of pub-on the changes in the textbooks of pub-lic finance lic finance reveals the differences in methodological approaches and substance be-reveals the differences in methodological approaches and substance be-tween Lutz’s booktween Lutz’s book on public financeon public finance and hisand his (Rosen’s)(Rosen’s) book that is written 50 years book that is written 50 years after it. He first coafter it. He first compares the definition of the concept and says that Lutz’s definition mpares the definition of the concept and says that Lutz’s definition included “financial administration which has a lot to do with governmental admin-included “financial administration which has a lot to do with governmental admin-istration” although the current field deals with these issues on abstraction level that istration” although the current field deals with these issues on abstraction level that narrows the framewonarrows the framework of public finance. Lutz’s book hasn’t any single diagram, while rk of public finance. Lutz’s book hasn’t any single diagram, while the current has dozens of it. The author asserts that public finance appeared to be the current has dozens of it. The author asserts that public finance appeared to be

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ined as

ined as thethe central material for the construction of a tradition in the central material for the construction of a tradition in the university. Fritz Neumark was an economist who was university. Fritz Neumark was an economist who was respected for hav-respected for hav-ing dealt with macroeconomic issues in his early writings even before ing dealt with macroeconomic issues in his early writings even before Keynes, in the opinion of Musgrave, one of the distinguished professors Keynes, in the opinion of Musgrave, one of the distinguished professors on public finance.on public finance.314 It won’t be wrong to say that Neumark, as the head It won’t be wrong to say that Neumark, as the head of General Economics and Pof General Economics and Public Finance Theory, is the predecessor of ublic Finance Theory, is the predecessor of the following generations of public finance and economics professors. the following generations of public finance and economics professors. His theoretical viewpoints, enhanced by comparative analysis combin-His theoretical viewpoints, enhanced by comparative analysis combin-ing the theoretical and practical affairs in ing the theoretical and practical affairs in variousvarious countries, helps to secountries, helps to see e the situation the situation inin Turkey in an explicit manner. Therefore, together with Turkey in an explicit manner. Therefore, together with the articles published the articles published in in İstanbul Üniversitesi İktisat Fakültesi Mecmuası, İstanbul Üniversitesi İktisat Fakültesi Mecmuası, İstanbul Üniversitesi Maliye Araştırmaları Merkezi Konferanslarıİstanbul Üniversitesi Maliye Araştırmaları Merkezi Konferansları (İstan-(İstan-bull University Journal of Public Fbull University Journal of Public Finance Studies)inance Studies) and Ankara Üniversitesi and Ankara Üniversitesi Siyasal Bilgiler Fakültesi DergisiSiyasal Bilgiler Fakültesi Dergisi (Ankara University SBF Journal(Ankara University SBF Journal,, related related with the analysis on the abovementioned themes; the leading figure of with the analysis on the abovementioned themes; the leading figure of

more of a stand

more of a stand--alone domain 50 years ago. It encompasses the fundamentals of rele-alone domain 50 years ago. It encompasses the fundamentals of rele-vant theories but does vant theories but does not really believe that they can be utilized in search of not really believe that they can be utilized in search of how the how the distribution of income can be affected by taxes. Lutz’s book allocates long and tedious distribution of income can be affected by taxes. Lutz’s book allocates long and tedious sections on taxonomy but lefts very little room on measurement and data, which will sections on taxonomy but lefts very little room on measurement and data, which will again be reversed again be reversed in the book written 50 years after. Discussion of institutional and in the book written 50 years after. Discussion of institutional and historical issues that presents a survey of fiscal doctrine is taken seriously and consti-historical issues that presents a survey of fiscal doctrine is taken seriously and consti-tute and extensive part in Lutz’s, although the current author doesn’t engage into such tute and extensive part in Lutz’s, although the current author doesn’t engage into such explanationexplanations as there is only one way of thinking in public finance problems. In Lutz’s s as there is only one way of thinking in public finance problems. In Lutz’s book, social security, maintenance of environmental quality, redistribution problems, book, social security, maintenance of environmental quality, redistribution problems, political economy issues received no systematic attention while his book devoted sub-political economy issues received no systematic attention while his book devoted sub-stantial stantial sections for them. The author claims that the selection of the topics are heavily sections for them. The author claims that the selection of the topics are heavily influenced by the current agenda of the day. The detailed explanations on the issues influenced by the current agenda of the day. The detailed explanations on the issues that are ignored today is linked to the “changing role of the academic public finance that are ignored today is linked to the “changing role of the academic public finance ecoeconomists”. Rosen, Harvey S. “The Way We Were (And Are): Changes in Public Fi-nomists”. Rosen, Harvey S. “The Way We Were (And Are): Changes in Public Fi-nance and Its Textbooks.”nance and Its Textbooks.” National Tax JournalNational Tax Journal, vol. 50, no. 4, (1997): 719, vol. 50, no. 4, (1997): 719––730.730. JSTOR, JSTOR, www.jstor.org/stable/41789712www.jstor.org/stable/41789712. One can . One can clearly track the similarities between the clearly track the similarities between the content and concerns of Lutz’s book, that was assigned on some of Harvard syllabus, content and concerns of Lutz’s book, that was assigned on some of Harvard syllabus, and Neumark’s and Neumark’s Maliyeye Dair TetkiklerMaliyeye Dair Tetkikler. Both textbooks carry a descriptive and explan-. Both textbooks carry a descriptive and explan-atory characteristic that left little room foatory characteristic that left little room for analysis.r analysis.

314 Richard ARichard A.. Musgrave. “Public Finance Now and ThenMusgrave. “Public Finance Now and Then,,” ” FinanzArchiv/ Public Finance FinanzArchiv/ Public Finance Analysis Analysis Bd. 41, H.1 (Bd. 41, H.1 (19831983): ): 99.. www.jstor.org/stable/40911830www.jstor.org/stable/40911830

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this chapter on public finance will be Fritz Neumark, an influential re

this chapter on public finance will be Fritz Neumark, an influential refu-fu-gee professor who stayed in Turkey for a long period of time compared gee professor who stayed in Turkey for a long period of time compared to other émigré economists. to other émigré economists.

What Neumark frequently emphasizes through his writings is the

What Neumark frequently emphasizes through his writings is the critical importance of national idiosyncrasies. The interrogations on critical importance of national idiosyncrasies. The interrogations on under under whichwhich influenceinfluencess of local peculiarities the financial tradition was of local peculiarities the financial tradition was shaped or to what degree the local financial traditions converged to the shaped or to what degree the local financial traditions converged to the current dominant theories are important aspects to be current dominant theories are important aspects to be urgeurged upon. In d upon. In his opinion, the fiscal policies implemented in different counhis opinion, the fiscal policies implemented in different countries reflect tries reflect international common qualifications and resemble each other only in international common qualifications and resemble each other only in specific periods, especially during the warfare. Yet, at all other times, the specific periods, especially during the warfare. Yet, at all other times, the differences become apparent.differences become apparent.315 Furthermore, due to the disparities Furthermore, due to the disparities between the psychological and between the psychological and political conditions, the fiscal policies political conditions, the fiscal policies applied in one country, can’t be totally translated to another country in applied in one country, can’t be totally translated to another country in any case for him.any case for him.316 This is evident when we think of the situation in This is evident when we think of the situation in Turkey. Both in the textbook and Turkey. Both in the textbook and through various through various articles, the authors articles, the authors urge upon the established public finance traditions among urge upon the established public finance traditions among the the West Eu-West Eu-ropean countries, most probably with the intent of drawing compari-ropean countries, most probably with the intent of drawing compari-sons to figure out the most suitable framework and speculate for an sons to figure out the most suitable framework and speculate for an ideal mix for Turkey. It is important to mention thatideal mix for Turkey. It is important to mention that none of those pub-none of those pub-lic finance theories were absolutely embarked upon, although lic finance theories were absolutely embarked upon, although onone can e can

315 Fritz Fritz Neumark. “Maliye Siyasetinin MilliNeumark. “Maliye Siyasetinin Milli HususiyetleriHususiyetleri,,” ” translated by Sabri Ülgener, translated by Sabri Ülgener, İÜHFM İÜHFM 4, no. 14 (4, no. 14 (19381938): ): 363363. New taxes, state control and ownership become general . New taxes, state control and ownership become general practice in war economices. For a detailed panorama of the economic policies during practice in war economices. For a detailed panorama of the economic policies during warfare see Ivan Berend, warfare see Ivan Berend, 20. Yüzyıl Avrupa İktisat Tarihi20. Yüzyıl Avrupa İktisat Tarihi, 2011., 2011.

316 NeumarkNeumark,, “Maliye Siya“Maliye Siyasetininsetinin,,” 374. ” 374. FFor instance, Neumark claimed that the fiscal or instance, Neumark claimed that the fiscal policies applied in the US and Germany in the 15 years meantime, can’t be implement-policies applied in the US and Germany in the 15 years meantime, can’t be implement-ed in countries like Turkey, France or Switzerland, mainly becauseed in countries like Turkey, France or Switzerland, mainly because ofof the differences the differences on psychological and politon psychological and political conditions. We can see the traces of such approach ical conditions. We can see the traces of such approach through the writings of Sabri Ülgener. Ülgener also believes that the psychological and through the writings of Sabri Ülgener. Ülgener also believes that the psychological and traditional factors besides the concrete conditions are significant determinants and traditional factors besides the concrete conditions are significant determinants and they all slowed down the althey all slowed down the alteration process. After all, Ülgener acted asteration process. After all, Ülgener acted as anan interpreter interpreter in Neumark’s lein Neumark’s lectures. Ictures. In addition to the influence of Neumark on Ülgener; Ülgener’s n addition to the influence of Neumark on Ülgener; Ülgener’s views on evolution of economic mindset views on evolution of economic mindset seems to be influential onseems to be influential on Neumark.Neumark.

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pursue the traces of various affinities for some of them. Neumark insist-

pursue the traces of various affinities for some of them. Neumark insist-ently stresses upon this point by saying that:ently stresses upon this point by saying that:

One should not forget that due to the real differene should not forget that due to the real differences in econom-nces in econom-ic and political organizations based on national peculiarities, ic and political organizations based on national peculiarities, there exists a distancthere exists a distancee from the “ideal type” systems. We should from the “ideal type” systems. We should for instance, consider the disparities between the freedom ideal for instance, consider the disparities between the freedom ideal in different countries, the differences in qualiin different countries, the differences in qualifications between a fications between a German “villager” and an American “farmer”, the discrepancies German “villager” and an American “farmer”, the discrepancies between democracy apprehensions in England, France or Swe-between democracy apprehensions in England, France or Swe-den. They should all be considered. Each country borrows the den. They should all be considered. Each country borrows the fundamental ideas of a certain system but adopts them tofundamental ideas of a certain system but adopts them to its own its own national needs and character. Although a nation’s economic men-national needs and character. Although a nation’s economic men-tality or national character is not always fixed, the changing pro-tality or national character is not always fixed, the changing pro-cess eventuates in a very slow mannercess eventuates in a very slow manner for most of the timefor most of the time. Even . Even at times at times whenwhen economic and political situations have ueconomic and political situations have undergone ndergone changes via great revolutions, the longchanges via great revolutions, the long--standing national traits standing national traits reemergereemerge iin the social institutions and administrationn the social institutions and administration of these of these institutions institutions after a whileafter a while..317

Then, public finance theories in a

Then, public finance theories in a particularparticular countrycountry –– apart from the apart from the originalities of originalities of the the scientists and scientists and the the historical evolution of sciencehistorical evolution of science ––carry out a peculiar national character. This being the case, Neumark carry out a peculiar national character. This being the case, Neumark claims that one can even doubt himclaims that one can even doubt him/her/herself when speaking of a “sci-self when speaking of a “sci-ence” of economics or public finance.ence” of economics or public finance.318

317 Neumark, Neumark, Maliyeye Dair TetkiklerMaliyeye Dair Tetkikler, 318, 318..

318 Neumark, “Maliye SiyasetininNeumark, “Maliye Siyasetinin,,”” 361361--362362.. Pelin Pelin also also mentions the ongoing transfor-mentions the ongoing transfor-mations in functioning of tax through ages, shaped by the differing needs of the coun-mations in functioning of tax through ages, shaped by the differing needs of the coun-tries. As fortries. As for tthe historical evolution of tax, he draws he historical evolution of tax, he draws a a comparison between the comparison between the West West and the East, and locates the implementations like and the East, and locates the implementations like Tithe (Tithe (AşarAşar)) and and Cattle Tax Cattle Tax ((AğnamAğnam)) in the Ottoman Empire close to the Arabic civilization, considering in the Ottoman Empire close to the Arabic civilization, considering Tithe Tithe as a as a rent on land and rent on land and Cattle TaxCattle Tax as a fiscal worship. Then due to the increasing needs, thas a fiscal worship. Then due to the increasing needs, the e taxes increased and the term “vergi” began to be used by the public. Pelintaxes increased and the term “vergi” began to be used by the public. Pelin, , “Verginin “Verginin TarihselTarihsel,“ ,“ 405405--406406..

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4.3.1 The Relation between “The Relation between “Economics” and “Public Finance”Economics” and “Public Finance”

The harmony/division between

The harmony/division between public finance and economicspublic finance and economics can be can be recognized as a theoretical starting point for further elaborations on the recognized as a theoretical starting point for further elaborations on the boundaries of state or the theoretical preferences in constructing a gen-boundaries of state or the theoretical preferences in constructing a gen-uine perspeuine perspective. The quest for whether public finance is regarded as a ctive. The quest for whether public finance is regarded as a field of economic science or law, or considered as an independent field of economic science or law, or considered as an independent branch of science/discipline would bring about better perspective for branch of science/discipline would bring about better perspective for the scheme of things covered in this chapter. If it is assuthe scheme of things covered in this chapter. If it is assumed to be inde-med to be inde-pendent from economic science, then another question pendent from economic science, then another question would would occur: occur: WWhat should be the role of public finance; should it serve for economics hat should be the role of public finance; should it serve for economics or should it carry out different concerns from economics, in a context of or should it carry out different concerns from economics, in a context of “state science” with“state science” withinin a dista distinct methodological agenda? Which one inct methodological agenda? Which one would play the leading role in designating the state action and regulat-would play the leading role in designating the state action and regulat-ing the socioing the socio--economic lifeeconomic life,, and which one’s hegemony over the other is and which one’s hegemony over the other is more tangible in practice? All these might be set forth as principal ques-more tangible in practice? All these might be set forth as principal ques-titions in analyzing the nature and the boundaries of both. ons in analyzing the nature and the boundaries of both.

Jean Marchal, in making sense of the distinction between economics

Jean Marchal, in making sense of the distinction between economics and public finance, refers to the famous French economist Gaetan Pirou and public finance, refers to the famous French economist Gaetan Pirou who claimed “fiscal phenomenon is corrective, collective and who claimed “fiscal phenomenon is corrective, collective and public; public; while economic phenomenon is virtually individual and private. The while economic phenomenon is virtually individual and private. The laws each is contingent upon are naturally different.”laws each is contingent upon are naturally different.”319 This is an asser-This is an asser-tion to be tested for justification via contemplating on various perspec-tion to be tested for justification via contemplating on various perspec-tives resultant of specific socioecontives resultant of specific socioeconomic traditions in some developed omic traditions in some developed

319 Marchal, Marchal, “Mali İktisadın,” “Mali İktisadın,” 130130.. Here we see that Pirou, who is among the most referred Here we see that Pirou, who is among the most referred French authors by Turkish academicsFrench authors by Turkish academics,, considers public finaconsiders public finance outside the logic of nce outside the logic of economics. It is also known that the book of Pirou, namely economics. It is also known that the book of Pirou, namely La Crise du Capitalisme La Crise du Capitalisme Capitalisme et Economie DirigCapitalisme et Economie Dirigéée, Neoe, Neo--socialisme et Capitalisme, Capitalisme et National-socialisme et Capitalisme, Capitalisme et National-isme, L’avenir du Capitalismeisme, L’avenir du Capitalisme is among the special books ofis among the special books of Atatürk. KağanAtatürk. Kağan ÖğütÖğüt and and Cenk YaltırakCenk Yaltırak,, “Kemalizmin Ekonomi Politiğinde Unutulmuş Bir Sayfa: “Güdümlü “Kemalizmin Ekonomi Politiğinde Unutulmuş Bir Sayfa: “Güdümlü EkonomiEkonomi,,” in ” in TTüürkiye’de İktisadi Düşüncerkiye’de İktisadi Düşünce, 170., 170.

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countries. To find out some answers for the previously asked questions,

countries. To find out some answers for the previously asked questions, it would be useful to present sit would be useful to present severaleveral examples from the English, French, examples from the English, French, German and American way of understanding public finance, particularly German and American way of understanding public finance, particularly to see to see their impacts on the perspectives of the academics here. their impacts on the perspectives of the academics here.

The English type of public finance is portrayed to be strongly at-

The English type of public finance is portrayed to be strongly at-tached to general economic theory. The subject matter is mostly about tached to general economic theory. The subject matter is mostly about the problems of economics like social redistribution of the taxthe problems of economics like social redistribution of the tax burden burden and its implications on national economy. Neumark asserts that the ties and its implications on national economy. Neumark asserts that the ties with economic theory was protected, there was a strong and useful co-with economic theory was protected, there was a strong and useful co-operation between theorists and practitioners there.operation between theorists and practitioners there.320 The assessment The assessment of fiscal issues within the framework oof fiscal issues within the framework of economic science f economic science isis reflected reflected among the writings of both Smith and Ricardo to Edgeworth, Pigou, among the writings of both Smith and Ricardo to Edgeworth, Pigou, Marshall, Keynes, Dalton and Hicks.Marshall, Keynes, Dalton and Hicks.321 He even suggests that it is possi-He even suggests that it is possi-ble to follow ble to follow a connection line a connection line between Ricardo’s between Ricardo’s PrinciplesPrinciples and Dalton’s and Dalton’s Public FinancePublic Finance..322

As for the policy part, the fiscal policies in Britain were identified as

As for the policy part, the fiscal policies in Britain were identified as orthodox due to the social conservatism of the country. The peculiar orthodox due to the social conservatism of the country. The peculiar features of fiscal policies in Britain are identified by Neumark as fol-features of fiscal policies in Britain are identified by Neumark as fol-lows: lows: FFirst, the balanced budget princiirst, the balanced budget principle was regarded as a priority ple was regarded as a priority even during economic and fiscal depression and second, the necessary even during economic and fiscal depression and second, the necessary precautions were rapidly and meticulously taken. As for taxation, in-precautions were rapidly and meticulously taken. As for taxation, in-come tax came to forefront as a central element of the tax system. Neu-come tax came to forefront as a central element of the tax system. Neu-

320 Neumark, Neumark, Maliyeye DairMaliyeye Dair, 304. , 304. Musgrave argues that pMusgrave argues that public financeublic finance is regarded as a is regarded as a part of general econompart of general economics and expected to develop in tandem with it. The entrance of ics and expected to develop in tandem with it. The entrance of government as a corrective mechanism is just needed in case of market failures. The government as a corrective mechanism is just needed in case of market failures. The society is seen within an individualistic perspective that is dominated by market prin-society is seen within an individualistic perspective that is dominated by market prin-ciple. Richard A Musgraciple. Richard A Musgrave, “Public Finance and Finanzwissenschaft Traditions Com-ve, “Public Finance and Finanzwissenschaft Traditions Com-paredpared,,”” FinanzArchiv / Public Finance AnalysisFinanzArchiv / Public Finance Analysis, vol. 53, no. 2 , vol. 53, no. 2 ((19961996): ): 185185.. JSTOR, JSTOR, www.jstor.org/stable/40912726.www.jstor.org/stable/40912726.

321 Neumark, Neumark, Maliyeye DairMaliyeye Dair, 304. Yet, Selahatt, 304. Yet, Selahattin Tuncer in the article “İktisadi Kalkınma ve in Tuncer in the article “İktisadi Kalkınma ve Masraf PolitikasıMasraf Politikası,,”” Maliye Araştırmaları Merkezi Konferansları, Maliye Araştırmaları Merkezi Konferansları, no. 3 (1957): 2no. 3 (1957): 2 claims claims that the economic impacts of the public expenditures were diligently analyzed by that the economic impacts of the public expenditures were diligently analyzed by Pigou, Dalton, Hicks, Peacock, Lerner andPigou, Dalton, Hicks, Peacock, Lerner and Hansen, abandoning the classical analysis. Hansen, abandoning the classical analysis.

322 Neumark, Neumark, ““Maliye SiyasetininMaliye Siyasetinin,”,” 362362..

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mark claims that t

mark claims that the Finance Minister in Britain, regardless of his politi-he Finance Minister in Britain, regardless of his politi-cal preference, utilizes the income tax as an influential instrument in cal preference, utilizes the income tax as an influential instrument in obtaining budget balance. A similar tradition makes itself apparent for obtaining budget balance. A similar tradition makes itself apparent for the issues regarding public debt. As for the public credthe issues regarding public debt. As for the public credit, it is claimed it, it is claimed that the excellent situation was achieved by the influence of the psycho-that the excellent situation was achieved by the influence of the psycho-logical factors in this country.logical factors in this country.323

One would be familiar with the French way of public finance as its

One would be familiar with the French way of public finance as its influence was palpable in Turkey, especially before the universitinfluence was palpable in Turkey, especially before the university re-y re-form. French public finance mentality had more solid linkages with law form. French public finance mentality had more solid linkages with law and the economic parts of fiscal phenomenon and the economic parts of fiscal phenomenon were were less considered.less considered.324 By completely negating he economic aspects of the financial institutions By completely negating he economic aspects of the financial institutions and concepts, the French financiers, who and concepts, the French financiers, who were also public lawyers, kind were also public lawyers, kind of married the public finance of married the public finance withwith law.law.325 Yet, Neumark makes mention Yet, Neumark makes mention of Jean Marchal and Henry Laufenburger as the authors that aim to fill of Jean Marchal and Henry Laufenburger as the authors that aim to fill this deficiency of economic aspects.this deficiency of economic aspects.326 It is because Laufenburger, with-It is because Laufenburger, with-out considering out considering public finance as a branch of economics, emphasized public finance as a branch of economics, emphasized the provisional affinities between the two and regarded each other as the provisional affinities between the two and regarded each other as complementary at some points. What is remarkable here is that, complementary at some points. What is remarkable here is that, Marchal and LaufenburgerMarchal and Laufenburger327 were the academic figures, whose articles were the academic figures, whose articles werwere translated and published in the journals of the faculty. In a sense, it e translated and published in the journals of the faculty. In a sense, it

323 Neumark, Neumark, Maliyeye DairMaliyeye Dair, , 368368--369369..

324 Ibid., 304.Ibid., 304. Nevertheless, Nevertheless, Neumark regards LeroyNeumark regards Leroy-- Beaulieu and Say as exceptional. Beaulieu and Say as exceptional.

325 Aykut Aykut HerekmanHerekman, “Henry Laufenburger,” , “Henry Laufenburger,” Anadolu ÜAnadolu Üniversitesi İktisadi ve İdari Bilimler niversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, Fakültesi Dergisi, 2, no. 2 (1966): 57, cited in2, no. 2 (1966): 57, cited in PelinPelin,, Finans Finans İİlmi ve lmi ve FFinansal inansal KKanunlaranunlar İİstanbulstanbul,, ((19621962: : 2727).). Here we must dwell upon the French mentality a little more, as it Here we must dwell upon the French mentality a little more, as it leaves a noticeable impression on economleaves a noticeable impression on economics curricula before the arrival of German ics curricula before the arrival of German émigré economists. Aykut Herekman in his article he wrote after the passing of Lau-émigré economists. Aykut Herekman in his article he wrote after the passing of Lau-fenburger, criticizes the current admiration for the Anglosaxon type while the French fenburger, criticizes the current admiration for the Anglosaxon type while the French type is regarded as inadequate. He asserts thtype is regarded as inadequate. He asserts that the public finance education in Turkey at the public finance education in Turkey reflected French public finance education by saying that a public finance textbook reflected French public finance education by saying that a public finance textbook without Gaston Jeze, is unimaginable.without Gaston Jeze, is unimaginable.

326 Neumark, Neumark, Maliyeye Dair, Maliyeye Dair, 305.305.

327 Laufenburger, who gave lectures at Istanbul University Laufenburger, who gave lectures at Istanbul University for for threethree years, is also years, is also recognized as the name who builrecognized as the name who builtt public finance onpublic finance on aa solid basis in France. Herekman, solid basis in France. Herekman, “Henry Laufenburger“Henry Laufenburger,,”” 5757..

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can be said that the

can be said that the locallocal university journals have moved away from the university journals have moved away from the customary French tradition, by embracing the ones that aimed to nour-customary French tradition, by embracing the ones that aimed to nour-ish public finance with economic issues. Sish public finance with economic issues. Such a tendency can be consid-uch a tendency can be consid-ered as an extension of the process beginning from the emancipation of ered as an extension of the process beginning from the emancipation of economics from law by the foundation of the faculty. Now that the dis-economics from law by the foundation of the faculty. Now that the dis-cussions on public financecussions on public finance,, which indeed represent how the state is which indeed represent how the state is conceptualized, was conceptualized, was moving away from the methodological framework moving away from the methodological framework of law. of law. TThis situation also signifies the prospective increase in the his situation also signifies the prospective increase in the weight of economic roles provided by the instruments of public finance weight of economic roles provided by the instruments of public finance and an effort to utilize the potential benefits that might be acquireand an effort to utilize the potential benefits that might be acquired by d by the fiscal policies in the economic improvement of the country.the fiscal policies in the economic improvement of the country.

In line with the mentioned deficiencies of French fiscal theory, the

In line with the mentioned deficiencies of French fiscal theory, the fiscal practicesfiscal practices in Francein France hadhad alsoalso their share of Neumark’s criticisms. their share of Neumark’s criticisms. The French fiscal policies were identified asThe French fiscal policies were identified as narrownarrow--minded and weak, minded and weak, like like the opposite of the English type. For Neumark, these policies were the opposite of the English type. For Neumark, these policies were hesitantly and incompletely implemented, budget deficits and debt bur-hesitantly and incompletely implemented, budget deficits and debt bur-den were relatively high with respect to other countries. Due to its polit-den were relatively high with respect to other countries. Due to its polit-ical weakness, sical weakness, state in France was not capable of taking advantage of tate in France was not capable of taking advantage of the existing potential of capital wealth.the existing potential of capital wealth.328 Such harsh criticismsSuch harsh criticisms raised raised by Neumarkby Neumark might have contributed to the breaking away from might have contributed to the breaking away from the the French influence in French influence in academia.academia.

The socio

The socio--political viewpoint emergepolitical viewpoint emerged within the German style pub-d within the German style pub-lic finance. The best example for lic finance. The best example for that can be seen in the naming of the that can be seen in the naming of the public finance treatises that are called “staatswirstschaftslehre”public finance treatises that are called “staatswirstschaftslehre” ((devlet devlet ekonomisi ilmiekonomisi ilmi))..329 TThis is considered as a proof of the fact that Germa-his is considered as a proof of the fact that Germa-ny was theny was the principal country in which the science of public finance sub-principal country in which the science of public finance sub-stantially evolved together with the economic science.stantially evolved together with the economic science.330 At this point, At this point, the vitality of the traditional relations between mercantilism and cam-the vitality of the traditional relations between mercantilism and cam-eralism is influential. The main subject of public fineralism is influential. The main subject of public finance was considered ance was considered

328 Neumark, “Maliye SiyasetiNeumark, “Maliye Siyasetinin,” nin,” 369369--370370..

329 Neumark, Neumark, Maliyeye Dair, Maliyeye Dair, 305.305.

330 EteEte,, “Finans İlmine“Finans İlmine,,”” 173173. Ete claims . Ete claims that what finance that what finance iis most concerned with is the s most concerned with is the national economics sciencenational economics science. Ete,. Ete, 169.169.

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as state and state was conceived to be responsible for the development

as state and state was conceived to be responsible for the development of the country which was in need of an adequate revenue.of the country which was in need of an adequate revenue.331 Neumark Neumark attracts the attention towards the distinction between the English and attracts the attention towards the distinction between the English and German style public finance German style public finance by accentuating the German tendency for by accentuating the German tendency for systematization of the phenomena.systematization of the phenomena.332 German style was even more ap-German style was even more ap-preciated by Leipzig educated Professor of Economics Muhlis Ete. Ete’s preciated by Leipzig educated Professor of Economics Muhlis Ete. Ete’s appreciation might be related with his educational background shaped appreciation might be related with his educational background shaped under the Geunder the German influence. In explicating the development of public rman influence. In explicating the development of public finance in Germany, he mentions that social policy principles played finance in Germany, he mentions that social policy principles played important roles in taxation since the half of the 19important roles in taxation since the half of the 19thth century by the century by the emergence of working class, bringing about increasemergence of working class, bringing about increases ines in statstate expendi-e expendi-tures and loans. These facts had acceleratory effecttures and loans. These facts had acceleratory effectss on the publications on the publications on science of public finance which was mostly developed in Germany by on science of public finance which was mostly developed in Germany by Rau, Roscher and Wagner.Rau, Roscher and Wagner.333 Criticizing the fact that the fiscal themes Criticizing the fact that the fiscal themes are squeezed into economics booksare squeezed into economics books in other countries, in other countries, EteEte remunerates remunerates German Adolf Wagner’sGerman Adolf Wagner’s334 book, which examines financial issues within book, which examines financial issues within

331 A. Zühtü Işıl, “Mali Politika İmkanlarının Gerçekleşebilme HudutlarıA. Zühtü Işıl, “Mali Politika İmkanlarının Gerçekleşebilme Hudutları,,”” İÜMAMK,İÜMAMK, no. 6no. 6 ((19601960):): 8484--8585. . During mercantilism era 1550During mercantilism era 1550--1776, the fiscal aspects of the view-1776, the fiscal aspects of the view-popoints concerning enrichment of national economy can be considered under the defi-ints concerning enrichment of national economy can be considered under the defi-nition of fiscal policy. nition of fiscal policy. Işıl, 84.Işıl, 84.

332 Neumark, Neumark, Maliyeye Dair, Maliyeye Dair, 306.306. Ete, “FinansEte, “Finans İlmineİlmine,,”” 174.174. Another difference can be Another difference can be found in Musgrave’s article. He asserts that finanzwissenfound in Musgrave’s article. He asserts that finanzwissenschaft not only comprises the schaft not only comprises the individual but also communal spheres. Unlike the English school, here, it is developed individual but also communal spheres. Unlike the English school, here, it is developed as a discipline of its own that has linkages with history and political science, not just a as a discipline of its own that has linkages with history and political science, not just a parcel of general economics. For Musgrave, thisparcel of general economics. For Musgrave, this made the product “weaker in econom-made the product “weaker in econom-ics but also richer in scope”. Musgrave, Richard A. “Public Finance and Finanzwissen-ics but also richer in scope”. Musgrave, Richard A. “Public Finance and Finanzwissen-schaft Traditions Comparedschaft Traditions Compared,,”” FinanzArchiv / Public Finance AnalysisFinanzArchiv / Public Finance Analysis, vol. 53, no. 2, , vol. 53, no. 2, 1996, 1996, 185185.. JSTOR, www.jstor.org/stable/40912726.JSTOR, www.jstor.org/stable/40912726.

333 Ete, “Finans İlmineEte, “Finans İlmine,,”” 175175..

334 Wagner, takes Smith’s principle on equitable tax one step further by featuring Wagner, takes Smith’s principle on equitable tax one step further by featuring principle of social justice in taxation. İzzettin Önder, “Maliye Öğretisinde Hangi Yönt-principle of social justice in taxation. İzzettin Önder, “Maliye Öğretisinde Hangi Yönt-emem!,!,” ” Maliye Araştırma Merkezi KonferanslarıMaliye Araştırma Merkezi Konferansları 3939,, ((20012001):): 6.6.

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their social aspects, as the greatest work of the last century

their social aspects, as the greatest work of the last century on public on public financefinance..335

By saying that the fiscal policies in Germany cannot be defined with-

By saying that the fiscal policies in Germany cannot be defined with-in a uniform type, Neumark discriminates between Prussian and Reich in a uniform type, Neumark discriminates between Prussian and Reich fiscal policies. While the Prussian fiscal policies were characterized as fiscal policies. While the Prussian fiscal policies were characterized as prudent with a perfect management device in budget balance, Reich prudent with a perfect management device in budget balance, Reich policies have never represented an established fpolicies have never represented an established fiscal regime by reiterat-iscal regime by reiterat-ed fiscal reforms for him. For the current period, Neumark mentions ed fiscal reforms for him. For the current period, Neumark mentions that a more courageous fiscal policy based on the conjuncture policies that a more courageous fiscal policy based on the conjuncture policies and national defense was being implemented. The interesting point in and national defense was being implemented. The interesting point in these policies is that, these policies is that, they were not arranged at the theoretical ground, they were not arranged at the theoretical ground, but tried to be legitimated by the science/theory afterwards.but tried to be legitimated by the science/theory afterwards.336

Until here, we have seen that the economistic view dominates the

Until here, we have seen that the economistic view dominates the English way, legal parts were weighted in English way, legal parts were weighted in the the French and social aspects French and social aspects were iwere in the foreground in the German tradition. As for the American n the foreground in the German tradition. As for the American public finance, it was specified to pay less attention to the legal and so-public finance, it was specified to pay less attention to the legal and so-ciological aspects of the issue. The gravity center of public finance thereciological aspects of the issue. The gravity center of public finance there,, is stated to be comprised of the monographiis stated to be comprised of the monographies through which one can es through which one can see the names of Seligman, Jensen and Schultze; the fiscal institutions see the names of Seligman, Jensen and Schultze; the fiscal institutions and ideas of European countries were not taken into consideration. The and ideas of European countries were not taken into consideration. The etudes that reunite empirical statistical work with the economistic etudes that reunite empirical statistical work with the economistic method like English method like English style were published and the ones of Alvin Hansen style were published and the ones of Alvin Hansen being in the first place, original and revolutionary doctrines inspired by being in the first place, original and revolutionary doctrines inspired by Keynesian theory were set forth.Keynesian theory were set forth.337

335 Ete, “Finans İlmineEte, “Finans İlmine,,” 175” 175.. Ete refers to Mill, Culloch and Say’s works. Musgrave also Ete refers to Mill, Culloch and Say’s works. Musgrave also agrees on that, by saying thatagrees on that, by saying that thethe tax base analysis in English school of public finance tax base analysis in English school of public finance can be inserted into the categories of economics while concepts pursued by thecan be inserted into the categories of economics while concepts pursued by the Ger-Ger-man tradition Finanzwissenschaft are much peculiar to its own necessities. Although man tradition Finanzwissenschaft are much peculiar to its own necessities. Although the presentation of communal concerns in Wagner’s book is clearly seen, it is claimed the presentation of communal concerns in Wagner’s book is clearly seen, it is claimed to be elusive by Musgrave, who compared the traditions of Public Finance and Fi-to be elusive by Musgrave, who compared the traditions of Public Finance and Fi-nannanzwissenschaft. Musgrave, Richard A. “Public Finance and Finanzwissenschaftzwissenschaft. Musgrave, Richard A. “Public Finance and Finanzwissenschaft,” ,” 145145––193.193.

336 Neumark, “Maliye SiyasetiNeumark, “Maliye Siyaseti,,”” 370370--371371..

337 Neumark, Neumark, Maliyeye DairMaliyeye Dair, 308, 308..

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Speaking of the fiscal policies in America, Neumark first mentions

Speaking of the fiscal policies in America, Neumark first mentions the absence of a federal budgethe absence of a federal budget before the end of the Wt before the end of the World orld WWar ar I as I as there was no need for such a rationally managed budget policy that time there was no need for such a rationally managed budget policy that time due to the lack of expenses with respect to the income. However, war due to the lack of expenses with respect to the income. However, war altered the affairs and after the Great Depression, federal fiscal policy altered the affairs and after the Great Depression, federal fiscal policy bebegan to be considered as an instrument of an expansive conjuncture gan to be considered as an instrument of an expansive conjuncture policy. Although being impressed by the economic and fiscal theories, policy. Although being impressed by the economic and fiscal theories, the classical/orthodox principles were not that influential in compari-the classical/orthodox principles were not that influential in compari-son with the conjuncture policies which were featuson with the conjuncture policies which were featured red by Neumark by Neumark as as rapidly implemented, encouraging and dynamic.rapidly implemented, encouraging and dynamic.338

Based on the evaluations on the public finance traditions of various

Based on the evaluations on the public finance traditions of various nations, nations, there occurs there occurs anan impression that English way impression that English way iis primarily ap-s primarily ap-preciated by Neumark for its success in practical termpreciated by Neumark for its success in practical terms despite the s despite the methodological steadiness, French way representsmethodological steadiness, French way represents for thefor the nostalgic nostalgic analogies to be disengaged, German way is characterized as the most analogies to be disengaged, German way is characterized as the most systematic one and the American way systematic one and the American way iis regarded as courageous, maybe s regarded as courageous, maybe with the intent of with the intent of foreseeing the possforeseeing the possible prospective similarities in pol-ible prospective similarities in pol-icy making between the US and Turkey in the near future. Nevertheless, icy making between the US and Turkey in the near future. Nevertheless, it is not an easy job to give complete answers for the questions we asked it is not an easy job to give complete answers for the questions we asked in the first paragraph of this section just by referring to these brief in-in the first paragraph of this section just by referring to these brief in-ttroductions on the public finance envisagement. Still, they might be roductions on the public finance envisagement. Still, they might be helpful in constructing relations between the preexisting conditions at helpful in constructing relations between the preexisting conditions at some place and prominent theoretical choices there. some place and prominent theoretical choices there.

Although it is hard to make theoretical inferences for Turkey o

Although it is hard to make theoretical inferences for Turkey only by nly by virtue of this data, we might track the reference points and criticisms virtue of this data, we might track the reference points and criticisms oriented to them by associating the authors’ commentaries with current oriented to them by associating the authors’ commentaries with current conjunctural circumstances. Yet, to give more earthly answers for the conjunctural circumstances. Yet, to give more earthly answers for the questions questions thatthat would reveal the evolwould reveal the evolutionary path of the public finance utionary path of the public finance mentality in Turkey, it would be useful to extract some basic elements of mentality in Turkey, it would be useful to extract some basic elements of public finance and work on the related theoretical implications of the public finance and work on the related theoretical implications of the authors. As the three important constituents of public finance can be authors. As the three important constituents of public finance can be

338 Neumark, “Maliye SiyasetiNeumark, “Maliye Siyaseti,,” 371” 371--373373..

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defin

defined as budget, taxation and public spending; a diligent examination ed as budget, taxation and public spending; a diligent examination on the approaches on these themes that appear in the articles would on the approaches on these themes that appear in the articles would hopefully bring about a spontaneous clarification on the nature, scope hopefully bring about a spontaneous clarification on the nature, scope and framework of public finance; together with revand framework of public finance; together with revealing its relation ealing its relation with economic science.with economic science.

From this point of view; the frequent approaches on budgetary is-

From this point of view; the frequent approaches on budgetary is-sues will be examined first to see whether the classical school’s “annual sues will be examined first to see whether the classical school’s “annual balanced budget” theory or the Keynesian “cyclic budget” theory balanced budget” theory or the Keynesian “cyclic budget” theory wawas s much momuch more embarked on. By the way, the role of budget in economy and re embarked on. By the way, the role of budget in economy and the meaning attached to the concept would be clarified. Next, the meaning attached to the concept would be clarified. Next, II will fo-will fo-cus on the significance level of public expenditures in the economy as an cus on the significance level of public expenditures in the economy as an instrument of fiscal policy. Then, instrument of fiscal policy. Then, II will elaborawill elaborate on the considerations te on the considerations related with taxation. Emphasizing the features of the “liberal”, “neutral” related with taxation. Emphasizing the features of the “liberal”, “neutral” and “interventionist” taxation policies, which approach’s assumptions and “interventionist” taxation policies, which approach’s assumptions sounded most realistic for the academics will be presented. sounded most realistic for the academics will be presented. TThe chapterhe chapter will be finalwill be finalizedized with a holistic viewpoint on the desired level of the with a holistic viewpoint on the desired level of the state intervention into the economy for the sake of the most prominent state intervention into the economy for the sake of the most prominent concern of the time: a rapid economic development of the country.concern of the time: a rapid economic development of the country.

4.3.2 The Budgetary IssuesThe Budgetary Issues

According to the classical theory,

According to the classical theory, the only fiscal problem the only fiscal problem wawas considered s considered as the provision of an annually balanced budget.as the provision of an annually balanced budget.339 Since state wSince state waas re-s re-garded as an unskillful entrepreneur and an institution that constrains garded as an unskillful entrepreneur and an institution that constrains the freedom, the scope of state activity was preferably limited and state the freedom, the scope of state activity was preferably limited and state budbudget was expected to be as small as possible.get was expected to be as small as possible.340 The The fiscalfiscal function of function of the budget was taken seriously and that function was supposed to signi-the budget was taken seriously and that function was supposed to signi-

339 AhmetAhmet Kılıçbay, “İktisat İlminin Gelişmesi Karşısında Maliye Politikasının Aldığı Kılıçbay, “İktisat İlminin Gelişmesi Karşısında Maliye Politikasının Aldığı İstikametİstikamet,” ,” İÜMAMKİÜMAMK, , no. 4 (1958): 59no. 4 (1958): 59..

340 Sadun ArenSadun Aren,, “Devlet Borçlarının Sınırları Meselesi“Devlet Borçlarının Sınırları Meselesi,,” ” İÜMAMKİÜMAMK no. 5 (1959): 116no. 5 (1959): 116..

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fy “neutrality” as the classics were unwilling to create any change in the

fy “neutrality” as the classics were unwilling to create any change in the use of economic resources via fiscal policuse of economic resources via fiscal policies.ies.341 Yet, the modern theory, Yet, the modern theory, unlike the classical theory, attributed unlike the classical theory, attributed economic and conjuncturaleconomic and conjunctural func-func-tions to budget that budget turned out to be the most influential eco-tions to budget that budget turned out to be the most influential eco-nomic policy instrument directed towards economic equilibrium.nomic policy instrument directed towards economic equilibrium.342 State was thereby claimState was thereby claimed responsible for creating economic stimulus ed responsible for creating economic stimulus to alleviate the conjunctural fluctuations.to alleviate the conjunctural fluctuations.343 This was a remarkable This was a remarkable change and it was identified by Neumark with the assessment that the change and it was identified by Neumark with the assessment that the theorists engaged into public finance issues are indeed the representa-theorists engaged into public finance issues are indeed the representa-tivetives of the conjuncture, money and credit doctrines. What is worth at-s of the conjuncture, money and credit doctrines. What is worth at-tention here is the fixation that they are not tention here is the fixation that they are not financierfinanciers but s but economistseconomists; ; which indeed means that “the science of public finance” which was pre-which indeed means that “the science of public finance” which was pre-viouslyviously oriented to autonomy or the science of oriented to autonomy or the science of law, is now returning to law, is now returning to its starting point, namely “economics”its starting point, namely “economics”(i(iktisadileştiğine işaretktisadileştiğine işaret)). Hence, . Hence, the positioning of statethe positioning of state visvis--àà--visvis conjunctural fluctuations now hap-conjunctural fluctuations now hap-pened be an pened be an economic economic problem.problem.344 And fiscal policy, in brief, was scruti-And fiscal policy, in brief, was scruti-nized in terms of its repercussions on economic actions, without being nized in terms of its repercussions on economic actions, without being limited with tlimited with the treasury qualifications as it was supposed to be accord-he treasury qualifications as it was supposed to be accord-ing to classical liberal theories.ing to classical liberal theories.345

The need for such a change had become non

The need for such a change had become non--negligibly apparent by negligibly apparent by the Great Depression. The Keynesian cyclic budget theory as a solutionthe Great Depression. The Keynesian cyclic budget theory as a solution,, attracted the attention attracted the attention to the need of initiating economic impulses by to the need of initiating economic impulses by state via fiscal policies during conjunctural fluctuations. The theory rec-state via fiscal policies during conjunctural fluctuations. The theory rec-ommended having budget deficits instead of implementing deflationary ommended having budget deficits instead of implementing deflationary policies during depression times. This was nourished by the assumppolicies during depression times. This was nourished by the assumption tion that the deficit will finance itself.that the deficit will finance itself.346 The starting point of this theory was The starting point of this theory was

341 İsmail Türk, “Türkiye’de Bütçe Reformuna Niçin İhtiyaç Vaİsmail Türk, “Türkiye’de Bütçe Reformuna Niçin İhtiyaç Vardır?rdır? Türkiye’de Bütçe Türkiye’de Bütçe Reformu Nasıl Olmalıdır?,Reformu Nasıl Olmalıdır?,” ” Maliye Enstitüsü Konferansları Maliye Enstitüsü Konferansları no. 5 (1962): 63no. 5 (1962): 63--6464..

342 Türk, “Türkiye’de BütçeTürk, “Türkiye’de Bütçe,”,” 6565..

343 Neumark, “Devri BütçeNeumark, “Devri Bütçe,,”” 2121..

344 Neumark, “Konjonktürel Bir BütçeNeumark, “Konjonktürel Bir Bütçe,” ,” 169169..

345 NeumarkNeumark,, “Devri Bütçe“Devri Bütçe,,” 24” 24..

346 NeumarkNeumark,, “Kon“Konjonktürel Bir Bütçejonktürel Bir Bütçe,,” ” 182.182.

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the belief that any fiscal policy that attempts to comply with conjunc-

the belief that any fiscal policy that attempts to comply with conjunc-tural fluctuations, is condemned to fail. Although it is a more elastic the-tural fluctuations, is condemned to fail. Although it is a more elastic the-ory with respect to classicalory with respect to classical theory, it should also be emphasized that theory, it should also be emphasized that this consideration doesn’t completely renounce the concept of budget this consideration doesn’t completely renounce the concept of budget balance, but it aims to provide that balance for 7balance, but it aims to provide that balance for 7--8 years business cycle 8 years business cycle period.period.347

In between the classical and modern theory, an inclination to

In between the classical and modern theory, an inclination towards wards the modern theory makes itself evident in most of the related articles. the modern theory makes itself evident in most of the related articles. To speculate on the reasons, To speculate on the reasons, it can be said it can be said that the ineffectiveness of the that the ineffectiveness of the policies prioritizing budget balance in overcoming economic problems policies prioritizing budget balance in overcoming economic problems might have directed the academicsmight have directed the academics to think more on the potentials of to think more on the potentials of the modern theory. Moreover, the cherished principle on budget balance the modern theory. Moreover, the cherished principle on budget balance could not reallycould not really havehave been put into practice after 1933been put into practice after 1933348 due to the due to the changing conditions. If it comes to that there’s no escape from having changing conditions. If it comes to that there’s no escape from having deficits, deficits, the academics might have preferred to utilize the deficits as a the academics might have preferred to utilize the deficits as a mean of conjuncture policy on a conscious ground as recommended by mean of conjuncture policy on a conscious ground as recommended by the modern theory. And lastly, the increasing popularity of Keynes the modern theory. And lastly, the increasing popularity of Keynes among the worldamong the world, , especially in the USAespecially in the USA,, might have also comight have also contributed to ntributed to the spread of Keynesian ideas among the local academia.the spread of Keynesian ideas among the local academia.

However, we should also emphasize that this acknowledgement oc-

However, we should also emphasize that this acknowledgement oc-casionally has shown up with a critical manner. For instance, the leading casionally has shown up with a critical manner. For instance, the leading figure Fritz Neumarkfigure Fritz Neumark –– apart from many references tapart from many references to Keynes and o Keynes and Keynesians in his textbook on Keynesians in his textbook on ppublic ublic ffinanceinance –– elaborates specifically on elaborates specifically on

347 NeumarkNeumark, “, “Devri Devri BütçeBütçe,,” 20” 20--21.21.

348 Namık Zeki Aral, “Mali Vaziyet, Nakdi VaziyetNamık Zeki Aral, “Mali Vaziyet, Nakdi Vaziyet,,” 282. Aren mentions that Aral submitted ” 282. Aren mentions that Aral submitted his resignation after his emphasis on this fact which was not welcomed by İnönü. Aren, his resignation after his emphasis on this fact which was not welcomed by İnönü. Aren, Puslu CamınPuslu Camın, 75, 75--7676. Indeed. Indeed there are some arguments presenting there are some arguments presenting aa dissensusdissensus on this on this mattermatter between Atatürk and İnönü. Akalın claims that the reason behind the dismissal between Atatürk and İnönü. Akalın claims that the reason behind the dismissal of İnönü from prime ministry of İnönü from prime ministry wawas s Atatürk’s Atatürk’s disapproval of the “balanced budgetdisapproval of the “balanced budget--hard hard currency” policies in currency” policies in the current conjuncture and the current conjuncture and his his preference of Keynesian func-preference of Keynesian func-tional finance. Yet, Öğüt and Yaltırak claim that such an assertion is interrogable in the tional finance. Yet, Öğüt and Yaltırak claim that such an assertion is interrogable in the sense that it cannot be proved by any discourse of Atatürk. Even so, they emphasize a sense that it cannot be proved by any discourse of Atatürk. Even so, they emphasize a potential dissent bpotential dissent between İnönü and Atatürk about budget balance. Öğüt and Yaltırak, etween İnönü and Atatürk about budget balance. Öğüt and Yaltırak, “Kemalizmin Ekonomi Politiğinde“Kemalizmin Ekonomi Politiğinde,” ,” in in Türkiye’de İktisadi DüşünceTürkiye’de İktisadi Düşünce, 192, 192--193193. .

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the Keynesian approaches related to budget mainly in two of his arti-

the Keynesian approaches related to budget mainly in two of his arti-cles. The first was written in 1939 and the second in 1947. The years cles. The first was written in 1939 and the second in 1947. The years are important to mention to seeare important to mention to see if any change can be traced meanwhile. if any change can be traced meanwhile. In the first article, one can feel his cautious distance from Keynesian In the first article, one can feel his cautious distance from Keynesian cyclic budget policies. Although he remunerates the cyclic budget theo-cyclic budget policies. Although he remunerates the cyclic budget theo-ry by claiming that it is a rational instrument and inherently much more ry by claiming that it is a rational instrument and inherently much more iin accordance with the current conditions compared to the classical n accordance with the current conditions compared to the classical theory, he emphasizes that it is not solely able to solve the economic theory, he emphasizes that it is not solely able to solve the economic problems. For him, this theory is based on unrealistic assumptions problems. For him, this theory is based on unrealistic assumptions which might bring about some difficulties and hazarwhich might bring about some difficulties and hazards in implementa-ds in implementa-tion such as increasing the public debt. In order to be successful in prac-tion such as increasing the public debt. In order to be successful in prac-tice, the prerequisites of the theory should have been better described tice, the prerequisites of the theory should have been better described for him. Moreover, presupposing a congruity between the booms and for him. Moreover, presupposing a congruity between the booms and the busts, or a perfect diagthe busts, or a perfect diagnosis of the conjunctural circumstances nosis of the conjunctural circumstances sounds unrealistic to Neumark.sounds unrealistic to Neumark.349 Hence, he positions himself against Hence, he positions himself against the policies that prescribe an alleviation of the tax burden during the the policies that prescribe an alleviation of the tax burden during the bust with the concern that an equally increased the tax revenue would bust with the concern that an equally increased the tax revenue would not prnot probably be achieved during the boom periods.obably be achieved during the boom periods.350 The concerns of The concerns of Neumark were grounded indeed, especially for a country that felt the Neumark were grounded indeed, especially for a country that felt the deficiency of calculable statistical data and a settled completely rational deficiency of calculable statistical data and a settled completely rational thinking on economy. thinking on economy.

When we examine the article

When we examine the article written in 1947written in 1947351 we can feel a slight we can feel a slight change in change in the the viewpoint of Neumark, even if viewpoint of Neumark, even if thisthis can’t be described as a can’t be described as a

349 Neumark “Devri BütçeNeumark “Devri Bütçe,,” 25” 25--2828. . Neumark refers to the Austrian economic theorist Neumark refers to the Austrian economic theorist Haberler’s words that are “each Haberler’s words that are “each conjuncture is a historical data”,conjuncture is a historical data”, which means that he which means that he is of the opinion of attaching an absolute and universal value to the principles is is of the opinion of attaching an absolute and universal value to the principles is wrong.wrong. A basic observation on the articles ofA basic observation on the articles of Neumark is Neumark is hishis emphasis on the national, emphasis on the national, material, psychological particmaterial, psychological particularities of the individuals in a certain country and the ularities of the individuals in a certain country and the reactions of the locals reactions of the locals visvis--àà--visvis alternatives policiesalternatives policies..

350 Neumark, “Konjonktürel Bir BütçeNeumark, “Konjonktürel Bir Bütçe,,” 187” 187; ; “Devri Bütçe“Devri Bütçe,,” 22” 22..

351 This article was translated by Osman Okyar, a CambridgeThis article was translated by Osman Okyar, a Cambridge--educated economist aeducated economist and a nd a student of Keynes. He was among the pioneer figures that played key roles in recogni-student of Keynes. He was among the pioneer figures that played key roles in recogni-tion of Keynesian Theory in Turkey, whose PhD thesis was on the comparison of tion of Keynesian Theory in Turkey, whose PhD thesis was on the comparison of the the Keynesian theory Keynesian theory with thewith the neoclassical theory. Indeed, we can say that the enthusiasmneoclassical theory. Indeed, we can say that the enthusiasm

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radical shift. Still emphasizing on the difficulties in fulfilling the condi-

radical shift. Still emphasizing on the difficulties in fulfilling the condi-tions for implementation possibilities of the theory, he says that thtions for implementation possibilities of the theory, he says that the e Great Depression was a breaking point and defines Keynesian theory as Great Depression was a breaking point and defines Keynesian theory as a revolution in budget theory by virtue of highlighting the critical im-a revolution in budget theory by virtue of highlighting the critical im-portance portance ofof fiscal policy infiscal policy in conductingconducting economy at some occasions in-economy at some occasions in-stead of stead of adaptingadapting to it. Such to it. Such a a tendency to dtendency to distinguish the theoretical istinguish the theoretical contributions of Keynes can also be seen in many parts of Neumark’s contributions of Keynes can also be seen in many parts of Neumark’s Maliyeye Dair Tetkikler,Maliyeye Dair Tetkikler, published in 1948. In the book, he even men-published in 1948. In the book, he even men-tions that by virtue of Keynes, they have learned the fact that the pro-tions that by virtue of Keynes, they have learned the fact that the pro-pensity to consume is pensity to consume is a necessary condition for investment, instead of a necessary condition for investment, instead of having adverse effects on it.having adverse effects on it.352 It is important to note thatIt is important to note that Neumark Neumark never never tendstends to advocate for an ideology blindly in any of his writings, he to advocate for an ideology blindly in any of his writings, he always aims to reach a compromise both without totally abandoninalways aims to reach a compromise both without totally abandoning his g his scientific viewpoint or losing touch with reality. And the mentioned scientific viewpoint or losing touch with reality. And the mentioned shift in his approach, even though slight, might be related with the wid-shift in his approach, even though slight, might be related with the wid-ening dissemination of Keynesian ideas and the more tangible benefits ening dissemination of Keynesian ideas and the more tangible benefits of them in the new economic order afterof them in the new economic order after the Wthe World orld WWar ar II.II.

It should not be perceived as an incidental change visible in Neu-

It should not be perceived as an incidental change visible in Neu-mark’s views. Elaborating on mark’s views. Elaborating on variousvarious articles after the Warticles after the World orld WWar ar II, II, during when the themes related with “economic development” cduring when the themes related with “economic development” caame to me to forefront much more frequently thanforefront much more frequently than before, it is clearly seen that the before, it is clearly seen that the modern theory was substantially interiorized by mmodern theory was substantially interiorized by most of theost of the academics. academics. The prevalent insights of the current policymakers on budget The prevalent insights of the current policymakers on budget wewere re blamed for prioritizing the “fiscal function” of budget.blamed for prioritizing the “fiscal function” of budget.353 Such appre-Such appre-hensions were hensions were criticized by the argument that a balanced budget is not criticized by the argument that a balanced budget is not a fiscal merit, unless the economy is at equilibrium at the full employ-a fiscal merit, unless the economy is at equilibrium at the full employ-

for Keynes descended from father to son in Okyar’s case. Osman Okyar’s father Ali

for Keynes descended from father to son in Okyar’s case. Osman Okyar’s father Ali Fethi Okyar, a close friend of Mustafa Kemal and the founder of Free Republican PartyFethi Okyar, a close friend of Mustafa Kemal and the founder of Free Republican Party, , was an admirer of Keynes’ analysis who promptly translated Keynes’ was an admirer of Keynes’ analysis who promptly translated Keynes’ The Economic The Economic ConseqConsequences of the Peaceuences of the Peace only only a few years after its publication.a few years after its publication.

352 Neumark. Neumark. Maliyeye Dair,Maliyeye Dair, 186186..

353 Pamuk claimed that the Central Bank might be considered as an institution reluctant Pamuk claimed that the Central Bank might be considered as an institution reluctant to implement to implement thethe Anglosaxon theories as well. Pamuk. (2018) Anglosaxon theories as well. Pamuk. (2018) PPersonal communicersonal communica-a-tiontion..

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ment level. Otherwise, a budget surplus during inflation and a budget

ment level. Otherwise, a budget surplus during inflation and a budget deficit in deflation is offered. Advocating for a balanceddeficit in deflation is offered. Advocating for a balanced budget regard-budget regard-less of economic conjuncture less of economic conjuncture wawas regarded meaningless, from the s regarded meaningless, from the standpoint that puts the “economic” balance in front of the “fiscal” bal-standpoint that puts the “economic” balance in front of the “fiscal” bal-ance.ance.354 And obviouslyAnd obviously,, the economic balance was preferred as the pri-the economic balance was preferred as the pri-mary purpose for the academics, mary purpose for the academics, asas theythey are critical of the experienced are critical of the experienced results of the policies prioritizing the fiscal balance, which wresults of the policies prioritizing the fiscal balance, which wereere already already unaccomplished indeed.unaccomplished indeed.

The cyclic budget was not the only alternative for the annual bal-

The cyclic budget was not the only alternative for the annual bal-anced budget. A related concept of “the functional finance”anced budget. A related concept of “the functional finance”, , first used by first used by LSE educated economist Abba LernerLSE educated economist Abba Lerner,, was also debated among the au-was also debated among the au-thors. This was defined as a philosophy that aims for economic stability thors. This was defined as a philosophy that aims for economic stability and full employment via utilizing the instruments of state income and and full employment via utilizing the instruments of state income and expenditures.expenditures.355 It also suggests It also suggests using taxation as a device in prevention using taxation as a device in prevention of excessive inflationary pressures.of excessive inflationary pressures.356 In brief, for the proponents of In brief, for the proponents of functional finance, the fiscal policy should serve for the development of functional finance, the fiscal policy should serve for the development of the less developed countries,the less developed countries,357 which was indeed compatible with the which was indeed compatible with the conconcerns of thecerns of the locallocal academics at universities. Therebyacademics at universities. Thereby,, this theory had this theory had also repercussions in the articles. For instance, economist and politician also repercussions in the articles. For instance, economist and politician Atilla Karaosmanoğlu directly discusses the concept of functional fi-Atilla Karaosmanoğlu directly discusses the concept of functional fi-nance at length in one of his articles by nance at length in one of his articles by remunerating for its prospects remunerating for its prospects on some fiscal instruments.on some fiscal instruments.358 Yet, he criticizes the theory for being Yet, he criticizes the theory for being such heavily established on state intervention and disregarding the psy-such heavily established on state intervention and disregarding the psy-chological factors.chological factors.359 Sadun Aren in underpinning his emphasis on the Sadun Aren in underpinning his emphasis on the

354 İsmail Türkİsmail Türk,, “Türkiye’de Bütçe Reformu“Türkiye’de Bütçe Reformu,,” 65” 65..

355 Karaosmanoğlu, “Fonksiyonel MaliyeKaraosmanoğlu, “Fonksiyonel Maliye,,” 42” 42..

356 MusgraveMusgrave, , “Public Finance Now and Then“Public Finance Now and Then,,”” 1010..

357 BesimBesim ÜstünelÜstünel,, “Gelir ve Servet Vergilerinin İktisadi Tesirleri“Gelir ve Servet Vergilerinin İktisadi Tesirleri,,” ” İÜMAMK İÜMAMK no.1 (no.1 (19551955): ): 3737..

358 KaraosmanoğluKaraosmanoğlu,, “Fonks“Fonksiyonel Maliyeiyonel Maliye,,”” 4422--4949.. Instead of providing money for the state, Instead of providing money for the state, the purpose of the tax is revealed to be as an instrument that regulates the expendi-the purpose of the tax is revealed to be as an instrument that regulates the expendi-tures of the individual, thus it is expected to be fluctuant. Karaosmanoğlutures of the individual, thus it is expected to be fluctuant. Karaosmanoğlu, 45., 45.

359 IbidIbid., ., 54. Karaosmanoğl54. Karaosmanoğlu also u also mentionsmentions the famous public finance theorist Lutz who the famous public finance theorist Lutz who criticized this approach by claiming that it is not compatible with democracy and it criticized this approach by claiming that it is not compatible with democracy and it

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importance of pub

importance of public debt to cover public expenditure, refers to Lerner lic debt to cover public expenditure, refers to Lerner who claimed that the relative burden of the public debts is counterintui-who claimed that the relative burden of the public debts is counterintui-tively much less than it is assumed.tively much less than it is assumed.360 It was not limited with the im-It was not limited with the im-pacts of Keynes and Lerner indeed; the influence of the Anglopacts of Keynes and Lerner indeed; the influence of the Anglo--Saxon Saxon economists like Pigou, Dalton, Hicks, Lerner and Hansen, who contrib-economists like Pigou, Dalton, Hicks, Lerner and Hansen, who contrib-uted to the literature with a thorough research on the impacts of public uted to the literature with a thorough research on the impacts of public expendituresexpenditures361, can’t be denied when we think of the frequent empha-, can’t be denied when we think of the frequent empha-sis of thesis of the locallocal authors on the major roleauthors on the major role of public expenditures in eco-of public expenditures in eco-nomic development. nomic development.

It is even mentioned that with respect to other precautions of fiscal

It is even mentioned that with respect to other precautions of fiscal policy, the role of public expenditure has more importance in the devel-policy, the role of public expenditure has more importance in the devel-oping countries. Theoretically speaking, the oping countries. Theoretically speaking, the minimum expenditure minimum expenditure theo-theo-ryry of the classical school was considered as far from being a guide for of the classical school was considered as far from being a guide for the current public policies and the the current public policies and the voluntary exchange theoryvoluntary exchange theory’s lack of ’s lack of authenticity was authenticity was highlightehighlightedd, , which was an application of subjective which was an application of subjective value theorem to public economics, blurvalue theorem to public economics, blurring the margin between public ring the margin between public and private economics.and private economics.362 The ultimate purpose was The ultimate purpose was to to achievachieve ae a gen-gen-eral welfare and state was regarded responsible for maximizing the so-eral welfare and state was regarded responsible for maximizing the so-cial advantage, not only for individuals but for the whole society. In-cial advantage, not only for individuals but for the whole society. In-creasing economic “prcreasing economic “productivity” for developmental purposes was oductivity” for developmental purposes was emphasized and the amount of state expendituresemphasized and the amount of state expenditures with respect to the with respect to the national income innational income in increasing productivityincreasing productivity is is expected expected toto be settledbe settled..363

The theories affirming the economic effects of public expenditures

The theories affirming the economic effects of public expenditures have cohave comeme up with two concepts: the multiplier and the acceleration up with two concepts: the multiplier and the acceleration effect. Yet, we should keep in mindeffect. Yet, we should keep in mind thatthat these Keynesian precepts were these Keynesian precepts were mostly oriented to solve the conjunctural problems in the developed mostly oriented to solve the conjunctural problems in the developed

reflects a transition from Anglo

reflects a transition from Anglo--American state to German type stateAmerican state to German type state. . KaraosmanoğluKaraosmanoğlu, , 4848--4949..

360 Sadun Aren, “DeSadun Aren, “Devlet Borçlarıvlet Borçları,,” 118” 118; ; Neumark, Neumark, Maliyeye Dair,Maliyeye Dair, 292292..

361 SelahattinSelahattin Tuncer,Tuncer, “İktisadi Kalkınma ve Masraf Meselesi“İktisadi Kalkınma ve Masraf Meselesi,,”” 22..

362 MemduhMemduh YaşaYaşa,, “Devlet Faaliyetinin ve Amme Masraflarının Optimal Seviyesi“Devlet Faaliyetinin ve Amme Masraflarının Optimal Seviyesi,,” ” İÜMAMK İÜMAMK no. 5 (no. 5 (19591959): ): 2525--2626..

363 Memduh Yaşa, “Vergi Politikası Memduh Yaşa, “Vergi Politikası ve İktisadi Kalkınmave İktisadi Kalkınma,,” ” İÜİFM İÜİFM 16, 116, 1--4, (1954): 57.4, (1954): 57.

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world. As for their applicability in developing countrie

world. As for their applicability in developing countries, it is alleged that s, it is alleged that the multiplier effect is partially influential; yet the acceleration effect the multiplier effect is partially influential; yet the acceleration effect which increases the consumption levels in developing countries which increases the consumption levels in developing countries –– with with the assumption that propensity to consume is high the assumption that propensity to consume is high inin these countriesthese countries –– is more influentiis more influential, as the increased demand promotes systematic in-al, as the increased demand promotes systematic in-vestments, paving the way for further developmental moves.vestments, paving the way for further developmental moves.364 Howev-Howev-er, there are some arguments disconfirming the contribution of an in-er, there are some arguments disconfirming the contribution of an in-creased propensity to consume to economic development, particularly creased propensity to consume to economic development, particularly in a in a country wherecountry whereinin the propensity and the opportunity to save is al-the propensity and the opportunity to save is al-ready very low.ready very low.

4.3.3 TaxationTaxation

When we think o

When we think off taxation, we mostly use the conceptual patterntaxation, we mostly use the conceptual pattern that isthat is the tax burden. However, the tax burden. However, the articles catalysedthe articles catalysed a rethinking on to what a rethinking on to what degree the tax burddegree the tax burden should be defined as a “burdenen should be defined as a “burden”. ”. Such a contem-Such a contem-plation is important as it provesplation is important as it proves for for the existence of the existence of some some psychological psychological clichés clichés inin this matter and the counter arguments this matter and the counter arguments againstagainst this attributed this attributed label signify certain theoretical positionings of the economlabel signify certain theoretical positionings of the economists. It is true ists. It is true that there is a conventional wisdom regarding tax as a subjthat there is a conventional wisdom regarding tax as a subjective bur-ective bur-den since it requires selfden since it requires self--sacrifice; but as İbrahim Fazıl Pelin pointsacrifice; but as İbrahim Fazıl Pelin pointeded out, there is both a burden and a utility part in each tax.out, there is both a burden and a utility part in each tax.365 In Neumark’s In Neumark’s opinion, this issue should be considered on a preferential basis of the opinion, this issue should be considered on a preferential basis of the usage of tax income.usage of tax income.366 DespiDespite the different emphasis, both writers’ te the different emphasis, both writers’ approaches approaches wewere then against the view of the symbolic French classical re then against the view of the symbolic French classical

364 Tuncer, “İktisadi KalkınmaTuncer, “İktisadi Kalkınma,,” 12” 12--1717.. Multiplier effect is also considered as fallacious by Multiplier effect is also considered as fallacious by G. D. N. Worswick as it asserts a stationary relation between total investment and total G. D. N. Worswick as it asserts a stationary relation between total investment and total consumption. consumption. J. N. J. N. WorswWorswick, “İktisadi Planlamaick, “İktisadi Planlama:: Tam İstihdam ve Maliye PolitikasıTam İstihdam ve Maliye Politikası,,” ” translated by Gülten Kazgantranslated by Gülten Kazgan,, İÜİFM İÜİFM 14, no. 114, no. 1--4 (1952): 4 (1952): 46.46.

365 Pelin, Pelin, Finans İlmiFinans İlmi, 148., 148.

366 Neumark, Neumark, Maliyeye Dair,Maliyeye Dair, 250.250.

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school thinker John Baptiste Say, who claimed that the value of the tax

school thinker John Baptiste Say, who claimed that the value of the tax for the taxpayer himself will be disappeared as soon as it is paid and for the taxpayer himself will be disappeared as soon as it is paid and cconsumed by the government, nothing will be back for the society.onsumed by the government, nothing will be back for the society.367 The authors The authors here here argue against this assertion by emphasizing that the argue against this assertion by emphasizing that the tax income would tax income would lay the groundworklay the groundwork for socially valuable public ser-for socially valuable public ser-vices; instead of being mystically disappeared. It ivices; instead of being mystically disappeared. It is also mentioned that s also mentioned that the public economics must envision within a framework of a muchthe public economics must envision within a framework of a much--extended period than the private entrepreneurship can comprehend. extended period than the private entrepreneurship can comprehend. Based on the profundity of the cultural needs, there might also be some Based on the profundity of the cultural needs, there might also be some expenditures oriented for the inexpenditures oriented for the institutions that are not even profita-stitutions that are not even profita-ble,ble,368 as state’s field of activity is not necessarily shaped by economic as state’s field of activity is not necessarily shaped by economic incentives.incentives.369 Neumark claims that an attitude equating or reducing all Neumark claims that an attitude equating or reducing all taxes qua “burden” can’t be complied with the current approaches about taxes qua “burden” can’t be complied with the current approaches about the nathe nature and significance of state.ture and significance of state.370 A heading in a French newspaper A heading in a French newspaper MatinMatin in 1935 was in 1935 was propoundinpropounding that “the first duty of an assembly is to g that “the first duty of an assembly is to provide the countryprovide the country against taxation”. Nagainst taxation”. Neumark on the other hand,eumark on the other hand, after after making mention of this assertion,making mention of this assertion, responded to responded to itit by reversing the by reversing the statement upside downstatement upside down.. He claimsHe claims that, particularly for a young country that, particularly for a young country like Turkey and at least for certain occasions, “the duty is to like Turkey and at least for certain occasions, “the duty is to protect the protect the country with taxationcountry with taxation.”.”371

367 Işıl, “Mali Politika İmkanlarınınIşıl, “Mali Politika İmkanlarının,,” 93” 93, cited in, cited in Say “Tax never serves foSay “Tax never serves for national wealth r national wealth in any respect; contrarily it deprives the each taxpayer producer from a revenue.” Say, in any respect; contrarily it deprives the each taxpayer producer from a revenue.” Say, Traite d’economie politiqueTraite d’economie politique, 447. “, 447. “PPoverty should be eliminated by alleviating tax” Say, overty should be eliminated by alleviating tax” Say, 449. Işıl mentions that this was based on a logic that unless449. Işıl mentions that this was based on a logic that unless the individual gets richer, the individual gets richer, the society would not get richer. Işıl, 95.the society would not get richer. Işıl, 95.

368 Neumark, Neumark, Maliyeye DairMaliyeye Dair, , 253. Laufenburger253. Laufenburger argues that the principle of private argues that the principle of private rentability is increasingly replaced by the concept of public interest by dint of the ex-rentability is increasingly replaced by the concept of public interest by dint of the ex-pansion of pupansion of public servicesblic services. Henry Laufenburger, “İktisadi Tedbirlerin Mali İktisadi . Henry Laufenburger, “İktisadi Tedbirlerin Mali İktisadi Bütçe Üzerindeki AkisleriBütçe Üzerindeki Akisleri,,” ” İÜİFM İÜİFM 10, no. 110, no. 1--4 (1949):77.4 (1949):77.

369 MemduhMemduh Yaşa, “Devlet Faaliyetinin ve Amme Masraflarının Optimal SeviyesiYaşa, “Devlet Faaliyetinin ve Amme Masraflarının Optimal Seviyesi,,” ” İÜMAMK, İÜMAMK, no.5 (no.5 (19591959):): 3131..

370 Neumark, Neumark, Maliyeye DaiMaliyeye Dairr, 257. , 257.

371 Fritz Neumark, “Vergi Yükü ve İktisadi HayatFritz Neumark, “Vergi Yükü ve İktisadi Hayat,,” translated by Sabri Ülgener, ” translated by Sabri Ülgener, İÜHFM İÜHFM 3 3 (1937): 257(1937): 257,, quoted in quoted in MatinMatin, 8.6.1935., 8.6.1935.

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According to the liberals, the only function of taxation should

According to the liberals, the only function of taxation should be the be the fiscal functionfiscal function, , procurement procurement of of revenue for the treasure, the nonrevenue for the treasure, the non--fiscal fiscal impacts were disregarded for a long time. The secondary effects were impacts were disregarded for a long time. The secondary effects were characterized as “mal necessaire” in liberal viewpoint and furthermorecharacterized as “mal necessaire” in liberal viewpoint and furthermore,, regarded regarded as as undesirable for the onundesirable for the ones that upholds the “neutral” taxa-es that upholds the “neutral” taxa-tion.tion.372 In the opinion of the proponents of neutral taxation, taxation In the opinion of the proponents of neutral taxation, taxation should not bring about any change in the relative material circumstanc-should not bring about any change in the relative material circumstanc-es of the taxpayers. In other words, the position of an individual in the es of the taxpayers. In other words, the position of an individual in the income aincome and wealth hierarchy would better not nd wealth hierarchy would better not be be changed after taxa-changed after taxa-tion. Yet, in the fulfillment of the increasing functions of state, the desire tion. Yet, in the fulfillment of the increasing functions of state, the desire for utilization of the nonfor utilization of the non--fiscal effects of taxation has increased and a fiscal effects of taxation has increased and a tendency to conduct these effects lead to a ptendency to conduct these effects lead to a preferment of the interven-referment of the interven-tionist taxation policy.tionist taxation policy.373

Fritz Neumark in his textbook mentions that the exhaustive debates

Fritz Neumark in his textbook mentions that the exhaustive debates in the classical public finance books on whether taxation is good or not, in the classical public finance books on whether taxation is good or not, were described as “childish” by the famous French financier Alliwere described as “childish” by the famous French financier Allix with x with good reason.good reason.374 Professor Orhan Dikmen takes this much further by as-Professor Orhan Dikmen takes this much further by as-serting that the advocacy for liberal taxation is considered as a primor-serting that the advocacy for liberal taxation is considered as a primor-dial mentality or a lack of adequate information in public finance.dial mentality or a lack of adequate information in public finance.375 For For him, such liberal ideas can only attrahim, such liberal ideas can only attract supporters among the authors in ct supporters among the authors in America who have a peace in mind, whereas most of the European au-America who have a peace in mind, whereas most of the European au-thors whirling for various political and social problems, position against thors whirling for various political and social problems, position against the neutral taxation.the neutral taxation.376 The “neutrality” assumption is under attack not The “neutrality” assumption is under attack not only by dionly by dint of such problems, but it is also considered as ant of such problems, but it is also considered as ann utopia for utopia for each tax inevitably brings about a change in the social product distribu-each tax inevitably brings about a change in the social product distribu-tion.tion.377 Neumark, refers to Baudin’s words about neutral money “it is Neumark, refers to Baudin’s words about neutral money “it is

372 Orhan Orhan DikmenDikmen, , “Liberal, Bitaraf, Müdahaleci Vergi Politikaları“Liberal, Bitaraf, Müdahaleci Vergi Politikaları,,”” İÜMAMK, İÜMAMK, no. 1no. 1 ((19551955):): 2525..

373 Ibid., Ibid., 2424..

374 Neumark, Neumark, Maliyeye DairMaliyeye Dair, , 113113..

375 Dikmen,Dikmen, “Liberal, Bitaraf“Liberal, Bitaraf,”,” 2727..

376 IbidIbid..,, 3333--3434..

377 Neumark, Neumark, Maliyeye DairMaliyeye Dair, , 8585..

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impossible to assume as though money does not exist”

impossible to assume as though money does not exist” ((parayı sanki parayı sanki yokmuş gibi telakki etmek imkansızdıryokmuş gibi telakki etmek imkansızdır)) by claiming that this apprehen-by claiming that this apprehen-sion is also valid for neutral taxation.sion is also valid for neutral taxation.378

Through the writings,

Through the writings, it is seen that it is seen that the authors the authors considerconsider the nonthe non--fiscal effects of taxation as meanfiscal effects of taxation as meanss of state in attaining the socof state in attaining the social and ial and economic objectives. Although the very first function of tax is aeconomic objectives. Although the very first function of tax is acknowl-cknowl-edged edged as the fiscal function, the positive impacts of the nonas the fiscal function, the positive impacts of the non--fiscal im-fiscal im-pacts on the economic and social organism of a country are also wel-pacts on the economic and social organism of a country are also wel-comedcomed;; and further to thatand further to that,, they are cothey are considered indispensable for the nsidered indispensable for the national development process.national development process.379 In contrast with Laufenburger’s idea In contrast with Laufenburger’s idea that “political taxation demolishes fiscal taxation as the economic life that “political taxation demolishes fiscal taxation as the economic life wanders from its natural order”wanders from its natural order”380; Neumark, who defined Laufen-; Neumark, who defined Laufen-burger’s insistence on burger’s insistence on fiscal neutrality as a product of an extremely lib-fiscal neutrality as a product of an extremely lib-eral attitude,eral attitude,381 claimclaimss that “the most important baseline of fiscal mani-that “the most important baseline of fiscal mani-festations is the political aspect.”festations is the political aspect.”382

Yet, we should be careful in positioning Neumark’s view into some

Yet, we should be careful in positioning Neumark’s view into some determined categories. Althoughdetermined categories. Although he believes that taxation is an instru-he believes that taxation is an instru-ment of social welfare and economic progress ment of social welfare and economic progress byby amending income dis-amending income dis-tribution,tribution,383 he emphasizes that he emphasizes that thesethese should not be characterized asshould not be characterized as distinguishing fundamental featuredistinguishing fundamental featuress of taxation. For him, acknowledg-of taxation. For him, acknowledg-ing the noning the non--fifiscal impacts and serving these impacts for useful purposesscal impacts and serving these impacts for useful purposes

378 Ibid.,Ibid., 174174..

379 DikmenDikmen, , “Liberal, Bitaraf“Liberal, Bitaraf,” ,” 3333..

380 Ibid., Ibid., 3737.. Laufenburger, argues against Neumark by referring his name, in his Laufenburger, argues against Neumark by referring his name, in his consideration of econoconsideration of economic and social functions of taxation. mic and social functions of taxation. HeHe attracts the attention to attracts the attention to the disappointing results of such political taxationthe disappointing results of such political taxation. Henry . Henry LaufenburgerLaufenburger, , “Verginin “Verginin İİktisadi ve İçtimai Siyasetin Vasıtası Olarak Kullanılmasıktisadi ve İçtimai Siyasetin Vasıtası Olarak Kullanılması,,”” translated by Bedi Necmettin translated by Bedi Necmettin FeyzioğluFeyzioğlu,, AÜHFD AÜHFD 6, no. 1 (1949),6, no. 1 (1949), 225225.. HeHe claims that instead of taxes, loans better claims that instead of taxes, loans better serve for the attainment of the goals of economic development and full employmentserve for the attainment of the goals of economic development and full employment, , Ibid., Ibid., 230230--231. As for alleviating the conjunctural fluctuations, he claims that loans and 231. As for alleviating the conjunctural fluctuations, he claims that loans and public expenditures better perform with respect to the taxation policies in actionpublic expenditures better perform with respect to the taxation policies in action.. Ibid., Ibid., 231231..

381 Neumark, Neumark, Maliyeye DairMaliyeye Dair,, 117171..

382 Neumark, Neumark, Maliyeye DairMaliyeye Dair ,11.,11.

383 DDikmen, “Liberal, Bitarafikmen, “Liberal, Bitaraf,,”” 3636..

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are

are not same as acknowledging the social function as an organic con-not same as acknowledging the social function as an organic con-stituent of taxation.stituent of taxation.384 By saying this, he argues against the wellBy saying this, he argues against the well--known known German economist AdolGerman economist Adolphph Wagner, who Wagner, who portrayeportrayed the social pd the social purpose urpose aas s the prior goal of taxation. The cautious attitude of Neumark the prior goal of taxation. The cautious attitude of Neumark visvis--àà--visvis the the clearclear--cut doctrinal approaches again cut doctrinal approaches again becomes apparentbecomes apparent, together with , together with an effort an effort inin figurfiguringing out the most suitable way for the peculiar condi-out the most suitable way for the peculiar condi-tions. Seemingly, it is definitetions. Seemingly, it is definitely not the classical/liberal approach for ly not the classical/liberal approach for him, but he wasn’t totally compromised by the Keynesian precepts or him, but he wasn’t totally compromised by the Keynesian precepts or Wagner’s prioritiesWagner’s priorities as wellas well..

However, the trademark of the Keynesian revolution that is the em-

However, the trademark of the Keynesian revolution that is the em-phasis on the economic impact among the nonphasis on the economic impact among the non--fiscalfiscal effects of taxation, effects of taxation, makes itself evident in many of the articles. As Professor Besim Üstünel makes itself evident in many of the articles. As Professor Besim Üstünel puts forth, “the last developments in the science prove that, state should puts forth, “the last developments in the science prove that, state should not only appeal to tax as a source of revenue for itselfnot only appeal to tax as a source of revenue for itself,, but it must utilize but it must utilize it as anit as an economic policy instrument”.economic policy instrument”.385 And by Keynes, not only the And by Keynes, not only the fiscal theory and policy has changed but also the philosophy on state’s fiscal theory and policy has changed but also the philosophy on state’s role in economic affairs have undergone a change.role in economic affairs have undergone a change.386 State from then on, State from then on, is expectedis expected to act as a balance wheel.to act as a balance wheel.387 The tax burdenThe tax burden is supposed to is supposed to be alleviated during the economic depression times and increased dur-be alleviated during the economic depression times and increased dur-ing welfare perioding welfare periodss. The redistributive effect and progressive character . The redistributive effect and progressive character of tax come to the forefront.of tax come to the forefront.388 In brief, taxation as an instrument of In brief, taxation as an instrument of economic policy meant to serveconomic policy meant to serve for the economic improvement of the e for the economic improvement of the country: country: fight against inflationfight against inflation,, serve for full employmentserve for full employment and capital and capital accumulation.accumulation.389 It was expected to alleviate It was expected to alleviate the the conjunctural fluctua-conjunctural fluctua-

384 Neumark, Neumark, Maliyeye DairMaliyeye Dair, 36., 36.

385 BesimBesim ÜstüneÜstünel,l, “Gelir ve Servet Vergilerinin “Gelir ve Servet Vergilerinin İİktisadi Tesirleriktisadi Tesirleri,,”” İÜMAMKİÜMAMK, no. 1 (, no. 1 (19551955):): 8787..

386 AhmetAhmet Kılıçbay,Kılıçbay, “İktisat İlminin Gelişmesi Karşısında Maliye Politikasının Aldığı “İktisat İlminin Gelişmesi Karşısında Maliye Politikasının Aldığı İstikametİstikamet,,” ” İÜMAMKİÜMAMK, no. 4 (, no. 4 (19581958):):60.60.

387 CarrolCarrol Shanks, “Amme Harcamaları İktisadi İstikrarı Sağlayabilir mi?Shanks, “Amme Harcamaları İktisadi İstikrarı Sağlayabilir mi?,,” translated by” translated by Reşat Aktan, Reşat Aktan, AÜSBFAÜSBFDD 13, no. 3 (13, no. 3 (19581958):): 7373..

388 KılıçbayKılıçbay, “, “İktisat İlminin Gelişmesiİktisat İlminin Gelişmesi,” ,” 6161..

389 BediBedi Feyzioğlu,Feyzioğlu, “Muamele Vergisi Gelir Vergisinin Yerini Tutabilir mi?“Muamele Vergisi Gelir Vergisinin Yerini Tutabilir mi?,,”” İÜMAMK,İÜMAMK, no. 1 no. 1 ((19551955): ): 5353..

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tions and increase economic productivity, which

tions and increase economic productivity, which would probablywould probably seem seem asas anan insainsanity for the classical thinkers.nity for the classical thinkers.390

4.3.4 Criticisms Against the Current Taxation PoliciesCriticisms Against the Current Taxation Policies

Fritz Neumark assert

Fritz Neumark assertss that the public finance theory, due to that the public finance theory, due to itsits scientific scientific essence, is not supposed to express any opinion on policy making pro-essence, is not supposed to express any opinion on policy making pro-cess. On the other hand, cess. On the other hand, even he himself frequently emphasizeseven he himself frequently emphasizes onon the the political aspect of fiscal actionspolitical aspect of fiscal actions. I. It is not that easy to keep the distance t is not that easy to keep the distance between theory and policy when it is the case of public finance. Besides, between theory and policy when it is the case of public finance. Besides, most of the authors writing in the journals most of the authors writing in the journals wewere also currenre also current/future t/future bureaucrats or policy making actors. This circumstance probably made bureaucrats or policy making actors. This circumstance probably made the emphasis on policy prescriptions and criticisms against the current the emphasis on policy prescriptions and criticisms against the current implementations unavoidable. What is more, a demand for implementations unavoidable. What is more, a demand for a a transfor-transfor-mation in the tax system mation in the tax system iis such a frequs such a frequent theme that negating the con-ent theme that negating the con-tent of these articles and policy recommendations became impossible. tent of these articles and policy recommendations became impossible. Although the principal focus of this dissertation is oriented towards the Although the principal focus of this dissertation is oriented towards the translation/localization of theories, an examination on the policytranslation/localization of theories, an examination on the policy--based based articles articles is also critical, both to see the dominant agenda and is also critical, both to see the dominant agenda and clarify clarify the the implicit theoretical positions behind the policy prescriptions of the aca-implicit theoretical positions behind the policy prescriptions of the aca-demics. demics.

The core of the criticisms against the current taxation policies is re-

The core of the criticisms against the current taxation policies is re-lated with the function of taxation. Ilated with the function of taxation. It is claimed that Turkey t is claimed that Turkey iis among s among the countries in which the social function of taxation should be much the countries in which the social function of taxation should be much more highlighted, whereas the existing precautions were generally more highlighted, whereas the existing precautions were generally shaped by fiscal considerations. In other words, the current policy mak-shaped by fiscal considerations. In other words, the current policy mak-ers were criticers were criticized for confining themselves with foreign credit, fiscal ized for confining themselves with foreign credit, fiscal and monetary measures; instead of transforming the prevalent tax sys-and monetary measures; instead of transforming the prevalent tax sys-tem to cover the increasing expenses. In such a case, only the fiscal tem to cover the increasing expenses. In such a case, only the fiscal

390 Neumark, Neumark, Maliyeye DairMaliyeye Dair, , 185.185.

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viewpoint prevails and the interest of the treasure is consi

viewpoint prevails and the interest of the treasure is considered. The dered. The stability concern in revenues and the maintenance of a general equilib-stability concern in revenues and the maintenance of a general equilib-rium were revealed as priorities.rium were revealed as priorities.391 Such a policy preference reflects the Such a policy preference reflects the classical apprehension of public finance, and the classical apprehension of public finance, and the existence of suchexistence of such harsh harsh criticisms of the academics criticisms of the academics against this kind of an approach is equal to against this kind of an approach is equal to taking a stance against the classical/liberal understanding. Yet, the taking a stance against the classical/liberal understanding. Yet, the principles of principles of equity and productivityequity and productivity wewere borrowed from the classical re borrowed from the classical public finance mentality when evaluating on the taxation policy imple-public finance mentality when evaluating on the taxation policy imple-mmentations.entations.392

As the importance of the economic (increasing productivity), socio-

As the importance of the economic (increasing productivity), socio-political (amelioration of income inequalities, general welfare) and pe-political (amelioration of income inequalities, general welfare) and pe-cuniary (inflationary/deflationary policies) impacts of taxation edge cuniary (inflationary/deflationary policies) impacts of taxation edge upup393, the attention of the academics w, the attention of the academics were drawn to these fields. For a ere drawn to these fields. For a consistent economic improvement of the country, increasing in econom-consistent economic improvement of the country, increasing in econom-ic productivity without putting the loweric productivity without putting the lower--income people into trouble by income people into trouble by means of the inflationary methods means of the inflationary methods wawas appreciated.s appreciated.394 The optimal The optimal framework for taxatframework for taxation then ion then was expected to bewas expected to be shaped within the con-shaped within the con-cerns of productive investments to achieve capital accumulation right cerns of productive investments to achieve capital accumulation right away. In this senseaway. In this sense,, the basic question occurs as whether the direct or the basic question occurs as whether the direct or indirect taxes better serve for this purpose. indirect taxes better serve for this purpose.

Since investment i

Since investment is a prerequisite s a prerequisite forfor development, a prominent development, a prominent point comes out as specifying a tax ratio that would not hinder the in-point comes out as specifying a tax ratio that would not hinder the in-centives for investment of the private entrepreneurs. In the article centives for investment of the private entrepreneurs. In the article which Vedat Eldem examinewhich Vedat Eldem examinedd the relations between direct taxes and the relations between direct taxes and taxpataxpayers, there yers, there existexisteded an emphasis on that the uneconomical tax rates an emphasis on that the uneconomical tax rates run the risk of dampening the spirit entrepreneurship and gains, which run the risk of dampening the spirit entrepreneurship and gains, which

391 Feridun ErginFeridun Ergin,, “Türkiye’de Ha“Türkiye’de Harp Maliyesirp Maliyesi (1939(1939--1942),1942),”” İÜİFM İÜİFM 4, no. 2 (1943): 4, no. 2 (1943): 151151;; EsatEsat Tekeli, “Vergi Politikaları ve Türkiye’de Vergi PolitikasıTekeli, “Vergi Politikaları ve Türkiye’de Vergi Politikası,,”” İÜMAMK, İÜMAMK, no. 4no. 4 ((19581958): ): 66..

392 Feyzioğlu, “Muamele VergisiFeyzioğlu, “Muamele Vergisi,,”” 4242..

393 DikmenDikmen,, “Liberal, Bitaraf“Liberal, Bitaraf,,”” 3737..

394 Üstünel, “Gelir ve ServetÜstünel, “Gelir ve Servet,” ,” 8787..

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wouldould end up with selfend up with self--destruction for the tax.destruction for the tax.395 Memduh Yaşa also Memduh Yaşa also urgeurgedd upon the moderate tax rates for capital accumuupon the moderate tax rates for capital accumulation, which lation, which wawas s supposed to supposed to form a basis form a basis for beneficial investments made by the private for beneficial investments made by the private entrepreneurs if they are given the opportunity.entrepreneurs if they are given the opportunity.396 Lastly, Neumark Lastly, Neumark touchetouchess upon the negative impacts of high direct taxes on psychological upon the negative impacts of high direct taxes on psychological roots of private capital accroots of private capital accumulation not only because it would lead to umulation not only because it would lead to waste but also for the violation of the morals of taxation.waste but also for the violation of the morals of taxation.397 Within this Within this point of view, the indirect taxes, which are levied on consumption of point of view, the indirect taxes, which are levied on consumption of goods and services, goods and services, wewere preferred as they infer the income effect ofre preferred as they infer the income effect of tax tax while direct taxes signify the substitution effect. Indirect taxes while direct taxes signify the substitution effect. Indirect taxes wewere re then acclaimed as they might solve inflationary problems by dampening then acclaimed as they might solve inflationary problems by dampening expenditures and reducing demand.expenditures and reducing demand.398 What is needed here according What is needed here according to the author İsmail Türk, is to stimulate tto the author İsmail Türk, is to stimulate the encouragement of the he encouragement of the working people to work more without being concerned with a high tax working people to work more without being concerned with a high tax incidence forincidence for theirtheir extra work and production.extra work and production.399

Yet, opposite ideas advocating for direct taxes were much more fre-

Yet, opposite ideas advocating for direct taxes were much more fre-quently confronted. For instance, Besim Üstünel stquently confronted. For instance, Besim Üstünel stoodood up for direct tax-up for direct tax-es by claiming that investment levels would not be adversely affected by es by claiming that investment levels would not be adversely affected by increased taxes since the main criteria of the investor are the productiv-increased taxes since the main criteria of the investor are the productiv-ity of that investment and interest rate. As the main points were re-ity of that investment and interest rate. As the main points were re-vealed as both keepinvealed as both keeping the demand and development level upg the demand and development level up ––evocatively evocatively a a Keynesian logiKeynesian logicc –– an antian anti--inflationary tax increase was inflationary tax increase was recommended for development and capital accumulation.recommended for development and capital accumulation.400 Yet, this Yet, this goal would not be attained via indirect taxation which affectgoal would not be attained via indirect taxation which affectss the con-the con-sumption levsumption levels of the masses, but with the implementation of a certain els of the masses, but with the implementation of a certain kind of direct tax, namely the income tax. In addition to these infer-kind of direct tax, namely the income tax. In addition to these infer-

395 VedatVedat EldemEldem, “, “Bir Vergi Reformuna Niçin İhtiyacımız Var?Bir Vergi Reformuna Niçin İhtiyacımız Var?,,”” İÜİFM İÜİFM 10, no. 110, no. 1--4 (1949):4 (1949): 181. 181.

396 Memduh Yaşa, “Vergi Politikası ve İktisadi KalkınmaMemduh Yaşa, “Vergi Politikası ve İktisadi Kalkınma,,” ” İÜİFM İÜİFM 10, no.10, no. 11--4, 59.4, 59.

397 Neumark, “Vergi YüküNeumark, “Vergi Yükü,,”” 260.260.

398 İsmailİsmail TürkTürk,, “İstikrarda Maliye Politikasının Yeri“İstikrarda Maliye Politikasının Yeri ve Rolüve Rolü,,”” AÜSBFAÜSBFDD 15, no. 4 (1960):15, no. 4 (1960): 3131..

399 Ibid.Ibid., , 3737..

400 Üstünel, “Gelir ve ServetÜstünel, “Gelir ve Servet,,”” 8888--8989..

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ences, one can feel the central concern of the authors was averting the

ences, one can feel the central concern of the authors was averting the potential increases in income inequality, by looking atpotential increases in income inequality, by looking at the criticisms the criticisms oriented against the prevalent discrimination in favor of the highoriented against the prevalent discrimination in favor of the high--income people.income people.401 So, such an income tax occurs as the optimal solution So, such an income tax occurs as the optimal solution since it was specified as the only tax that takes the excess income out of since it was specified as the only tax that takes the excess income out of the pockets of highthe pockets of high--income pincome people which would otherwise spent for eople which would otherwise spent for conspicuous consumption leading to inflationary effects.conspicuous consumption leading to inflationary effects.402

The exigence of a tax policy that lowers the tax burden of the indus-

The exigence of a tax policy that lowers the tax burden of the indus-trial investments trial investments wawas also s also emphasizedemphasized by Gülten Kazganby Gülten Kazgan;; but she ar-but she ar-gueguedd against Arthur Lewis’against Arthur Lewis’ claim that a change provided by inflation in claim that a change provided by inflation in the income distribution on behalf of the profitthe income distribution on behalf of the profit--generating class whose generating class whose propensity to invest is highpropensity to invest is high,, contributes to capital accumulation.contributes to capital accumulation.403 Ob-Ob-taining a higher share from the hightaining a higher share from the high--income people income people wawas also deemed s also deemed plplausible both because the ideal income tax primarily fastens on the ausible both because the ideal income tax primarily fastens on the rentier classrentier class404 who doesn’t contribute to development and the main who doesn’t contribute to development and the main actor of economic development actor of economic development wawas conceived as state in s conceived as state in that that current current conditions.conditions.405

Another crucial point is

Another crucial point is revealed asrevealed as thatthat,, the tax revenue doesn’t the tax revenue doesn’t necessarily vanish without any accretion to private industry. Statenecessarily vanish without any accretion to private industry. Statess hahaveve means of employing the tax income for reinforcement of private sector means of employing the tax income for reinforcement of private sector via transferring it to an institution.via transferring it to an institution.406

It is no surprise that another outstanding

It is no surprise that another outstanding propropponent of the income onent of the income tax was Osman Okyar, who was once a student of Keynes in Cambridge. tax was Osman Okyar, who was once a student of Keynes in Cambridge.

401 YaşaYaşa,, “Vergi Politikası“Vergi Politikası,,”” 6060.. TThe highhe high--income earner taxpayers based on gross income income earner taxpayers based on gross income presumptions, pay less amount of tax compared to the taxpayers in the servicpresumptions, pay less amount of tax compared to the taxpayers in the service sector. e sector. Eldem, “Bir Vergi ReformunaEldem, “Bir Vergi Reformuna,,”” 184. 184.

402 SuadSuad Başar, “Toprak Mahsülleri Vergisi KalkıncaBaşar, “Toprak Mahsülleri Vergisi Kalkınca,,”” İÜİFM İÜİFM 7, no. 17, no. 1--4 (4 (19451945): ): 107.107.; ; Üstünel,Üstünel, ““Gelir ve Servet”Gelir ve Servet”, , 9090..

403 Gülten Gülten Kazgan, “Geri Kalmış Memleketlerde Kapital Birikimi ve Vergi PolitikasıKazgan, “Geri Kalmış Memleketlerde Kapital Birikimi ve Vergi Politikası,,”” İÜMAMK, İÜMAMK, no. 6 (no. 6 (19601960):): 8181.. On the contrary, she claims that the inflation lowered the On the contrary, she claims that the inflation lowered the appeal for investments in between the years 1950 and 1960.appeal for investments in between the years 1950 and 1960.

404 Kazgan, “Geri KalmışKazgan, “Geri Kalmış,,” 79” 79..

405 Yaşa, “Türk Gelir Vergisine Müteallik Bazı MeselelerYaşa, “Türk Gelir Vergisine Müteallik Bazı Meseleler,,”” İÜMAMK, İÜMAMK, no. 1no. 1 ((19551955):): 1717..

406 ÜsÜstünel, “Gelir ve Servettünel, “Gelir ve Servet,,” 90” 90..

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Okyar claims that a congruent implementation with the “excess profit

Okyar claims that a congruent implementation with the “excess profit tax” in England might also be applicable in Turkey via high tax rates tax” in England might also be applicable in Turkey via high tax rates even though it might not proeven though it might not procure the expected amounts particularly in cure the expected amounts particularly in the earlier stages.the earlier stages.407 Hence, in addition to translation of theories all Hence, in addition to translation of theories all through the chapter, through the chapter, here here a suggestion on translation of a policy is wit-a suggestion on translation of a policy is wit-nessednessed as wellas well. But at this point an annotation of Neumark is recalled . But at this point an annotation of Neumark is recalled who was of the opinion that the presence of a capitalist mentality is a who was of the opinion that the presence of a capitalist mentality is a prerequisite for a general modern income tax.prerequisite for a general modern income tax.408 Maybe the criticisms Maybe the criticisms regarding the scope and practice of income tax in the following para-regarding the scope and practice of income tax in the following para-graph might be related with absence of such a prgraph might be related with absence of such a proper, rational, capitalist oper, rational, capitalist mentality. mentality.

The enactment of

The enactment of IIncome ncome TTax ax LLaw in 1949 was regarded as a re-aw in 1949 was regarded as a re-formist action, but again criticized for not being predicated on any so-formist action, but again criticized for not being predicated on any so-cial purpose. The tax was mentioned to be designed as a neutral tax, not cial purpose. The tax was mentioned to be designed as a neutral tax, not a product of a product of a doctrinal reform. Yeta doctrinal reform. Yet,, the crucial deficiency of the law the crucial deficiency of the law wawas s identified as its incompliance with the principle of universality.identified as its incompliance with the principle of universality.409 The The criticisms were mostly regarding the exemption of the agricultural sec-criticisms were mostly regarding the exemption of the agricultural sec-tor from the income tax,tor from the income tax,410 despite the high levels odespite the high levels of agricultural in-f agricultural in-vestments.vestments.411 TThe privileged position of agricultural sector in taxation he privileged position of agricultural sector in taxation

407 OsmanOsman Okyar, “Bir İktisadi Siyaset PeşindeOkyar, “Bir İktisadi Siyaset Peşinde,,” ” İÜİFM İÜİFM 8, no. 18, no. 1--4 (1946): 4 (1946): 106. Yet 106. Yet Laufenburger claimLaufenburger claimeded that income tax brings on retardation to capitalist entrepre-that income tax brings on retardation to capitalist entrepre-neurshipneurship. Laufenburger (. Laufenburger (19541954: : 8181)) and it carries the risk of tuand it carries the risk of turning out to be a discre-rning out to be a discre-tionary and arbitrary policy. tionary and arbitrary policy. Laufenburger (1954: Laufenburger (1954: 7373).).

408 Neumark, “Vergi YüküNeumark, “Vergi Yükü,,” 258.” 258.

409 Yaşa, “Türk Gelir VergisineYaşa, “Türk Gelir Vergisine,” ,” 2121;; Feyzioğlu, “Muamele VergisiFeyzioğlu, “Muamele Vergisi,,”” 5656..

410 AydınAydın Yalçın, “Bütçemiz ve İktisadi İstikrarımızYalçın, “Bütçemiz ve İktisadi İstikrarımız,,” ” AÜSBFAÜSBFDD 6, no. 1 (6, no. 1 (19511951): ): 1212;; Tekeli, Tekeli, “Vergi Politikaları“Vergi Politikaları,,”” 77;; Yaşa “Türk Gelir VergisineYaşa “Türk Gelir Vergisine,,” 19” 19..

411 İsmailİsmail Türk, “Vergi Reformumuz Nasıl OlmalıTürk, “Vergi Reformumuz Nasıl Olmalıdır,dır,”” AÜSBFAÜSBFDD 17, no. 2 (1962):17, no. 2 (1962): 1212.. İsmail İsmail Türk, attractTürk, attractss the attention to the underthe attention to the under--taxation of the agricultural sector taxation of the agricultural sector --which which indeed conindeed constitutes 42.6 stitutes 42.6 percentpercent share in national incomeshare in national income-- by claiming that it is not by claiming that it is not taxed proportional to its tax paying ability. Hence, some beneficial results like rational taxed proportional to its tax paying ability. Hence, some beneficial results like rational use of economic sources, economic stability, equitable distribution of income besides use of economic sources, economic stability, equitable distribution of income besides the the financing of development is mentioned to be provided by financing of development is mentioned to be provided by implementing a implementing a set of set of taxation policies for taxation policies for the the agricultural sector. Although the measurability problem in agricultural sector. Although the measurability problem in agriculture is an obstacle in front of the determination process of the tax burden, Türk agriculture is an obstacle in front of the determination process of the tax burden, Türk

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especially during the years th

especially during the years that theat the developmental themes set the agen-developmental themes set the agen-da, was harshly criticized. This release was also criticized for the sake of da, was harshly criticized. This release was also criticized for the sake of the equity principle.the equity principle. It is mentioned in the articles that the income of a It is mentioned in the articles that the income of a villager is not lower than the income of a worker indeed and the dis-villager is not lower than the income of a worker indeed and the dis-crepancy in taxation between these two groups occurs as a problem.crepancy in taxation between these two groups occurs as a problem.412 This problem was also debated by Nicolas Kaldor, a Keynesian econo-This problem was also debated by Nicolas Kaldor, a Keynesian econo-mist who was invited to write a report on the tax system of Turkey. The mist who was invited to write a report on the tax system of Turkey. The famous Kaldor famous Kaldor RReport recommended a reassertion of eport recommended a reassertion of the the public sector public sector to a large extent in economy, increasing the share of state in resource to a large extent in economy, increasing the share of state in resource utilization and distribution, increasing theutilization and distribution, increasing the share of private sector in share of private sector in taxationtaxation andand a progressive taxation for agricultural sectora progressive taxation for agricultural sector, , namely the namely the property tax.property tax.413 But again, the weight of cultural and political norms in But again, the weight of cultural and political norms in policy preferences occurred as an impediment in front of a complete policy preferences occurred as an impediment in front of a complete implementation oimplementation of the prescriptions in the report.f the prescriptions in the report.

iron

ironically claims that the political cadre’s avoidance of tax, used to be acknowledged as ically claims that the political cadre’s avoidance of tax, used to be acknowledged as a principle of public finance as they are also rooted in a principle of public finance as they are also rooted in the the agricultural sectoragricultural sector. Ibid., 11. Ibid., 11--12.12.

412 EldemEldem, , “Bir Vergi Reformuna“Bir Vergi Reformuna,,”” 118787..

413 Türk, “Vergi ReformumuzTürk, “Vergi Reformumuz,,” 14” 14. . AccAccording to reportording to report, i, in determination of tax rates, n determination of tax rates, what what is to be considered is is to be considered is the production potential, not the amount produced. the production potential, not the amount produced. IIf production f production potential can’t be achieved in the absence of capitalpotential can’t be achieved in the absence of capital--intensive production, then the intensive production, then the ones who are not able to pay ones who are not able to pay the rate must sell their lands to the ones capable ofthe rate must sell their lands to the ones capable of mak-mak-inging capitalcapital--intensive production. Then, the tax assessment will be extended but it will intensive production. Then, the tax assessment will be extended but it will inevitably result in proletarianization of the peasants. inevitably result in proletarianization of the peasants. Türk, 14, cited in the Kaldor Türk, 14, cited in the Kaldor Report, 7Report, 7--8. 8. This secondThis second part drew reaction in Turkey and the precautions in the re-part drew reaction in Turkey and the precautions in the re-port was never applied.port was never applied. İsmail Türk, for instance claimİsmail Türk, for instance claimeded that the methods suggested that the methods suggested are not realistic for Turkey in the sense that the potential production power of the are not realistic for Turkey in the sense that the potential production power of the land can’t be well calculated in a country lacking a cadastral organizationland can’t be well calculated in a country lacking a cadastral organization. Ibid., 14.. Ibid., 14.

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§ 4.4 Concluding RemarksConcluding Remarks

While examining the evolution of public finance mentality in Turkey via

While examining the evolution of public finance mentality in Turkey via the textbooks and university journals, the moving parts in the substance the textbooks and university journals, the moving parts in the substance of the material became selfof the material became self--transparent by figuring transparent by figuring out the decennary out the decennary repetitive themes. The articles in the 1930s were mostly oriented to repetitive themes. The articles in the 1930s were mostly oriented to define and discern the concept of finance and taxation via presenting define and discern the concept of finance and taxation via presenting comparative, historical and etymological details. After the tranquility of comparative, historical and etymological details. After the tranquility of the 1930sthe 1930s –– probably becprobably because of the ause of the favorable economic indicators in favorable economic indicators in the course of events the course of events –– we begin to hear the critical voices against the we begin to hear the critical voices against the budgetary approaches and taxation policies during the Wbudgetary approaches and taxation policies during the World orld WWar ar II, II, with an emphasis on the need for fair rates, a progressive income tax with an emphasis on the need for fair rates, a progressive income tax wwithout exemptions and full employment. Therefore, the substantial ithout exemptions and full employment. Therefore, the substantial agenda of the 1940s wagenda of the 1940s wasas shaped by the ongoing impacts of the policies shaped by the ongoing impacts of the policies imposed along economic warfare. By the 1950s and the 1960s, the con-imposed along economic warfare. By the 1950s and the 1960s, the con-cerns for economic productivity ccerns for economic productivity caame to the forefrontme to the forefront together with the together with the developmental agenda and welfare of the country; the role of fiscal poli-developmental agenda and welfare of the country; the role of fiscal poli-cy in developmental process increased in importance, and the economic cy in developmental process increased in importance, and the economic and social functions of fiscal instruments were much more emphasized and social functions of fiscal instruments were much more emphasized than before. Through the athan before. Through the articles written in all the decades mentioned, rticles written in all the decades mentioned, the common denominator the common denominator iis the central role attributed to state in man-s the central role attributed to state in man-aging the economy. aging the economy. TThe new economic order after the Whe new economic order after the World orld WWar ar II in-II in-fluenced the conceptualizations regarding the extent, functions and fluenced the conceptualizations regarding the extent, functions and weightweight of state.of state.

In the translated article of Keynesian Oxford economist D. Worswick,

In the translated article of Keynesian Oxford economist D. Worswick, one of the most important progress in intellectual field during the one of the most important progress in intellectual field during the WWorld orld WWar ar II II wawas described as thats described as that,, the economists and administrators the economists and administrators learned to contemplate on the economiclearned to contemplate on the economic phenomena with real values phenomena with real values instead of instead of a a mesh of concepts. Worswick regardmesh of concepts. Worswick regardeded this change as a men-this change as a men-tal salvation.tal salvation.414 Although this is a very assertive discourse, the promi-Although this is a very assertive discourse, the promi-

414 J. N. J. N. Worswick, “İkWorswick, “İktisadi Planlamatisadi Planlama:: Tam İstihdam ve Maliye PolitikasıTam İstihdam ve Maliye Politikası,,” translated by ” translated by Gülten KazganGülten Kazgan,, İÜİFM İÜİFM 14, no. 114, no. 1--4 (1952): 4 (1952): 3939--4040..

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nence of the precepts

nence of the precepts through the articlesthrough the articles that the that the Keynesian approach Keynesian approach mamadede itself implicitself implicitly evident itly evident demonstrates the changedemonstrates the change. And this is not . And this is not only related with the increasing role of state intervention only related with the increasing role of state intervention –– it was even it was even on the agenda of the 1930s Turkey when budget balance was prioritized on the agenda of the 1930s Turkey when budget balance was prioritized and inflationary precautions were avoidedand inflationary precautions were avoided –– but particularbut particularly related ly related with the everwith the ever--expanding impacts of budget, public spending and taxa-expanding impacts of budget, public spending and taxa-tion policies in the economic spheres.tion policies in the economic spheres.

As the public expenditures increased and state intervention is

As the public expenditures increased and state intervention is both both desired anddesired and required by required by the the changing conditions, the dominant view-changing conditions, the dominant view-pointpoints s have have changed and the academics in Turkey didn’t remain unre-changed and the academics in Turkey didn’t remain unre-sponsive to these theoretical shifts. It is mentioned that the scope of sponsive to these theoretical shifts. It is mentioned that the scope of public economy is not only an economic matter but also a financial, so-public economy is not only an economic matter but also a financial, so-cial and political issue. In other words, it is regarcial and political issue. In other words, it is regarded as a junction point ded as a junction point of these four spheres. From this point of view, thinking on the scope of of these four spheres. From this point of view, thinking on the scope of public economy becomes no different from thinking on the goals and public economy becomes no different from thinking on the goals and functions of state.functions of state.415 Especially after the WEspecially after the World War orld War II, the prominent II, the prominent themes related with fithemes related with fiscal policies of the state concentrated on the fact scal policies of the state concentrated on the fact that that neutrality neutrality in fiscal policy was impossible anymore. It in fiscal policy was impossible anymore. It wawas empha-s empha-sized that the public expenditures, even when they are constant, have sized that the public expenditures, even when they are constant, have strong influencestrong influencess on economic actions, in prices and total producon economic actions, in prices and total product.t.416 And budgetAnd budget wawass not only supposed to reflect the production, exchange not only supposed to reflect the production, exchange and distribution policies of the governmentand distribution policies of the government; ; but alsobut also was considered towas considered to constconstiitute the major factor that affects them.tute the major factor that affects them.417

In most of the writings, there are repetitive themes regarding

In most of the writings, there are repetitive themes regarding that that state intervention state intervention ininto economy would bring about better outcomes. to economy would bring about better outcomes. This is not surprising when we think of the political significance of the This is not surprising when we think of the political significance of the period between the 1930s and period between the 1930s and the the 1960s, during when public finance 1960s, during when public finance was considered as a statewas considered as a state--led field. Howeveled field. However, as politician Mümtaz r, as politician Mümtaz Soysal also puts it, one should keep in mind that the statist approach Soysal also puts it, one should keep in mind that the statist approach

415 İsmail İsmail TürkTürk,, “Kamu Ekonomisinin Genişliği İktisadi Mantığı ve Bünyesi“Kamu Ekonomisinin Genişliği İktisadi Mantığı ve Bünyesi,” ,” AÜSBFAÜSBFDD 18, 18, no. 3 (no. 3 (19631963):): 2424..

416 ShanksShanks,, “Amme Harcamaları“Amme Harcamaları,,”” 7272..

417 Laufenburger, “İktisadi TedbirlerinLaufenburger, “İktisadi Tedbirlerin,,” 90” 90..

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was not doctrinaire; it s not doctrinaire; it wawas characterized as planful and conscious. The s characterized as planful and conscious. The increasing role of state in economic life increasing role of state in economic life wawas not occurred by the force of s not occurred by the force of any doctrine oany doctrine or ideology, but came along with the economic and natural r ideology, but came along with the economic and natural development.development.418 The very first task expected from the state The very first task expected from the state wawas a provi-s a provi-sion of operational plan framework for public and private units, orient-sion of operational plan framework for public and private units, orient-ed to national economic developmented to national economic development419 and there and there wawas a substas a substantial ntial political consensus political consensus amongamong the academics on pulling the local economy the academics on pulling the local economy out of economic backwardness as soon as possible. out of economic backwardness as soon as possible.

One final assessment: It is clearly understood that economic policy

One final assessment: It is clearly understood that economic policy is strictly embedded in the institutions that train future prois strictly embedded in the institutions that train future professional fessional economists. Onceeconomists. Once thethe students of the Faculty of Economics, became students of the Faculty of Economics, became economic policy makers at some point. Accordingly, recalling the men-economic policy makers at some point. Accordingly, recalling the men-tion in the first paragraph of the previous section, we should draw at-tion in the first paragraph of the previous section, we should draw at-tention to the fact that most of the authotention to the fact that most of the authors/academics writing in the rs/academics writing in the journals hajournals hadd also bureaucratic or policyalso bureaucratic or policy--making experience at some making experience at some period. The internationally reputable leading figure of this chapter, Fritz period. The internationally reputable leading figure of this chapter, Fritz Neumark, actively worked for the preparation of Income Tax Law. Neumark, actively worked for the preparation of Income Tax Law. Muhlis Ete held MinisMuhlis Ete held Ministry of Trade during the early years of Democrat try of Trade during the early years of Democrat Party period. Orhan Dikmen, who became the dean of Faculty of Eco-Party period. Orhan Dikmen, who became the dean of Faculty of Eco-nomics and Chair of Public Finance, worked as the Minister of Agricul-nomics and Chair of Public Finance, worked as the Minister of Agricul-ture in the technocratic cabinet after ture in the technocratic cabinet after the the military intervention 12 March military intervention 12 March 1971. Besim Üstünel worked for State Planning Organization and held 1971. Besim Üstünel worked for State Planning Organization and held the chair of the chair of DDepartment of epartment of EEconomic conomic PPlanning, in addition to a onelanning, in addition to a one--month duty as the Minister of Finance in 1977. Bedi Feyzioğlu was a month duty as the Minister of Finance in 1977. Bedi Feyzioğlu was a member of chamber of deputies in 1961 and contributedmember of chamber of deputies in 1961 and contributed to the prepa-to the prepa-ration of the most emancipatory constitutionration of the most emancipatory constitution of the countryof the country..420 Aydın Aydın Yalçın was among the founders of Hürriyet PartisiYalçın was among the founders of Hürriyet Partisi (Freedom Party)(Freedom Party) and and became deputy in Adalet Partisibecame deputy in Adalet Partisi (Justice Party)(Justice Party). Memduh Yaşa was the . Memduh Yaşa was the key advisor of Adnan Menderes and fikey advisor of Adnan Menderes and financial advisor of nancial advisor of HürriyetHürriyet news-news-

418 MümtazMümtaz Soysal,Soysal, “Türk İktisadında Devletin Payı ve Rolü,“Türk İktisadında Devletin Payı ve Rolü,”” AÜSBFAÜSBFDD 12, no. 3 (12, no. 3 (19571957):): 2626--2727..

419 IbidIbid.., 35, 35..

420 Yenal Öncel, “Hocamız Prof Dr. Bedi FeyzioğluYenal Öncel, “Hocamız Prof Dr. Bedi Feyzioğlu,,”” İÜMAMK, İÜMAMK, no. 35no. 35 ((19931993): 14.): 14.

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paper.

paper.421 Esat Tekeli was the undersecretary of Ministry of Public Fi-Esat Tekeli was the undersecretary of Ministry of Public Fi-nance in between 1942 and 1943. İsmail Türk was the founding presi-nance in between 1942 and 1943. İsmail Türk was the founding presi-dent of Capital Markets Board and Ahmet Kılıçbay worked as the Senior dent of Capital Markets Board and Ahmet Kılıçbay worked as the Senior Counsellor for EconomCounsellor for Economy of the Presidency in between 1985 and 1989. y of the Presidency in between 1985 and 1989.

All the institutional information about the bureaucratic experience

All the institutional information about the bureaucratic experience of the academics give us clues about what it meanof the academics give us clues about what it meantt to be a public finance to be a public finance economist in theconomist in thatat given setting. Marion Fourcadegiven setting. Marion Fourcade--GourinchasGourinchas in her in her ar-ar-ticle emphasizes the noticeable diversities among the professionaliza-ticle emphasizes the noticeable diversities among the professionaliza-tion and disciplinary development of economics based on the historical tion and disciplinary development of economics based on the historical studies on national economics and claims thatstudies on national economics and claims that::

Contrary to the frequent assumption that economics is universal ontrary to the frequent assumption that economics is universal andand universally shared science, there seems to be considerable universally shared science, there seems to be considerable crosscross--national variation in (1) the timing and nature of the insti-national variation in (1) the timing and nature of the insti-tutionalization of an economic knowledge field, (2) the forms of tutionalization of an economic knowledge field, (2) the forms of professional action of economists and (3) intellectual traditionsprofessional action of economists and (3) intellectual traditions in the discipline of economics.in the discipline of economics.422

This “Bourdieu

This “Bourdieu--inflected approach” coined by the economic thought inflected approach” coined by the economic thought historian Philip Mirowskihistorian Philip Mirowski423 reveals reveals that these variations are the prod-that these variations are the prod-ucts of cultural differences and this is also valid when we think of the ucts of cultural differences and this is also valid when we think of the formation of formation of the institutional environment and professional develop-the institutional environment and professional develop-ment in Turkey. Verging upon the “ment in Turkey. Verging upon the “CContinental Europe” model in es-ontinental Europe” model in es-sencesence, , in which the state occurs as a regulatin which the state occurs as a regulatoryory mechanismmechanism424 and the and the discipline is associated discipline is associated withwith civil service trainingcivil service training425, the , the Turkish caTurkish case se also resembles toalso resembles to thethe British experience whereBritish experience whereinin the political elite was the political elite was recruited from the exclusive prestigious universities and the carriedrecruited from the exclusive prestigious universities and the carried--out out

421 EsfenderEsfender Korkmaz, “HocamıKorkmaz, “Hocamız z Prof. Dr. Prof. Dr. Memduh YaşaMemduh Yaşa,,”” İÜMAMK, İÜMAMK, no. 34 (1991):no. 34 (1991): 1313--14.14.

422 MarionMarion FourcadeFourcade--Gourinchas, Gourinchas, “Politics, Institutional Structures, and the Rise of “Politics, Institutional Structures, and the Rise of Economics: A Comparative StudyEconomics: A Comparative Study,” ,” Theory and Society Theory and Society 30, no. 3 (2001): 330, no. 3 (2001): 39898..

423 Philip Mirowski, “Neoclassics and the Philip Mirowski, “Neoclassics and the OtherOthers,s,” review of ” review of Economists and SocietiesEconomists and Societies by by Marion FourcadeMarion Fourcade,, European Journal of Sociology European Journal of Sociology 50, no. 350, no. 3 (2009): 495.(2009): 495.

424 FourcadeFourcade--GourinchasGourinchas,, “Politics, Institutional Structures“Politics, Institutional Structures,” ,” 401401..

425 IbidIbid., ., 435435..

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activism of economists in the public sphere.

activism of economists in the public sphere.426 TThe field of public fi-he field of public fi-nance is probably the field in which snance is probably the field in which such a resemblance uch a resemblance becomesbecomes evi-evi-dent at most.dent at most.

426 IbidIbid.,., 416416.. What is also worth attention is that most What is also worth attention is that most of mentioned Turkish academics of mentioned Turkish academics have been at the universities of London for educational purposes at some point in have been at the universities of London for educational purposes at some point in their lives. their lives.

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5 Sociology and Sociology and Social Policy Social Policy

n this chapter, the evolution of

n this chapter, the evolution of social policy social policy (içtimai siyaset)(içtimai siyaset) which which had an important place in economics particularly after the Whad an important place in economics particularly after the World orld WWar ar I I will be examined. A conceptualization of “economics” disregard-will be examined. A conceptualization of “economics” disregard-ing the “social” aspect was not an imaginable thing in the 1930s Turkey. ing the “social” aspect was not an imaginable thing in the 1930s Turkey. In a similar vein, when the In a similar vein, when the FFaculty of aculty of EEconomics was founded, social conomics was founded, social economics/social policy occupied a central position,economics/social policy occupied a central position, the courses on so-the courses on so-ciology and social politics ciology and social politics were were embedded into economics education. embedded into economics education. Presence of sociology as a part of economics curriculPresence of sociology as a part of economics curriculumum is understand-is understand-able, but what able, but what doesdoes such an earlier existence ofsuch an earlier existence of social policysocial policy meanmean in a in a late capitalized country morlate capitalized country more than 70 percent of its population were e than 70 percent of its population were still living in rural areas? What kind of needs might have nourished the still living in rural areas? What kind of needs might have nourished the prominence of social policy? Who were the founding figures of social prominence of social policy? Who were the founding figures of social policy and for what purposes they put forward themes regarding this policy and for what purposes they put forward themes regarding this issueissue? How the scope and content of social policy was conceptualized, ? How the scope and content of social policy was conceptualized, whwhatat factors occurred as boundaries? What appeared as the key ele-factors occurred as boundaries? What appeared as the key ele-ments and what were the moving parts in this evolutionments and what were the moving parts in this evolutionaryary process? All process? All these will be the main questions of this chapter.these will be the main questions of this chapter.

In se

In seekingeking for answers for these questions, first I will present a his-for answers for these questions, first I will present a his-torical background that torical background that laid the groundworklaid the groundwork for the birth of social poli-for the birth of social poli-

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cy. Then

cy. Then,, various conceptualizations of different schools of thought re-various conceptualizations of different schools of thought re-garding the frame and boundaries of social policgarding the frame and boundaries of social policy will be examined. y will be examined. Next, I will focus on the social policy implementations in Turkey, how Next, I will focus on the social policy implementations in Turkey, how the priorities the priorities have have undergone transformations by the changing socioundergone transformations by the changing socio--economic conditions. economic conditions. TThereafter, the academic material related with hereafter, the academic material related with social policy and sociology asocial policy and sociology as they appears they appeareded in the university journals in the university journals will be analyzed. The ideas of the two founding figures Gerhard Kessler will be analyzed. The ideas of the two founding figures Gerhard Kessler in Istanbul University and Cahit Talas in Mülkiye, who both contributed in Istanbul University and Cahit Talas in Mülkiye, who both contributed a lot a lot toto the construction of a legacy the construction of a legacy regarding regarding social policy in theosocial policy in theoretical retical and practical senses will be presented. Both the common grounds and and practical senses will be presented. Both the common grounds and the differences in their viewpoints will be elaboratedthe differences in their viewpoints will be elaborated by by taking account taking account of the of the temporal temporal gap between their most productive years. Lastly, gap between their most productive years. Lastly, II will will concentrate on the key concepts of concentrate on the key concepts of social policy and expose how these social policy and expose how these concepts were debated among the academics.concepts were debated among the academics.

§ 5.1 The Historical Background of Social PolicyThe Historical Background of Social Policy

As a well

As a well--known fact, industrial revolution began in the late 18known fact, industrial revolution began in the late 18thth centu-centu-ry Britain and changed the whole dynamics of the world econry Britain and changed the whole dynamics of the world economies. The omies. The economic relations transformed from then on and a new world order economic relations transformed from then on and a new world order was created. Inequalities between countries increased by an unprece-was created. Inequalities between countries increased by an unprece-dented scale on the one hand, and the capital and wealth accumulation dented scale on the one hand, and the capital and wealth accumulation on the other. A newon the other. A new--born labor class brougborn labor class brought about new ht about new issueissues in in-s in in-come distribution in this new society. The rules and legal atmosphere of come distribution in this new society. The rules and legal atmosphere of wage determination wage determination then then turned out to be a question.turned out to be a question.1 Economically Economically speaking, it is true that industrial revolution and liberal capitalism rep-speaking, it is true that industrial revolution and liberal capitalism rep-resentresenteded a massiva massive development both in technology and innovation, e development both in technology and innovation,

1 CahitCahit Talas, Talas, Türkiye’nin Açıklamalı Sosyal Politika TarihiTürkiye’nin Açıklamalı Sosyal Politika Tarihi (Ankara:(Ankara: Bilgi Yayınevi, 1992Bilgi Yayınevi, 1992),), 2222..

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changed the living conditions of great masses and made them better off.

changed the living conditions of great masses and made them better off. NeverthelessNevertheless, from another perspective prioritizing the immaterial and , from another perspective prioritizing the immaterial and adverse impacts, we see a picture of a new life routine composedadverse impacts, we see a picture of a new life routine composed of a of a disciplined time, alienation, commodification of labor and masses disciplined time, alienation, commodification of labor and masses whose subsistence were whose subsistence were abandoned to the mercy of the market.abandoned to the mercy of the market. Ger-Ger-hard Kesslerhard Kessler in his article,in his article, portrayportrayeded the historical panorama with some the historical panorama with some impressive details as follows:impressive details as follows:

The industrial r

The industrial revolution was born as a child of enlightenment of evolution was born as a child of enlightenment of the 18the 18thth century with a joyful optimism and the will of progress. century with a joyful optimism and the will of progress. Technology was creating marvelous machines, utilization of new Technology was creating marvelous machines, utilization of new raw materials and mass employment possibilities. Young capital-raw materials and mass employment possibilities. Young capital-ism had not encism had not encountered the social worries and sorrows yet. ountered the social worries and sorrows yet. Goethe, in his “Wilhelm Meister’s Wanderjahren” was writing Goethe, in his “Wilhelm Meister’s Wanderjahren” was writing about the poetical peaceful life of the cotton weaving home in-about the poetical peaceful life of the cotton weaving home in-dustry near the Zurich Lake in the beginning of the nineteenth dustry near the Zurich Lake in the beginning of the nineteenth century. Selma Lagerlöf incentury. Selma Lagerlöf in her her Gösta BerlingGösta Berlingss was portraying the was portraying the iron industry of the Swedish landlords without touching iron industry of the Swedish landlords without touching upupon on the dark side of the social problems at corresponding times. the dark side of the social problems at corresponding times. However, after a while, the situation has begun to change. The However, after a while, the situation has begun to change. The groans of the children working igroans of the children working in hosiery in Britain, the hunger n hosiery in Britain, the hunger and misery of the linen textile workers in Germany began to at-and misery of the linen textile workers in Germany began to at-tract attention. The residence problem in industrial towns was tract attention. The residence problem in industrial towns was revealed. A son of a fabricator, Friedrich Engels, was describing revealed. A son of a fabricator, Friedrich Engels, was describing the dramatic situation of the Brthe dramatic situation of the British working class in 1844. itish working class in 1844. Workers and bourgeoisie were fighting on the streets of Paris in Workers and bourgeoisie were fighting on the streets of Paris in 1848. The radicalism of the socialist opinion leaders was intimi-1848. The radicalism of the socialist opinion leaders was intimi-dating the entrepreneurs and governments since 1860. The dating the entrepreneurs and governments since 1860. The “Probleme Sociale” was occurred in its pr“Probleme Sociale” was occurred in its present form and three esent form and three generations were still working to have the problem settled.generations were still working to have the problem settled.2

2 Gerhard Gerhard Kessler, “Kapitalizmin Sosyal MeseleleriKessler, “Kapitalizmin Sosyal Meseleleri,,” in” in ÖÖkonominin Bugünkü Meselelerikonominin Bugünkü Meseleleri,, 119119..

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Precautionary protections for the workers were provided, social insur-

Precautionary protections for the workers were provided, social insur-ance and aids emerged, political activities of workers’ parties ance and aids emerged, political activities of workers’ parties have have ccoome me up but the problem was still oup but the problem was still on the agenda to be resolved.n the agenda to be resolved.

In the late 19

In the late 19thth century, various implementations of welfare precau-century, various implementations of welfare precau-tions tions came into the picturecame into the picture among the Western countries. By implying among the Western countries. By implying welfare practices, the British entrepreneurs believed they would welfare practices, the British entrepreneurs believed they would achieve more faith and betachieve more faith and better work by the workers.ter work by the workers.3 In In the the 1880s Lon-1880s Lon-don, profit sharing was practiced. In Bismarckian Germany 1883, the don, profit sharing was practiced. In Bismarckian Germany 1883, the first national compulsory health insurance was implemented. This is first national compulsory health insurance was implemented. This is followed by accident insurance in 1884 and retirement insurance for followed by accident insurance in 1884 and retirement insurance for oldold--aged aaged and disabled in 1889.nd disabled in 1889.4 In the last quarter of the 19In the last quarter of the 19thth century century Germany, we Germany, we see see an organization called an organization called Verein für SoVerein für Sozzialpolitikialpolitik, which , which brought trade unions, political parties and businesses for debating the brought trade unions, political parties and businesses for debating the “social question” and suggested a “third way” betwe“social question” and suggested a “third way” between Manchesteren Manchester lais-lais-sezsez--faire liberalism and socialist revolution.faire liberalism and socialist revolution.5 For Scandinavia, the power For Scandinavia, the power of the masses of the masses was influential was influential in generating welfare and the Scandinavi-in generating welfare and the Scandinavi-an welfare represented a solidarity that embraced the whole society an welfare represented a solidarity that embraced the whole society without considering the without considering the class differences of the citizens by procuring class differences of the citizens by procuring them an equal social assistance the burden of which was mostly based them an equal social assistance the burden of which was mostly based on the tax income. In Scandinavian countries like Denmark, Norway and on the tax income. In Scandinavian countries like Denmark, Norway and

3 https://www.hhttps://www.hetwebsite.net/het/schools/assa.htmetwebsite.net/het/schools/assa.htm, , ““American Academy of Political American Academy of Political and Social Science.and Social Science.”” In Britain, the National Association for the Promotion of Social In Britain, the National Association for the Promotion of Social Sciences was founded in 1857 and American counterpart was founded in 1865 by a Sciences was founded in 1857 and American counterpart was founded in 1865 by a group of social reformgroup of social reformeers.rs.

4 Ivan Berend, Ivan Berend, 20. Yüzyıl Avrupa İktisat Tarihi20. Yüzyıl Avrupa İktisat Tarihi (İstanbul: İş Bankası Kültür Yayınları, (İstanbul: İş Bankası Kültür Yayınları, January 2013), 299January 2013), 299--300. These measures were mostly held for weakening the social-300. These measures were mostly held for weakening the social-ist movement. Bismarckian period is important in the sense that a formal social secu-ist movement. Bismarckian period is important in the sense that a formal social secu-rity system was prrity system was presented then.esented then.

5 https://www.hetwebsite.net/het/schools/verein.htmhttps://www.hetwebsite.net/het/schools/verein.htm, , ““Verein für SozialpolitikVerein für Sozialpolitik””. The . The members of Verein can be categorized as the cheerleaders of the policies of Bismarcki-members of Verein can be categorized as the cheerleaders of the policies of Bismarcki-an government. Among the economists at the founding there were Schmollan government. Among the economists at the founding there were Schmoller, Wagner, er, Wagner, Brentano, Knies etc. Rather than being a center of theoretical work, it tended towards Brentano, Knies etc. Rather than being a center of theoretical work, it tended towards policy making processes.policy making processes.

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Sweden there was a holism between fiscal policies and social policies,

Sweden there was a holism between fiscal policies and social policies, and tax income was utilized for the burden of the social assistance.and tax income was utilized for the burden of the social assistance.6

The 20

The 20thth century was a breaking point. In Thomas Humphrey Mar-century was a breaking point. In Thomas Humphrey Mar-shall’sshall’s7 words, the 18words, the 18thth century fixed the individual freedom and the century fixed the individual freedom and the 1919thth century brought political freedom based on civilcentury brought political freedom based on civil rights. These were rights. These were regarded as prerequisites for the free market economy and capitalism. regarded as prerequisites for the free market economy and capitalism. However, capitalism has created inequalitiesHowever, capitalism has created inequalities;; thus, the presence of so-thus, the presence of so-cial rights turned out to be a universal part of the civil rights as a rectifi-cial rights turned out to be a universal part of the civil rights as a rectifi-er power in 20er power in 20thth ccentury.entury.8 In parallel with Marshall’s periodization, Brit-In parallel with Marshall’s periodization, Brit-ain came out as the first country to implement the compulsory national ain came out as the first country to implement the compulsory national aid plan which was composed of the contributions of employees, em-aid plan which was composed of the contributions of employees, em-ployers and state in 1911.ployers and state in 1911.9 After the WAfter the World orld WWar ar I, Roosevelt in I, Roosevelt in the USA the USA asserted that the democracies are obliged to prove that the practical asserted that the democracies are obliged to prove that the practical functioning of democratic governing has to be identical with ensuring functioning of democratic governing has to be identical with ensuring the maintenance of social security of people.the maintenance of social security of people.10 ILOILO, as a part of , as a part of the the Trea-Trea-ty of Versailles, was founded in 19ty of Versailles, was founded in 1919 in Switzerland to set 19 in Switzerland to set the the interna-interna-tional labor standards for provision of advance in social and economic tional labor standards for provision of advance in social and economic justice with the intent of a universal and permanent peace. With the justice with the intent of a universal and permanent peace. With the

6 Berend, Berend, 20. Yüzyıl Avrupa İktisat20. Yüzyıl Avrupa İktisat, , 301301,, cited cited inin BaldwinBaldwin ((19901990::66). ). Tax income and social Tax income and social politics went hand in hand for a whilepolitics went hand in hand for a while in the world and the historical background of in the world and the historical background of this trend is important. In the scheme of things, the amount of taxes to be collected, this trend is important. In the scheme of things, the amount of taxes to be collected, who the taxpayers should be, the share of direct and indirect taxes in public economy who the taxpayers should be, the share of direct and indirect taxes in public economy were all considered as the parts of were all considered as the parts of a social issue and social politics.a social issue and social politics.

7 Buğra claims that Marshall’s approach fully emphasizes the social rights. The Buğra claims that Marshall’s approach fully emphasizes the social rights. The determination of the boundaries of the social rights will be primarily based on the determination of the boundaries of the social rights will be primarily based on the needs of human, not the economy. needs of human, not the economy. Buğra says that sBuğra says that social policy in this sense is like a ocial policy in this sense is like a trojan trojan horse embedded in capitalism.horse embedded in capitalism. Ayşe BuğraAyşe Buğra, , Kapitalizm, Yoksulluk ve Sosyal Kapitalizm, Yoksulluk ve Sosyal PolitikaPolitika (İstanbul:(İstanbul: İletişim Yayınlarıİletişim Yayınları, 2013), 66., 2013), 66.

8 Berend, Berend, 20. Yüzyıl Avrupa20. Yüzyıl Avrupa, , 305305,, cited cited inin Marshall Marshall ((19501950)). Berend mentions that these . Berend mentions that these sentences are from a seminar held in Unsentences are from a seminar held in University of Cambridge and the basis of these iversity of Cambridge and the basis of these words is the historical evolutionary process of Britain.words is the historical evolutionary process of Britain.

9 IbidIbid.,., 302.302.

10 IbidIbid.,., 302.302. From this point of view, it can be said that he draws attention to the position From this point of view, it can be said that he draws attention to the position of social policies in the socialismof social policies in the socialism--capitacapitalism binary as the capitalism is considered as lism binary as the capitalism is considered as “democratic capitalism”.“democratic capitalism”.

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purpose of obtaining similar working conditions among various coun-

purpose of obtaining similar working conditions among various coun-tries and prevtries and preventing the exploitation of labor in the interdependent enting the exploitation of labor in the interdependent competitive market, adoption of humane conditions and cooperation competitive market, adoption of humane conditions and cooperation wwereere emphasized.emphasized.11

Capitalism and social politics were contextualized accordingly, as the Capitalism and social politics were contextualized accordingly, as the evolution of social policies was closelyevolution of social policies was closely related with the developmental related with the developmental stages of capitalism. As Ernest Mandelstages of capitalism. As Ernest Mandel12 also pointed, the liberal capital-also pointed, the liberal capital-ism of the 19ism of the 19thth century was followed by the imperial capitalism till the century was followed by the imperial capitalism till the mid 20mid 20thth century and yielded social capitalism just after the Second century and yielded social capitalism just after the Second World WarWorld War..13 If the 19If the 19thth century was a breaking point for capitalism and century was a breaking point for capitalism and social policies, the Second World War signifiesocial policies, the Second World War signifiedd the other. This war was the other. This war was even more brutal than the first one and even more brutal than the first one and sixsix years of warfare made pov-years of warfare made pov-erty and misery more visible.erty and misery more visible.14 Yet, the policy makerYet, the policy makers have learnt a lot s have learnt a lot from the previous experiences; and even before the end of the war, a from the previous experiences; and even before the end of the war, a new world order has begun to be identified. new world order has begun to be identified.

The name of Sir William Beveridge came to forefront at these times.

The name of Sir William Beveridge came to forefront at these times. For BeveridgeFor Beveridge15, who was the head of , who was the head of Interministerial SInterministerial Social Insurance ocial Insurance and Joint Services (Bakanlıklararası Sosyal Sigorta ve Birleşik Hizmetler and Joint Services (Bakanlıklararası Sosyal Sigorta ve Birleşik Hizmetler Kurulu Başkanı) since 1941, Kurulu Başkanı) since 1941, the aim of the victory is to live in a better the aim of the victory is to live in a better world and to get rid of poverty by preserving the income levels.world and to get rid of poverty by preserving the income levels. He pre-He pre-pared a report regardpared a report regarding these concerns and the Beveridge Report has ing these concerns and the Beveridge Report has

11 https://www.ilo.org/global/abouthttps://www.ilo.org/global/about--thethe--ilo/history/langilo/history/lang----en/index.htmen/index.htm

12 For the developmental phases of capitalism, see Ernest Mandel, For the developmental phases of capitalism, see Ernest Mandel, Geç KapitalizmGeç Kapitalizm,, Versus Versus Kitap, 2008Kitap, 2008..

13 BerenBerend,d, 20. Yüzyıl Avrupa20. Yüzyıl Avrupa, , 299299, cited , cited inin MandelMandel ((19721972).).

14 Berend quotes the observations of Berend quotes the observations of John Steinbeck, who was a war correspondent in John Steinbeck, who was a war correspondent in London in 1943London in 1943 as follows: as follows: ““the masses learned a lot, they want to be free from the the masses learned a lot, they want to be free from the grip of poverty. Such a freedom meangrip of poverty. Such a freedom means employment opportunities, schools, free medi-s employment opportunities, schools, free medi-cine… will the scine… will the special pecial interestinterestss be dominant? Is somebody accumulating wealth while be dominant? Is somebody accumulating wealth while these people earn 50 dollars per month? The concern of the soldiers is very dramatic, these people earn 50 dollars per month? The concern of the soldiers is very dramatic, they don’t want to find themselves on ththey don’t want to find themselves on the verge of a civil war when they return their e verge of a civil war when they return their countries.countries.”” BerendBerend, , 20. Yüzyıl Avrupa20. Yüzyıl Avrupa, , 302, cited 302, cited inin Steinbeck Steinbeck ((19581958: 7: 755--66).).

15 Sir William Beveridge became the head of LSE in 1919. Berend claims that LSE, which Sir William Beveridge became the head of LSE in 1919. Berend claims that LSE, which was a small institution, turned out to bewas a small institution, turned out to be aa popular social science center under his popular social science center under his gov-gov-ernance. Berend, ernance. Berend, 20. Yüz20. Yüzyıl Avrupayıl Avrupa, , 303.303.

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become a milestone in comprehension of social policy as it reinterpret-become a milestone in comprehension of social policy as it reinterpret-ed the citizenship rights by extending its scope to embrace the employ-ed the citizenship rights by extending its scope to embrace the employ-ment and social security rights. ment and social security rights. Completed in 1942,Completed in 1942, tthe report defenhe report defended ded the exigency of full employment and a comprehensive social aid sys-the exigency of full employment and a comprehensive social aid sys-tem.tem.16 As Gunnar Myrdal also emphasized, the desire for ensuring As Gunnar Myrdal also emphasized, the desire for ensuring equality in economy can be discerned in each sphere and acknowledged equality in economy can be discerned in each sphere and acknowledged as a principle since the end of the war.as a principle since the end of the war.17

The reflect

The reflections of the ideological atmosphere after the Wions of the ideological atmosphere after the World orld WWar ar II II can also be seen in the Philadelphia condition of ILO asserting “Labor is can also be seen in the Philadelphia condition of ILO asserting “Labor is not commoditynot commodity..” For Buğra, this can be considered as the finest point of ” For Buğra, this can be considered as the finest point of the era.the era.18 The principle thatThe principle that asserted asserted “all human be“all human beings; irrespective of ings; irrespective of race, creed or sex, have the right to pursue both their material wellrace, creed or sex, have the right to pursue both their material well--being and their spiritual development in conditions of freedom and dig-being and their spiritual development in conditions of freedom and dig-nity, of economic security and equal opportunity”nity, of economic security and equal opportunity”19 was ensuring a road was ensuring a road map for the following wmap for the following welfare implementations. elfare implementations. As the memories of the As the memories of the great depression and war were still carried around, countries were con-great depression and war were still carried around, countries were con-fronted with the need for precautionary measures. This required a re-fronted with the need for precautionary measures. This required a re-construction of the economic policies. Exhausted economies engaged in construction of the economic policies. Exhausted economies engaged in aa recovery process since then and economic policy makers felt the recovery process since then and economic policy makers felt the need need of of introducing social and holistic concerns. The pure liberal ideology introducing social and holistic concerns. The pure liberal ideology was attacked by Keynesian interventionism and “welfare for every-was attacked by Keynesian interventionism and “welfare for every-one”one”20 becamebecame aa keyword for the new world order, at keyword for the new world order, at least for the de-least for the de-veloped countries in Europe and America. veloped countries in Europe and America.

16 Berend, Berend, 20. Yüzyıl Avrupa20. Yüzyıl Avrupa,, 304304.. Berend mentions that Beveridge was not a partisan. Berend mentions that Beveridge was not a partisan. What is also interesting is, he asked Keynes for advice. It seems like Keynes again oc-What is also interesting is, he asked Keynes for advice. It seems like Keynes again oc-curs as a reference point even for the case of social curs as a reference point even for the case of social policies. Ibpolicies. Ibid., 304.id., 304.

17 IbidIbid., ., 308, cited 308, cited inin Myrdal Myrdal ((19601960: : 3838))..

18 Buğra, Buğra, Kapitalizm, Yoksulluk, Kapitalizm, Yoksulluk, 65.65.

19 https://www.ilo.org/global/abouthttps://www.ilo.org/global/about--thethe--ilo/history/langilo/history/lang----en/index.htmen/index.htm

20 Berend, Berend, 20. Yüzyıl Avrupa 20. Yüzyıl Avrupa 297297, , cited cited inin Erhard Erhard ((19901990:: 246246--99).). For instance, the For instance, the architecarchitect of the German economic miracle Ludwig Erhard was a prominent proponent t of the German economic miracle Ludwig Erhard was a prominent proponent of embeddedness of economic and social policies, emphasizing the critical importance of embeddedness of economic and social policies, emphasizing the critical importance of collective social security and asserting that a competitive free market economy of collective social security and asserting that a competitive free market economy blended by sociblended by social policy precautions would create al policy precautions would create “well“well--being for all.” being for all.” His ideological His ideological

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5.1.1 The Theoretical Challenges AgainstThe Theoretical Challenges Against

The concept and the content of social policy had undergone many

The concept and the content of social policy had undergone many changes since the 19changes since the 19thth century till the 21century till the 21stst..21 The 19The 19thth century was the century was the heyday of political andheyday of political and economic liberalism as already mentioned in the economic liberalism as already mentioned in the previous part. The life changing conditions led to an evident “social previous part. The life changing conditions led to an evident “social problem”, yet the implementation of social policies as a solution for that problem”, yet the implementation of social policies as a solution for that social problem was not a common denominator among the theoristsocial problem was not a common denominator among the theorists. s. The implementation of social policies meant an intervention to the The implementation of social policies meant an intervention to the economy by nature; and as might be expected, the most severe oppo-economy by nature; and as might be expected, the most severe oppo-nents of social policy (especially in Britain and Germany) were com-nents of social policy (especially in Britain and Germany) were com-posed of liberal political economy theoreticians. Whatposed of liberal political economy theoreticians. What the liberals fo-the liberals fo-cused most was the freedom of the “economic man”; disregarding the cused most was the freedom of the “economic man”; disregarding the costs of unrest, imbalances and failures of the hard living and working costs of unrest, imbalances and failures of the hard living and working conditionsconditions22 as the coexistence of poverty and richness was considered as the coexistence of poverty and richness was considered inevitable for the 19inevitable for the 19thth centurycentury liberals.liberals.23 Over and above, they were as-Over and above, they were as-suming the practical implications of social policies as dangerous. suming the practical implications of social policies as dangerous. With With the ithe insistnsistenceence on setting the economy free from any intervention, they on setting the economy free from any intervention, they asserted that there shall not be any other policy implementations, like asserted that there shall not be any other policy implementations, like ssocial policyocial policy,, aside from the liberal economic policies.aside from the liberal economic policies.24 According to According to

stance was close to the ordoliberal ecole, namely the social market economy. Erhard

stance was close to the ordoliberal ecole, namely the social market economy. Erhard worked as the Minister of Economy in Germany between 1949 and 1963. worked as the Minister of Economy in Germany between 1949 and 1963.

21 Tuna and Yalçıntaş mentioned that social policy became a scientific discipline in 1911 Tuna and Yalçıntaş mentioned that social policy became a scientific discipline in 1911 by the German scientist Otto v. Zwiedineckby the German scientist Otto v. Zwiedineck--Südenhorst’s work, namely Südenhorst’s work, namely Social Policy.Social Policy. By By this work, the foundational base and theoretical framework of social policy werethis work, the foundational base and theoretical framework of social policy were iden-iden-tified. Tuna and Yalçıntaş, tified. Tuna and Yalçıntaş, Sosyal Siyaset, Sosyal Siyaset, 25.25.

22 Talas, Talas, Türkiye’ninTürkiye’nin, 20. Talas mentions that in the 20, 20. Talas mentions that in the 20thth century, even liberal economists century, even liberal economists began to make concessions.began to make concessions.

23 BuğraBuğra, , Kapitalizm, YoksullukKapitalizm, Yoksulluk, , 59.59.

24 Gerhard Gerhard Kessler,Kessler, “Sosyal Siyaset ve Eko“Sosyal Siyaset ve Ekonomi Siyaseti,”nomi Siyaseti,” translated by Sabri Ültranslated by Sabri Ülgenergener, , İÜHFMİÜHFM 3 (1937):3 (1937): 11.. Buğra claims that this idea is rooted into the belief that there are Buğra claims that this idea is rooted into the belief that there are

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this view, social order and progress can only be generated by the exist-

this view, social order and progress can only be generated by the exist-ence of economic liberalism and securing the interest of the individual ence of economic liberalism and securing the interest of the individual in a perfectly competitive environment. in a perfectly competitive environment.

To understand the roots of such understand the roots of such a a perception, the nature of the heg-perception, the nature of the heg-emonic economic system in the 19emonic economic system in the 19thth century century –– namely industrial capital-namely industrial capital-ismism-- should be examined with an emphasis on its postulates and as-should be examined with an emphasis on its postulates and as-sumptions. By the rapid industrialization, the displacedsumptions. By the rapid industrialization, the displaced people were people were forced to sell their labor power for subsistence and proletarianization forced to sell their labor power for subsistence and proletarianization occurred. Although the misery of the working class was palpableoccurred. Although the misery of the working class was palpable; ; for the for the 1919thth century liberalism, there was no such thing as working poverty.century liberalism, there was no such thing as working poverty.25 In In other words, if a person other words, if a person is working is working ––despite the potential irregularities despite the potential irregularities or low wagesor low wages-- he should not be considered as poor in the eyes of the he should not be considered as poor in the eyes of the liberals.liberals.

Yet, the most crucial point was not even that.

Yet, the most crucial point was not even that. As Buğra set forth, iAs Buğra set forth, it is t is the question of “what happens to people who cannot earn his living by the question of “what happens to people who cannot earn his living by selling his labor power?” and a secondary question “what happens to selling his labor power?” and a secondary question “what happens to the propertyless person in case he is unable to work/sell his labor just the propertyless person in case he is unable to work/sell his labor just because of illness,because of illness, elderliness or unemployment or his minimum wage elderliness or unemployment or his minimum wage was under the subsistence level?”was under the subsistence level?” These questsThese quests signify an ontological signify an ontological importance/problem for the system and the main subject matter of so-importance/problem for the system and the main subject matter of so-cial policy was precisely related with the existence of this problem. cial policy was precisely related with the existence of this problem. Buğra adds that these are Buğra adds that these are not solely not solely the the questions based on humane questions based on humane concerns but there is a more important question behind indeed: “How concerns but there is a more important question behind indeed: “How

already horizontal relations by means of market system, which annihilate the need for

already horizontal relations by means of market system, which annihilate the need for interventionism. According to this peinterventionism. According to this perspective, the market economy is supposed to rspective, the market economy is supposed to eradicate poverty and generate prosperity to all. Buğra, eradicate poverty and generate prosperity to all. Buğra, KapitalizmKapitalizm,, 57. Social policy 57. Social policy within a right based perspective is not preferred as a solution to the problem of pov-within a right based perspective is not preferred as a solution to the problem of pov-erty as the liberals erty as the liberals wewere suspicious ofre suspicious of state intervention, so the remedies occurred as state intervention, so the remedies occurred as part of philanthropic activity. Buğra,part of philanthropic activity. Buğra, KapitalizmKapitalizm,, 1111--1212..

25 Buğra, Buğra, KapitalizmKapitalizm, 56. Th, 56. This was not the case during the 18is was not the case during the 18thth century. For instance, in century. For instance, in the opinion of Adam the opinion of Adam SmithSmith, , poor poor wawas defined as the one whs defined as the one who must work and sell his o must work and sell his labor for living.labor for living. Yet, iYet, in 1834 Britain, there n 1834 Britain, there wawas the law that rejects the law that rejecteded the concept of the concept of working poor, which separateworking poor, which separatedd the workers from the poor. the workers from the poor. Ibid., 45.Ibid., 45.

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the existence of poor affects the whole social existence?”

the existence of poor affects the whole social existence?”26 Above all, Above all, “who can be defined as poor?”“who can be defined as poor?” Contemplations onContemplations on popotential answers for tential answers for these questions clearly required search for solutions outside the natural these questions clearly required search for solutions outside the natural mechanismmechanism of theof the “self“self--regulating”regulating” market, via social policy and regula-market, via social policy and regula-tory measures.tory measures.

Thus farThus far,, one can see that social policy becomes a field that harasseone can see that social policy becomes a field that harasses s capitalism. As the emphasis shifted from the problem of employment to capitalism. As the emphasis shifted from the problem of employment to the problem of (human) rights, the impact of this harassment increases the problem of (human) rights, the impact of this harassment increases and the essence of the value system becomes the subject matter. In oth-and the essence of the value system becomes the subject matter. In oth-er words; social policy talks about the riger words; social policy talks about the rights of human, independent of hts of human, independent of its labor.its labor.27 And this rightAnd this right--based approach as an entire precautionary based approach as an entire precautionary whole, carries a potential for transforming capitalism. Buğra mentions whole, carries a potential for transforming capitalism. Buğra mentions that the fight is between the ones who try to protect capitalism as it is that the fight is between the ones who try to protect capitalism as it is and the ones and the ones who struggle for transforming it into a “different thing.”who struggle for transforming it into a “different thing.”28

§ 5.2 Social Policy Experience in TurkeySocial Policy Experience in Turkey

5.2.1 Social Policy Implementations in the Ottoman EmpireSocial Policy Implementations in the Ottoman Empire

Till the 19

Till the 19thth century, broad scale social policies in modern sense were century, broad scale social policies in modern sense were not available in any country. Tnot available in any country. The progress of social policy in the Otto-he progress of social policy in the Otto-man Empire began in the 19man Empire began in the 19thth century by the reforms of Mahmud II, century by the reforms of Mahmud II, among which there were among which there were quarantine, smallpox vaccinequarantine, smallpox vaccine and and retirement retirement systemsystem. . As the centralization policies of the rulers expanded in scope, As the centralization policies of the rulers expanded in scope, the role ofthe role of vaqıfs became indistinct. Concrete regulations took place vaqıfs became indistinct. Concrete regulations took place

26 Ibid., Ibid., 1010..

27 BuğraBuğra, , Kapitalizm ,Kapitalizm ,4949..

28 IbidIbid.., 14, 14..

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during the Tanzimat Era, like

during the Tanzimat Era, like Dilaver Paşa NizamnamesiDilaver Paşa Nizamnamesi 18651865 (Dilaver (Dilaver Pasha Regulations)Pasha Regulations), presenting protective measures about working , presenting protective measures about working conditions and 1869 conditions and 1869 Maadin NizamnamesiMaadin Nizamnamesi (Mines Regulations)(Mines Regulations), abo, about ut work safety and work safety and amele tekaüd sandığıamele tekaüd sandığı 18751875 (worker pension fund)(worker pension fund)..29 The philanthropic activity became much more direct in the reign of Ab-The philanthropic activity became much more direct in the reign of Ab-dulhamid II, it was even utilized as a mean of legdulhamid II, it was even utilized as a mean of legitimizaitimization of the pow-tion of the pow-er of the Sultan.er of the Sultan.30 And by the 1908 ConstitutioAnd by the 1908 Constitutional Era, positive concerns nal Era, positive concerns like education, health and social aid came to the forefront in formation like education, health and social aid came to the forefront in formation of a secular public and political sphere.of a secular public and political sphere.31 In addition, philanthropic In addition, philanthropic nongovernmental organizations became widespread in this period, as nongovernmental organizations became widespread in this period, as the number social athe number social aid associations increased. The role of id associations increased. The role of Cemiyetler Cemiyetler KanunuKanunu 1909 is also worth to mention, which 1909 is also worth to mention, which laid the groundworklaid the groundwork for for foundation of civil society initiatives.foundation of civil society initiatives.32

The W

The World orld WWar ar I was a critical period for social policies since the Un-I was a critical period for social policies since the Un-ionists were aware that waionists were aware that war would bring about many social problems r would bring about many social problems which can only be solved by state intervention. The perceptions of the which can only be solved by state intervention. The perceptions of the unionists were reflecting the approach in Bismarckian Germanyunionists were reflecting the approach in Bismarckian Germany33 and and the particularities of German social policy ecole became available by the the particularities of German social policy ecole became available by the wriwritings of nationalist Tekin Alp. Another influential nationalist figure tings of nationalist Tekin Alp. Another influential nationalist figure was Ziya Gökalp, as a representative of Durkheimian ecole based on the was Ziya Gökalp, as a representative of Durkheimian ecole based on the

29 NadirNadir ÖzbekÖzbek,, CCumhuriyet Türkiyesi’nde Sosyal Güvenlik ve Sosyal Politikalarumhuriyet Türkiyesi’nde Sosyal Güvenlik ve Sosyal Politikalar ((İstanbulİstanbul: : Tarih Vakfı, Tarih Vakfı, June June 20062006), 117), 117--118118..

30 M. FM. F.. AysanAysan and A.and A. KayaKaya “Türkiye’de Sosyal Politika Disiplininin ve Uygulamalarının “Türkiye’de Sosyal Politika Disiplininin ve Uygulamalarının GelişimiGelişimi,,” ” Türkiye Araştırmaları Literatür DergisiTürkiye Araştırmaları Literatür Dergisi 6, no. 11 6, no. 11 ((20082008): ): 229229..

31 IbidIbid., ., 230230..

32 İbidİbid., ., 231. However, Özbek mentions that it envisioned a tight control of the 231. However, Özbek mentions that it envisioned a tight control of the government. Özbek, government. Özbek, Cumhuriyet,Cumhuriyet, 118118..

33 Zafer Toprak claims that this içtimai iktisat is the extension of German social Zafer Toprak claims that this içtimai iktisat is the extension of German social democracy. The policies idemocracy. The policies implemented during WWI were real social policies, but not mplemented during WWI were real social policies, but not planned, they were implemented when needed. Özbek,planned, they were implemented when needed. Özbek, CumhuriyetCumhuriyet,, 176176-- 177 Buğra 177 Buğra defines the Bismarckian implementations as corporatist which include the employees defines the Bismarckian implementations as corporatist which include the employees in the formal sector. in the formal sector. Ayşe Ayşe Buğra, “SosBuğra, “Sosyal Politika Düşüncesi İçinde Eşitliğin Yeri ve yal Politika Düşüncesi İçinde Eşitliğin Yeri ve Günümüz Türkiye’sindeki EşitsizliklerGünümüz Türkiye’sindeki Eşitsizlikler,,” in ” in Kalkınma İktisadının Penceresinden Türki-Kalkınma İktisadının Penceresinden Türki-ye’ye Bakmak,ye’ye Bakmak, eds. Hasan Cömert, Emre Özçelik, Ebru Voyvodaeds. Hasan Cömert, Emre Özçelik, Ebru Voyvoda (İstanbul: İletişim (İstanbul: İletişim Yayınları, 2017)Yayınları, 2017),, 3636..

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ideal of solidarism.

ideal of solidarism.34 These two names are important in the sense that These two names are important in the sense that the views of Alp and Gökalp can be considerethe views of Alp and Gökalp can be considered as the very first exam-d as the very first exam-ples of the institutionalization social policy discipline till the 1930s.ples of the institutionalization social policy discipline till the 1930s.35 The characteristic feature of the approaches then was the interioriza-The characteristic feature of the approaches then was the interioriza-tion of social solidarity against tion of social solidarity against the the stimulation of class conflict.stimulation of class conflict.36

5.2.2 Social Question Social Question during the Single Party Periodduring the Single Party Period

The general framework of the social policy approach during this period

The general framework of the social policy approach during this period wawas determined by the problems remained from a war weary collapsed s determined by the problems remained from a war weary collapsed empire with a limited institutional framework. At the center lieempire with a limited institutional framework. At the center liedd the the underpopulation underpopulation problem as population was considered as the source problem as population was considered as the source of economic power. The capacity, health, welfare and moral norms of economic power. The capacity, health, welfare and moral norms con-con-stitutedstituted the main agendathe main agenda;; hencehence,, policies oriented to population in-policies oriented to population in-crease and proactive public health measures turned out to be the prom-crease and proactive public health measures turned out to be the prom-iinent concerns renent concerns regarding the garding the social policy framework.social policy framework.37 Child issue was Child issue was considered as a matter of urgency as well, since upbringing and training considered as a matter of urgency as well, since upbringing and training of children of children wewere considered as significant parts of nation building pro-re considered as significant parts of nation building pro-cess.cess.38 In pursuit of increasing the producIn pursuit of increasing the productive population, birth rates tive population, birth rates

34 Solidarism deals wiSolidarism deals with how unity and order can be provided in a society. In this logic, th how unity and order can be provided in a society. In this logic, the individual is considered as a part of the society. Gökalp arguethe individual is considered as a part of the society. Gökalp arguedd that state is ex-that state is ex-pected to intervene the social life by regulatory and directive functions. Individual pected to intervene the social life by regulatory and directive functions. Individual property should bproperty should be considered together with the public property and the surplus val-e considered together with the public property and the surplus val-ue extracted from the public enterprises should be transferred to society via social ue extracted from the public enterprises should be transferred to society via social security, insurance and charitable associations. By the way, social justice would be security, insurance and charitable associations. By the way, social justice would be fulfilled and poor cfulfilled and poor can achieve better life standards. Aysanan achieve better life standards. Aysan and Kaya,and Kaya, “Türkiye’de Sosyal “Türkiye’de Sosyal PolitikaPolitika,” ,” 232232..

35 Aysan Aysan and Kaya, and Kaya, “Türkiye’de Sosyal Politika“Türkiye’de Sosyal Politika,” ,” 232232..

36 AA continuity continuity ffrom the rom the UUnionists nionists can be seen can be seen as they also implemented regulations that as they also implemented regulations that prevent the right to strikprevent the right to strike and unionization by the 1909 Tatile and unionization by the 1909 Tatil--i Eşgali Eşgal Kanunu (Ottoman Kanunu (Ottoman Strike Law).Strike Law).

37 Özbek, Özbek, Cumhuriyet, Cumhuriyet, 8989..

38 Ibid.,Ibid., 9696..

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were increased as death rates were lowered via public health policies

were increased as death rates were lowered via public health policies39, , particularly via prevention of the contagious diseases like malaria, tu-particularly via prevention of the contagious diseases like malaria, tu-berculosis, venereal diseases and plague.berculosis, venereal diseases and plague. Charitable activities by the embeddedness Charitable activities by the embeddedness of public funding and pri-of public funding and pri-vate endowments were vate endowments were also also on the agenda in alleviating poverty. The on the agenda in alleviating poverty. The charities like Kızılaycharities like Kızılay (Red Crescent)(Red Crescent), Çocuk Esirgeme Kurumu , Çocuk Esirgeme Kurumu (Child (Child Welfare Agency) Welfare Agency) and Türk Hava Kurumu and Türk Hava Kurumu (Turkish Air Association) (Turkish Air Association) were were among the ones that operated under state control but not totally fi-among the ones that operated under state control but not totally fi-nanced by pnanced by public funding; as there were strong relations between them ublic funding; as there were strong relations between them and the ruling elites.and the ruling elites.40 The regulations related to the working life was mostly shaped by the The regulations related to the working life was mostly shaped by the 1936 İş Kanunu1936 İş Kanunu (Labor Code)(Labor Code). By rapid industrialization policies and . By rapid industrialization policies and the impact of the Great Depression,the impact of the Great Depression, the embodiment of a new working the embodiment of a new working class required new regulations about the working life.class required new regulations about the working life.41 Constituted Constituted from 148 article, this law comprehended the working relations, basic from 148 article, this law comprehended the working relations, basic principles of social insurance and some rules about social aid. The pre-principles of social insurance and some rules about social aid. The pre-ponderating empponderating emphasis was on an authoritative and prohibitive regula-hasis was on an authoritative and prohibitive regula-tions. Unionism and locktions. Unionism and lock--out was banned and a system of arbitration out was banned and a system of arbitration that providethat providedd state control on disagreements was brought. Agricultural state control on disagreements was brought. Agricultural

39 1924 Merkez Hıfzısıhha Enstitüsü1924 Merkez Hıfzısıhha Enstitüsü (Refik Saydam Hygiene Institute) and (Refik Saydam Hygiene Institute) and 1930 Umumi 1930 Umumi Hıfzısıhha KanunuHıfzısıhha Kanunu (Public Health Law) in Turkey (Public Health Law) in Turkey were were mentioned by Buğra, mentioned by Buğra, Kapital-Kapital-izm, izm, 148.148.

40 Buğra,Buğra, Kapitalizm, Kapitalizm, 142142--148;148; Özbek,Özbek, CumhuriyetCumhuriyet, , 103103.. Özbek quotes Falih Rıfkı Atay’s Özbek quotes Falih Rıfkı Atay’s declamatory words “Himayedeclamatory words “Himaye--i Etfal is the only institution that is occupied with the i Etfal is the only institution that is occupied with the major matter of the major matter of the RRepublic. Which responsibiepublic. Which responsibility of us can have higher importance lity of us can have higher importance than helping the ones who carry this out without any feeling of interest and demon-than helping the ones who carry this out without any feeling of interest and demon-stration? The money they demanded from you is nothing more than a tip and in return stration? The money they demanded from you is nothing more than a tip and in return for these tips, Himayefor these tips, Himaye--i Etfal brings up a populatioi Etfal brings up a population for Turkey.” Falih Rıfkı Atay, “23 n for Turkey.” Falih Rıfkı Atay, “23 Nisan HimayeNisan Himaye--i Etfal Günüdür.” i Etfal Günüdür.” Cumhuriyet KıraatiCumhuriyet Kıraati, 1925., 1925.

41 Özbek claims that the regulations before the Özbek claims that the regulations before the Labor Code (İş Kanunu)Labor Code (İş Kanunu) can be can be characterized as the products of an indecisiveness between paternalism and liberal-characterized as the products of an indecisiveness between paternalism and liberal-iism. How the problematic parts of the employersm. How the problematic parts of the employer--employee relations will be solved was employee relations will be solved was not clarified until then. The introduced laws were indirect and far from being holistic. not clarified until then. The introduced laws were indirect and far from being holistic. Özbek, Özbek, CumhuriyetCumhuriyet, , 126126..

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sector which has 85 sector which has 85 percentpercent share in total employment completely share in total employment completely re-re-mained out of the law.mained out of the law.42

Buğra claims that the field of social policy in a late industrialized

Buğra claims that the field of social policy in a late industrialized country like Turkey has unfolded different from the European path.country like Turkey has unfolded different from the European path.43 First,First, she mentionsshe mentions thethe resemblance of theresemblance of the statestate--society relations society relations toto the the family relations wfamily relations within individual and informal qualifications. Yetithin individual and informal qualifications. Yet,, the the basic difference in Turkey basic difference in Turkey aas identified by Buğra is thats identified by Buğra is that,, the concerns the concerns related to the supply of labor fell behind the economic concernsrelated to the supply of labor fell behind the economic concerns herehere..44 During the Single Party periodDuring the Single Party period,, the main purpose of the gthe main purpose of the government overnment was presented as preventinwas presented as preventing theg the disintegration of the rural areas. Alt-disintegration of the rural areas. Alt-hough we witness a very dedicated desire for rapid industrialization to hough we witness a very dedicated desire for rapid industrialization to construct a national bourgeoisie to be the engine power of national de-construct a national bourgeoisie to be the engine power of national de-velopment, the emergence of a freevelopment, the emergence of a free labor market was somehow re-labor market was somehow re-stricted by these policies. stricted by these policies.

The second issue is related to the approach against the concept of

The second issue is related to the approach against the concept of poverty. Alleviating poverty was regarded more as a part of the philan-poverty. Alleviating poverty was regarded more as a part of the philan-thropic activity instead of a responsibility of government.thropic activity instead of a responsibility of government.45 BBuğra uğra claims that voluntary charity of the 19claims that voluntary charity of the 19thth century liberalism is very simi-century liberalism is very simi-lar to the approach against poverty adopted in the early years of the lar to the approach against poverty adopted in the early years of the

42 Aysan Aysan and Kaya,and Kaya, “Türkiye’de Sosyal Politika“Türkiye’de Sosyal Politika,” ,” 234. For234. For a a detailed information about detailed information about Labor Code,Labor Code, seesee Özbek, Özbek, CumhuriyetCumhuriyet, , 132132--136136..

43 BuğraBuğra, , Kapitalizm, Kapitalizm, 14. She claims that there was a commodification process in Europe 14. She claims that there was a commodification process in Europe and an inversion of that commodification afterwards. Together with the spread of and an inversion of that commodification afterwards. Together with the spread of private property, common fields disappeared and social policy strived to establish a private property, common fields disappeared and social policy strived to establish a new cnew common ground at this point. As for the lately capitalized countries, patronage ommon ground at this point. As for the lately capitalized countries, patronage relations and unequal corporatist social insurance systems comes to the forefront.relations and unequal corporatist social insurance systems comes to the forefront.

44 Buğra,Buğra, KapitalizmKapitalizm, 100., 100.

45 Aysan and Kaya, “Türkiye’de Sosyal PolitikaAysan and Kaya, “Türkiye’de Sosyal Politika,,” 233” 233,, cited incited in AyAyşe Buğra, “Devletçi şe Buğra, “Devletçi Dönemde Yoksulluğa Bakış ve Sosyal Politika: ‘Zenginlerimiz NeredeDönemde Yoksulluğa Bakış ve Sosyal Politika: ‘Zenginlerimiz Nerede,,” ” Toplum ve BilimToplum ve Bilim,, ((Kış, 2004Kış, 2004: : 9999). Buğra). Buğra states that the social problems were used to be solved by the states that the social problems were used to be solved by the families and charities. Even the society didn’t feel the need to families and charities. Even the society didn’t feel the need to question the indifference question the indifference of state in the face of rural poverty. The rural people were asking the question “where of state in the face of rural poverty. The rural people were asking the question “where are our rich people?” instead of asking “where is the state?”are our rich people?” instead of asking “where is the state?”..

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Republic.epublic.46 The redistributive policies were somehow disregarded the The redistributive policies were somehow disregarded the urban poverty and the poverty in urban aurban poverty and the poverty in urban areas reas wawas strived to be limited s strived to be limited by the prevention of the spread of rural poverty to urban.by the prevention of the spread of rural poverty to urban.47 During the During the early years of the 1940s, the situation of working poverty was not early years of the 1940s, the situation of working poverty was not pleasant especially because of the warpleasant especially because of the war--economy conditions. Unem-economy conditions. Unem-ployment, irregular workployment, irregular work and low wages were among the problems and low wages were among the problems faced by the segments that must earn their livings by selling their labor faced by the segments that must earn their livings by selling their labor power. power. AlthougAlthoughh there werthere weree severalseveral precautions by the government to precautions by the government to fix the conditions of the workersfix the conditions of the workers, they, they remained insufficient.remained insufficient.

5.2.3 Social PoSocial Policy Implementations since the Second World Warlicy Implementations since the Second World War

Starting with the period after the W

Starting with the period after the World orld WWar ar II, II, a a rightright--based approach based approach for social policy implementations began. During the golden age of capi-for social policy implementations began. During the golden age of capi-talism; the efforts for removal of inequalities, increasing righttalism; the efforts for removal of inequalities, increasing rights for s for workers and peasants, institutionalization of social rights were workers and peasants, institutionalization of social rights were the the main main

46 Buğra,Buğra, Kapitalizm, Kapitalizm, 9898.. The mindset of that period is worth analysis and we The mindset of that period is worth analysis and we are are confronted with them via the literary works of the intelligentsia of that period. One of confronted with them via the literary works of the intelligentsia of that period. One of them is Yakup Kadri Karaosmanoğlu, who was also a member of them is Yakup Kadri Karaosmanoğlu, who was also a member of KadroKadro Journal. In his Journal. In his very popular book very popular book YabanYaban, he focuses on the people living in rural areas who , he focuses on the people living in rural areas who wewere re con-con-sidered as the greatest part of the poor. We see that the author desires to transform sidered as the greatest part of the poor. We see that the author desires to transform them, for the sake of rescuing them both from “themselves”and poverty. In them, for the sake of rescuing them both from “themselves”and poverty. In YabanYaban, the , the villager was portrayed as an “other”villager was portrayed as an “other”,, both with a feeling of guilt and avoidance both with a feeling of guilt and avoidance of en-of en-counter. The illiteracy was blamed for the situation but he also blames the intelligent-counter. The illiteracy was blamed for the situation but he also blames the intelligent-sia. Although education occurs as an important dynamic in eliminating poverty, some sia. Although education occurs as an important dynamic in eliminating poverty, some other structural problems related to social order seem to disappear through the other structural problems related to social order seem to disappear through the book. book. Hence, while the difference in the ways of thinking between these two groups is fre-Hence, while the difference in the ways of thinking between these two groups is fre-quently mentioned by the discourse, the sharp contrast between the urban and rural is quently mentioned by the discourse, the sharp contrast between the urban and rural is once more underlined or reproduced. Buğra, states that this approach resembles a once more underlined or reproduced. Buğra, states that this approach resembles a theme in the theme in the WWestern literature related with the effort to educate the poor via some estern literature related with the effort to educate the poor via some discipline and punish methods in various charities of the Christian World from the 16discipline and punish methods in various charities of the Christian World from the 16thth century to century to the the 2020thth century. Buğra, century. Buğra, KapitalizmKapitalizm, , 107. 107.

47 Buğra,Buğra, KapitalizmKapitalizm, 99, 99--100100..

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concerns not only in the developed world, but also in the developing

concerns not only in the developed world, but also in the developing countries. countries. The arguments and welfare state implementations in interna-The arguments and welfare state implementations in interna-tional level also affected Turkey. Thetional level also affected Turkey. There occurred notable regulations like re occurred notable regulations like foundation of The Ministry of Labor in 1945foundation of The Ministry of Labor in 194548, Worker’s Insurance , Worker’s Insurance Foundation in 1946, The General Directorate of Retirement Fund in Foundation in 1946, The General Directorate of Retirement Fund in 1949.1949.49 Starting from 1946, the unions were allowed although there Starting from 1946, the unions were allowed although there was no strike was no strike oror collecollective bargaining.ctive bargaining.50 During those years, the impact During those years, the impact of anticommunism blow was tangible in Turkey, as Turkey preferred to of anticommunism blow was tangible in Turkey, as Turkey preferred to be on the side of the Western Block.be on the side of the Western Block.

In the 1950s, the urban poverty was still disregarded in the sense

In the 1950s, the urban poverty was still disregarded in the sense that the government mostly focusethat the government mostly focused on the problems of d on the problems of the the rural. How-rural. How-everever;; by the 1950s, the immigration from the rural to urban began, and by the 1950s, the immigration from the rural to urban began, and Democrat Party was not an opponent. Democrat Party was not an opponent. Even soEven so, there were, there were stillstill strong strong ties with the village despite the migration, which means ties with the village despite the migration, which means that that the rural the rural was not twas not totally dissolved. The aliveness of the ruralotally dissolved. The aliveness of the rural--urban linkages was urban linkages was performing a social security function for the rural people.performing a social security function for the rural people.51

48 AysanAysan and Kayaand Kaya, , “Türkiye’de Sosyal Politika“Türkiye’de Sosyal Politika,,” ” 238238, , cited from Özbek,cited from Özbek, 142142.. Sadi Irmak Sadi Irmak was a follower of Beveridge Planwas a follower of Beveridge Plan which emphasizes full employment and universal which emphasizes full employment and universal social security institutions. Unemployment, according to Beveridge evokes a feeling social security institutions. Unemployment, according to Beveridge evokes a feeling of of unusefulness and induces a fear for the future. State is then expected to provide full unusefulness and induces a fear for the future. State is then expected to provide full employment and produce policies for the whole without discrimination, increasing employment and produce policies for the whole without discrimination, increasing faith to the systemfaith to the system. Cited in. Cited in WillWilliiam Beveridge, am Beveridge, Full Employment in a Free Society: AFull Employment in a Free Society: A ReportReport ((London: George Allen& Unwin Ltd, 1944London: George Allen& Unwin Ltd, 1944), ), 248248--252252..

49 Buğra, Buğra, Kapitalizm, Kapitalizm, 161. Buğra mentions that although these are important measures, it 161. Buğra mentions that although these are important measures, it should be noted that they address a very limited segment of the society. For instance, should be noted that they address a very limited segment of the society. For instance, while the active labowhile the active labor power was among 14.5 million, the Worker’s Insurance Founda-r power was among 14.5 million, the Worker’s Insurance Founda-tion involved just the 500.000 of them. Buğra, 161tion involved just the 500.000 of them. Buğra, 161, cited, cited in Cahit Talasin Cahit Talas,, “Sosyal Güven-“Sosyal Güven-lik Meselemiz”, lik Meselemiz”, İçtimai Siyaset Konferansları, İçtimai Siyaset Konferansları, 1955. There was no unemployment in-1955. There was no unemployment in-surance or familysurance or family--child aidchild aid. Ibid., 161.. Ibid., 161.

50 These were among the promises of DThese were among the promises of Democrat Party but in the following part of the programs, they were disappeared. The new attitude can be seen in the words of Men-deres: “Bizim memleketimizde sosyal adalet amele davası olmaktan çok çiftçi ve köylü davasıdır.” davasıdır.” (Social justice in our country is more of a peasant and villager case than a (Social justice in our country is more of a peasant and villager case than a worker/laborer case) Buğra, worker/laborer case) Buğra, Kapitalizm,Kapitalizm, 165, cited in Doğan Avcıoğlu, 165, cited in Doğan Avcıoğlu, Türkiye’nin Türkiye’nin Düzeni: Dün, Bugün, Yarın Düzeni: Dün, Bugün, Yarın (İstanbul: Cem Yayınları 2), 617.(İstanbul: Cem Yayınları 2), 617.

51 Buğra, Buğra, Kapitalizm, Kapitalizm, 161655--167.167.

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As for the urban problems in the corresponding decade, the most

As for the urban problems in the corresponding decade, the most outstanding issue appears as the housing problem. Government was outstanding issue appears as the housing problem. Government was reresponded by tolerating shanty houses, which was like an unspoken sponded by tolerating shanty houses, which was like an unspoken agreement between government and the voters in a moral economy agreement between government and the voters in a moral economy framework instead of social policy measures. But they could not attain framework instead of social policy measures. But they could not attain municipality services and housing problem could not be solmunicipality services and housing problem could not be solved. In addi-ved. In addi-tion, health was among the central issues of the government during that tion, health was among the central issues of the government during that period, both the budget of the Ministry of Health and number of hospi-period, both the budget of the Ministry of Health and number of hospi-tals were increased. But again, these rights were owned by the insured tals were increased. But again, these rights were owned by the insured people which constituted the minpeople which constituted the minority indeed and as it became evident ority indeed and as it became evident via the newspapers and journals, there was an absence of demand or via the newspapers and journals, there was an absence of demand or conscience about the rights conscience about the rights regarding this matterregarding this matter..52

1960 was a breaking point for Turkey. After 1960, Turkey enters a

1960 was a breaking point for Turkey. After 1960, Turkey enters a new period under the framework ofnew period under the framework of planned development and import planned development and import substitution strategy. The social rights were secured by the statements substitution strategy. The social rights were secured by the statements of 1961 Constitution. The unionization rightsof 1961 Constitution. The unionization rights andand the right to strike the right to strike were assured in 1963. The industrialization process accelerated, awere assured in 1963. The industrialization process accelerated, a na-na-tional industtional industry was constituted via ry was constituted via import substitution industrializationimport substitution industrialization policies andpolicies and leftist politics was empowered. These went hand in hand leftist politics was empowered. These went hand in hand with the empowering of social rights for the formal sector workers.with the empowering of social rights for the formal sector workers.53 The 1960s and the first half of the 1970s witnessed a conThe 1960s and the first half of the 1970s witnessed a consensus of dif-sensus of dif-ferent classes and every segment of the society haferent classes and every segment of the society hadd more or less re-more or less re-ceived a share from the produced welfare.ceived a share from the produced welfare.54 The workers were not pre-The workers were not pre-occupied with the fear of dismissal and the social security measures occupied with the fear of dismissal and the social security measures were under guarantee.were under guarantee.55 In 1964 by the LaIn 1964 by the Law of Social Insurance, all the w of Social Insurance, all the workers were included under social security measures whether heworkers were included under social security measures whether he/she/she

52 BuğBuğra,ra, Kapitalizm,Kapitalizm, 176. 176.

53 BuğraBuğra, , Kapitalizm, Kapitalizm, 178.178. However, Buğra suggests that the struggle against poverty was However, Buğra suggests that the struggle against poverty was still bounded to the moral economy framework.still bounded to the moral economy framework.

54 AysanAysan and Kayaand Kaya, , “Türkiye’de Sosyal“Türkiye’de Sosyal,” ,” 237237.. The industrial sector waThe industrial sector was protected from s protected from competition, the wages were increased as the right to strike and unionism possibilities competition, the wages were increased as the right to strike and unionism possibilities were gained. Based on the data were gained. Based on the data provided by provided by Pamuk and Owen, the authors claim that Pamuk and Owen, the authors claim that the real wages in between 1963the real wages in between 1963--1977 were doubled.1977 were doubled.

55 AysanAysan and Kayaand Kaya,, “Türkiye’de Sosyal“Türkiye’de Sosyal,” ,” 238238..

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is dependent upon the Labor Law or not, and DISK (Confederation of

is dependent upon the Labor Law or not, and DISK (Confederation of Progressive Trade Unions) was founded in 1967.Progressive Trade Unions) was founded in 1967.56

Despite the acquisitions in social

Despite the acquisitions in social securitsecurity, Buğra claims that there y, Buğra claims that there was no radical change in social aid was no radical change in social aid when we consider how the steps for when we consider how the steps for thethe tax reform applicationstax reform applications ended upended up..57 In fact, Nicholas Kaldor, who In fact, Nicholas Kaldor, who also worked for the Beveridge Report, was invited to prepare a report also worked for the Beveridge Report, was invited to prepare a report on the tax reform. on the tax reform. Kaldor considered the agricultural sector’s exemption Kaldor considered the agricultural sector’s exemption from tax from tax –– despite its weight in economydespite its weight in economy –– as a problem. He suggested a as a problem. He suggested a tax system based on the potential productivity of cultivated land to cre-tax system based on the potential productivity of cultivated land to cre-ate resource for industrialization and social policy. Howeate resource for industrialization and social policy. However, govern-ver, govern-ment rejected this with the fear of rural dissolution.ment rejected this with the fear of rural dissolution.58 It seems like tIt seems like the he solicitude of facing the urban poverty once again prevailed the industri-solicitude of facing the urban poverty once again prevailed the industri-alization process.alization process.

§ 5.3 Social Policy in Academic Texts and JournalsSocial Policy in Academic Texts and Journals

Through this dissertation, the

Through this dissertation, the localization of the dominant economic localization of the dominant economic theories in corresponding periods intheories in corresponding periods in thethe Turkish academiaTurkish academia are are being being traced;traced; and here in this chapter, without rupturing from the theory, and here in this chapter, without rupturing from the theory, II will rather focus on the practices and policy suggestions as this topic is will rather focus on the practices and policy suggestions as this topic is basbased on producing policies by nature. However, one should keep in ed on producing policies by nature. However, one should keep in mind that the theoretical part is embedded in the practical matters for mind that the theoretical part is embedded in the practical matters for

56 Buğra, Buğra, Kapitalizm, Kapitalizm, 178. 178. Social security system was laid but there occurred a binary Social security system was laid but there occurred a binary structure. One is the corporative system that embraced the officials and workers in the structure. One is the corporative system that embraced the officials and workers in the formal sector and the other is the moral economy formal sector and the other is the moral economy --a concept by E.a concept by E. P. ThompsonP. Thompson-- frframework that embodied the needs for the informal sector workers and the poor, amework that embodied the needs for the informal sector workers and the poor, which indeed embodied the greater part of the society. Buğra here annotates that which indeed embodied the greater part of the society. Buğra here annotates that these informal networks were not built upon the notion of social right, but pointed out these informal networks were not built upon the notion of social right, but pointed out the presethe presence of a social inclusion out of the market mechanism. Buğra, nce of a social inclusion out of the market mechanism. Buğra, Kapitalizm, Kapitalizm, 1717..

57 Buğra, Buğra, Kapitalizm, Kapitalizm, 178.178.

58 Ibid., 179.Ibid., 179.

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this subject matter.

this subject matter. It would be meaningfulIt would be meaningful to construct relations be-to construct relations be-tween the practical affairstween the practical affairs –– governmental practicegovernmental practices that were mostly s that were mostly mentioned in previous sectionsmentioned in previous sections –– and the articles, guidance, policy sug-and the articles, guidance, policy sug-gestions of these academics. gestions of these academics.

Till the 1950s

Till the 1950s,, the articles are mostly selected from the Istanbul the articles are mostly selected from the Istanbul University archive and based onUniversity archive and based on the tradition generated by Gerhardthe tradition generated by Gerhard KeKesslerssler. . From then on, although enriched by From then on, although enriched by the the writings of the follow-writings of the follow-ers of Kessler’s tradition and texts from Social Policy Conferences, the ers of Kessler’s tradition and texts from Social Policy Conferences, the main body of the content will be based on Cahit Talas’ books and arti-main body of the content will be based on Cahit Talas’ books and arti-cles. cles.

5.3.1 Gerhard Kessler and “İçtimaiyyat” in Turkey during the Gerhard Kessler and “İçtimaiyyat” in Turkey during the 1930s and 1930s and the the 1940s1940s

If economic policies principally think of commodities, social poli-

If economic policies principally think of commodities, social poli-cy thinks of people first; and we cannot give up any of them. If cy thinks of people first; and we cannot give up any of them. If the students of the new facultythe students of the new faculty wouldwould have propehave properly given the rly given the chance of learning both disciplines properly, the economic and chance of learning both disciplines properly, the economic and social conditions of our country wsocial conditions of our country willill benefit and come out better benefit and come out better off.off.59

These words belong to Gerhard Kessler, a competent German

These words belong to Gerhard Kessler, a competent German émigré émigré professor who was one of the founding figuprofessor who was one of the founding figures of the Faculty of Eco-res of the Faculty of Eco-nomics. Due to the requirements of the historicalnomics. Due to the requirements of the historical context and particu-context and particu-larly because of his larly because of his presencepresence in the faculty, social policy and sociology in the faculty, social policy and sociology were among the eight chairs of the Faculty of Economics in Istanbul were among the eight chairs of the Faculty of Economics in Istanbul

59 Gerhard Kessler, “Sosyal Siyaset ve Ekonomi SiyasetiGerhard Kessler, “Sosyal Siyaset ve Ekonomi Siyaseti,,” translated by Sabri Ülgener, ” translated by Sabri Ülgener, İÜHFMİÜHFM 3, no. 13, no. 1--5 (1937): 5. This is menti5 (1937): 5. This is mentioned by Kessler in the first lesson after the oned by Kessler in the first lesson after the opening lecture of the semesteropening lecture of the semester..

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University as a sign

University as a significant constituent of economics education.ificant constituent of economics education.60 Alt-Alt-hough the term social politics was commonly used in Europe, it was hough the term social politics was commonly used in Europe, it was Kessler, who laid the foundation of this subdiscipline in Turkey.Kessler, who laid the foundation of this subdiscipline in Turkey.61

Born in Eastern Prussia in 1883, Gerhard Kessler studied geography

Born in Eastern Prussia in 1883, Gerhard Kessler studied geography and hisand history before studying economic and social sciences in the Univer-tory before studying economic and social sciences in the Univer-sities of Berlin and Leipzig. He was a professor in Economics in Jena sities of Berlin and Leipzig. He was a professor in Economics in Jena University and as soon as the Hitler regime became the governing force, University and as soon as the Hitler regime became the governing force, Kessler became blacklisted due to his struggle agaiKessler became blacklisted due to his struggle against the national so-nst the national so-cialism. Based on the intervention and invitation of the Ministry of For-cialism. Based on the intervention and invitation of the Ministry of For-eign Affairs in Turkey, he came in Turkey and continued his scientific eign Affairs in Turkey, he came in Turkey and continued his scientific activities here.activities here.62

During his stay in Turkey, he wrote 4 books namely,

During his stay in Turkey, he wrote 4 books namely, İçtimaiyata İçtimaiyata Başlangıç (Başlangıç (IIntroduction to Sociologyntroduction to Sociology)), Kooperatifçilik, Kooperatifçilik (The Cooperative (The Cooperative System)System), Sosyal Siyaset, Sosyal Siyaset (Social Policy)(Social Policy) andand İktisat Tarihiİktisat Tarihi (Economic Histo-(Economic Histo-ry)ry) His assistant Orhan Tuna, mentions that, rather than being the His assistant Orhan Tuna, mentions that, rather than being the products of original views and considerations, these boproducts of original views and considerations, these books were orient-oks were orient-ed to the fulfill the needs of the studentsed to the fulfill the needs of the students.. TThe modern trends in science he modern trends in science were clearly reflected in a didactic manner in these books. In addition to were clearly reflected in a didactic manner in these books. In addition to the hundreds of conference and articles, the two opus of Kessler are the hundreds of conference and articles, the two opus of Kessler are

60 Talas in his book Talas in his book Türkiye’nin Açıklamalı Sosyal Politika TarihiTürkiye’nin Açıklamalı Sosyal Politika Tarihi clarifieclarifiess the reasons the reasons behind the consideration of social policy as an individual branch of science. He first behind the consideration of social policy as an individual branch of science. He first introduces the definition of social policy as a form of economic policy exalted by moral introduces the definition of social policy as a form of economic policy exalted by moral values. For him, the field of economics is the examination of economic activities while values. For him, the field of economics is the examination of economic activities while the field of social policy reflectthe field of social policy reflectss the impacts of the economic activities on sthe impacts of the economic activities on society and ociety and social phenomena they result in. Hence,social phenomena they result in. Hence, argues Talas,argues Talas, social policy can’t remain neutral social policy can’t remain neutral towards these phenomena. It acts as regulatory and equilibratory… the goal of social towards these phenomena. It acts as regulatory and equilibratory… the goal of social policy is to achieve social justice.policy is to achieve social justice. Talas, Talas, 1818--1919..

61 AlpaslanAlpaslan IşıklıIşıklı,, “Sosyal Devlet ve Prof. Dr. Cahit Talas“Sosyal Devlet ve Prof. Dr. Cahit Talas,,” ” Çalışma ve ToplumÇalışma ve Toplum,, no. 1no. 1 ((20072007): ): 2121..

62 OrhanOrhan Tuna, “Gerhard Kessler, Şahsiyeti ve EserleriTuna, “Gerhard Kessler, Şahsiyeti ve Eserleri,,”” İÜİFM İÜİFM 23, no. 323, no. 3--4 (1963): 4 (1963): 66.. Kessler in his own article “Kessler in his own article “Kendi Kendi Hayat Yolum” claimHayat Yolum” claimeded that a book of him againstthat a book of him against the the Hitler regime namely Hitler regime namely Mücadele ve KalkınmaMücadele ve Kalkınma resulted in a dismission from Leipzig Uni-resulted in a dismission from Leipzig Uni-versity. Tunaversity. Tuna, , 77. Kessler in this article. Kessler in this article sasaidid that he is that he is proud of being proud of being the first German the first German professor dismissed during that time.professor dismissed during that time. Gerhard Gerhard KesslerKessler, “Kendi Hayat Yolum,” , “Kendi Hayat Yolum,” İÜİÜSSKD, SSKD, no. 15 (1964): 5.no. 15 (1964): 5.

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remarked as

remarked as Institute fInstitute for Economics and Sociologyor Economics and Sociology and and Library ofLibrary of Facul-Facul-ty of Economicsty of Economics.. His everlasting indebtedness in Turkey and his diligent His everlasting indebtedness in Turkey and his diligent work for developing the country wwork for developing the country wereere acknowledged by his succes-acknowledged by his succes-sors.sors.63

The

The presencepresence of Kessler in the new faculty brought about a change of Kessler in the new faculty brought about a change in in the the approaches approaches regardingregarding social science and sociology. Indeed, the exist-social science and sociology. Indeed, the exist-ing tradition was altered. As Cavit Orhan Tütengil truly identifies, his ing tradition was altered. As Cavit Orhan Tütengil truly identifies, his way of sociology instruction in the university had two idiosyncrasies. way of sociology instruction in the university had two idiosyncrasies. One was his approach to present day sOne was his approach to present day sociology and social relations. ociology and social relations. What lies at the heart of his viewpoint was the “rationality” principle: What lies at the heart of his viewpoint was the “rationality” principle: ““AAll social relations are rational and voluntary relations between peo-ll social relations are rational and voluntary relations between peo-ple…. In my opinion, the roots of the nature of social relations are in ple…. In my opinion, the roots of the nature of social relations are in wisdom… wisdom… TThhere is no social life without rational thinking”.ere is no social life without rational thinking”.64 By saying By saying this, Kessler rejected the deterministic and mechanical frame, instead, this, Kessler rejected the deterministic and mechanical frame, instead, focused on a rationalistic and independent way of sociology education. focused on a rationalistic and independent way of sociology education. For him, sociology is divided into “philosophy of hiFor him, sociology is divided into “philosophy of history” that refers to story” that refers to “the history of society and social dynamics” and “theory of relations” to “the history of society and social dynamics” and “theory of relations” to understand the “reality of society”. The base for the reality of society understand the “reality of society”. The base for the reality of society was portrayed as “the realistic observations”. Although he also conceded was portrayed as “the realistic observations”. Although he also conceded the existence the existence of nonof non--rational elements in social life; for him, society is a rational elements in social life; for him, society is a relation ordered by rational thinking and social coercions can be dimin-relation ordered by rational thinking and social coercions can be dimin-ished via free will.ished via free will.65

Secondly, his impact on reversing the long standing Durkheimian

Secondly, his impact on reversing the long standing Durkheimian tradition is appreciated.tradition is appreciated.66 Although Although the first influences of German soci-the first influences of German soci-

63 Tuna, “Gerhard Kessler,” Tuna, “Gerhard Kessler,” 99..

64 Cavit OrhanCavit Orhan Tütengil, “Ord. Prof Dr. G. Kessler’in Sosyoloji Tarihimizdeki Yeri ve Tütengil, “Ord. Prof Dr. G. Kessler’in Sosyoloji Tarihimizdeki Yeri ve Türkiye’deki Yayınlarının BibliyografyasıTürkiye’deki Yayınlarının Bibliyografyası,,”” İÜİFM İÜİFM 23, no. 323, no. 3--4 (1963):4 (1963): 5252..

65 Sabri Sabri Ülgener, Ülgener, review of “review of “İçtimaiyyİçtimaiyyata Başlangıçata Başlangıç,” by Gerhard Kessler,” by Gerhard Kessler,, İÜİFM, İÜİFM, no. 1 no. 1 (1939):(1939): 281. However, Ülgener argues against this hypothesis by claiming that this 281. However, Ülgener argues against this hypothesis by claiming that this ideal was not realistic as there would be very few cases people act independent from ideal was not realistic as there would be very few cases people act independent from any irrationalities or compulsions. He any irrationalities or compulsions. He questions the validity of establishing içtimaiyyat questions the validity of establishing içtimaiyyat --which is appointed to grasp the reality of the currentwhich is appointed to grasp the reality of the current-- on such an ideal. on such an ideal. Ülgener, Ülgener, 283283..

66 This shift in tradition accomplished by Kessler was perceived as a remarkable change This shift in tradition accomplished by Kessler was perceived as a remarkable change for many academics. Accordifor many academics. According to Sabri Ülgener, the main interesting aspect of Kess-ng to Sabri Ülgener, the main interesting aspect of Kess-

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ology in Turkey can be traced back to the works of Mehmet İzzet, it was

ology in Turkey can be traced back to the works of Mehmet İzzet, it was reputed to be generalized by Kessler. He was oriented to understand life reputed to be generalized by Kessler. He was oriented to understand life and society with the belief that “and society with the belief that “science serves lifescience serves life”. In line with this ”. In line with this ththinking, sociology is supposed to serve “inking, sociology is supposed to serve “the social life of the countrythe social life of the country”. ”. What mostly interested him was “conducting research on the various What mostly interested him was “conducting research on the various and real appearances of social life, instead of thinking about an imagi-and real appearances of social life, instead of thinking about an imagi-nary society nary society while making while making scientific investigscientific investigations.”ations.”67 Accordingly, his Accordingly, his remarkable effort to see those real appearances of the social life at locaremarkable effort to see those real appearances of the social life at local-l-ly ly through the years his stayed in Turkey through the years his stayed in Turkey –– always through that rational-always through that rational-istic and teleological lensistic and teleological lens –– is acknowledged by the academics.is acknowledged by the academics.68

ler’s book is its complete opposite direction towards the former sociological traditions

ler’s book is its complete opposite direction towards the former sociological traditions in the country. The introduction of a system that is utterly dissimilar with the adhered in the country. The introduction of a system that is utterly dissimilar with the adhered Durkheimian sociology Durkheimian sociology is worth appreciation says Ülgener, declaring the need is worth appreciation says Ülgener, declaring the need forfor this. this. ÜlgenerÜlgener,, 277. Fındıkoğlu, in the preface of Kessler’s book also makes a similar com-277. Fındıkoğlu, in the preface of Kessler’s book also makes a similar com-ment. He asserts that the sociology education in high schools were providing a deter-ment. He asserts that the sociology education in high schools were providing a deter-ministic, scientific andministic, scientific and mechanical way of explaining the social phenomena under the mechanical way of explaining the social phenomena under the influence of Ziya Gökalp, while Kessler’s teachings indoctrinates a rationalistic, free influence of Ziya Gökalp, while Kessler’s teachings indoctrinates a rationalistic, free and teleological way of thinkingand teleological way of thinking. Fındıkoğlu, in. Fındıkoğlu, in İçtimaiyata Başlangıçİçtimaiyata Başlangıç by Kessler, 2. by Kessler, 2. Kessler’s averseness Kessler’s averseness against determinism is also acknowledged in Tuna’s article on against determinism is also acknowledged in Tuna’s article on Kessler. Tuna says that being a member of Kessler. Tuna says that being a member of the the social liberal ecole in Europe, Kessler social liberal ecole in Europe, Kessler was an ethicist economist, historian and social politician instead of a doctrinaire scien-was an ethicist economist, historian and social politician instead of a doctrinaire scien-tist. He disesteemstist. He disesteems fate and determinism, believing that all the problems can be solved fate and determinism, believing that all the problems can be solved via willpower with a faith in the Kantian moralism and its universal victory. Orhanvia willpower with a faith in the Kantian moralism and its universal victory. Orhan Tuna, “Gerhard Kessler, ŞahsiyetiTuna, “Gerhard Kessler, Şahsiyeti,” ,” 1111..

67 Tütengil,Tütengil, “Ord. Prof Dr. G. Kessler’“Ord. Prof Dr. G. Kessler’in,”in,” 5353,, cited cited in in İstanbul Üniversitesi Açılış Dersleriİstanbul Üniversitesi Açılış Dersleri (İstanbul, 1933(İstanbul, 1933--119935)35): : 298. Here, we can draw a comparison between the viewpoints 298. Here, we can draw a comparison between the viewpoints of Kessler and Weber. As Buğra, referrof Kessler and Weber. As Buğra, referring to Schumpeter (1954ing to Schumpeter (1954: : 777777)) suggests, the suggests, the natural scientist explains, social scientist interprets. Yet, the concept of “verstehen” is natural scientist explains, social scientist interprets. Yet, the concept of “verstehen” is not only introspective, the submitted hypothesis is expected to be proved via quantita-not only introspective, the submitted hypothesis is expected to be proved via quantita-tive analysis and causality relatitive analysis and causality relations as well. Buğra, ons as well. Buğra, İktisatçılar ve İnsanlar, İktisatçılar ve İnsanlar, 191. 191.

68 Tütengil, “Ord. Prof Dr. G. Kessler’Tütengil, “Ord. Prof Dr. G. Kessler’in”,in”, 54. Even so, the centrality of the rational lenses 54. Even so, the centrality of the rational lenses was interrogated by some academics. For instance, Fındıkoğlu in his article exemplifies was interrogated by some academics. For instance, Fındıkoğlu in his article exemplifies his argument by sayihis argument by saying that Kessler evaluates the cooperatives as a bottom up system ng that Kessler evaluates the cooperatives as a bottom up system inspired by economic rationalism, while Fındıkoğlu’s views were on the contrary. inspired by economic rationalism, while Fındıkoğlu’s views were on the contrary. Fındıkoğlu emphasizes that the reality in Turkey is not yet convenient for such a ra-Fındıkoğlu emphasizes that the reality in Turkey is not yet convenient for such a ra-tional transfiguration andtional transfiguration and the idea of interventionism is apparent in this field the idea of interventionism is apparent in this field as well.as well. Fındıkoğlu, Fındıkoğlu, review of Kessler’s review of Kessler’s KooperatifçilikKooperatifçilik, 1941, 1072., 1941, 1072.

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The main textbook

The main textbook of Kessler, namely of Kessler, namely İçtimaiyata Başlangıçİçtimaiyata Başlangıç,, pub-pub-lished in 1938, was a collection of Kessler’s lectures in Istanbul Univer-lished in 1938, was a collection of Kessler’s lectures in Istanbul Univer-sity. As sity. As previouslypreviously mentioned, this book was critically important in the mentioned, this book was critically important in the sense that it embedded social policy into the field of economicssense that it embedded social policy into the field of economics and and changed the dominant tradition in sociological thinking. The theoretical changed the dominant tradition in sociological thinking. The theoretical importance of Kessler’s book as Ülgener suggests, is related with the importance of Kessler’s book as Ülgener suggests, is related with the system represented in it, namely the science of relations/ the theory of system represented in it, namely the science of relations/ the theory of relations is by all means today’s srelations is by all means today’s sociologyociology.. Such a system is transmitted Such a system is transmitted to the country for the first time via the textbook of Kesslerto the country for the first time via the textbook of Kessler and and helped to helped to clarify Tönnies, Simmel and Max Weber in the eyes of Turkish readersclarify Tönnies, Simmel and Max Weber in the eyes of Turkish readers in in Ülgener’s view.Ülgener’s view.69 The theoretical approach of Kessler was closer to TöThe theoretical approach of Kessler was closer to Tön-n-nies and Weber, and inspired by the conceptual division established by nies and Weber, and inspired by the conceptual division established by Tönnies between Tönnies between ““cemaatcemaat” that considers life as an organic life which ” that considers life as an organic life which holds the individuals live together in a whole (holds the individuals live together in a whole (hayatı, fertleri bütün hayatı, fertleri bütün içinde yaşatan birbirine bağlı tutan uzvi biçinde yaşatan birbirine bağlı tutan uzvi bir hayat olarak görürken) and ir hayat olarak görürken) and ““cemiyetcemiyet”” that refers to a lifestyle interlaced with consciousness of free-that refers to a lifestyle interlaced with consciousness of free-dom, equality and intellect dom, equality and intellect (hürriyet şuurunun, zekanın, eşitlik fikrinin (hürriyet şuurunun, zekanın, eşitlik fikrinin serpiştirildiği bir yaşayış tarzı)serpiştirildiği bir yaşayış tarzı)70, Kessler mainly focuse, Kessler mainly focusedd on the on the ““cemi-cemi-yetyet”” ppart and groundart and groundeded his theoretical framework on the his theoretical framework on the concept of concept of “cemiyet”.“cemiyet”.71

The book

The book,, which which isis evaluated evaluated by Ülgener by Ülgener as a systematic sociology as a systematic sociology treaty, made clear definitions like “sociological situations”treaty, made clear definitions like “sociological situations”,, “sociological “sociological relations”relations” andand “sociological groups and “sociological groups and organizationsorganizations..” It is mostly ” It is mostly agreed that, sociology from then on agreed that, sociology from then on wawas not regarded as a bowl that all s not regarded as a bowl that all the historical, psychological and normative science is poured into; but it the historical, psychological and normative science is poured into; but it turnturned ed out to be a discipline with certain limits and framework.out to be a discipline with certain limits and framework.72 In In

69 Ülgener, Ülgener, review ofreview of İçtimaiyyata Başlangıçİçtimaiyyata Başlangıç, , 277277--278278..

70 Fındıkoğlu “Hukuk ve İçtimaiyyat Tariflerinin KarşılaştırılmasıFındıkoğlu “Hukuk ve İçtimaiyyat Tariflerinin Karşılaştırılması,,” ” İÜHFİÜHFM M 9, no. 19, no. 1--2 2 (1943): (1943): 558558..

71 Sabri Ülgener opposes this by claiming that instead of only focusing to cemiyet, a Sabri Ülgener opposes this by claiming that instead of only focusing to cemiyet, a broader perspective including cemaat would be better.broader perspective including cemaat would be better. Ülgener, review ofÜlgener, review of İçtimaiyyata İçtimaiyyata BaşlangıçBaşlangıç, , 282282--283.283.

72 Ülgener, Ülgener, review ofreview of İçtimaiyyata Bİçtimaiyyata Başlangıçaşlangıç, , 278278..

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addition, s

addition, sociology was not characterized within a dull character since ociology was not characterized within a dull character since then; it gained dynamism, and now referthen; it gained dynamism, and now referredred to an act, a motion, a sci-to an act, a motion, a sci-ence of realities of sociological life.ence of realities of sociological life.73 A reflection of this dynamism man-A reflection of this dynamism man-ifestifestss itself via implementations of social policiesitself via implementations of social policies in order to enhance in order to enhance the whole social life. the whole social life.

Life in Europe had undergone a deep change under the thumb of ife in Europe had undergone a deep change under the thumb of some theories and theoreticians of political economy some theories and theoreticians of political economy ((ekonomi ekonomi siyasetisiyaseti)), namely François Quesnay, Adam Smith, Friedrich List , namely François Quesnay, Adam Smith, Friedrich List and Irving Fisher, Jand Irving Fisher, John Keynes, Gustav Cassel in the current ohn Keynes, Gustav Cassel in the current times. Although the scientific political economy, particularly times. Although the scientific political economy, particularly monetary, fiscal and trade economics monetary, fiscal and trade economics have have existexisteded since 400 since 400 years, social policy is a young branch of science that is more or years, social policy is a young branch of science that is more or less 60 years old.less 60 years old.74

The ab

The abovementioned words of Kessler were from the opening lecture of ovementioned words of Kessler were from the opening lecture of the Faculty of Economics. A remarkable point in this quotation is the the Faculty of Economics. A remarkable point in this quotation is the gap between the years of emergence gap between the years of emergence betweenbetween the scientific political the scientific political economy and social policy. Through his writings, Kessleeconomy and social policy. Through his writings, Kessler elaborater elaboratedd on on why and to what degree social policy is essential and complementary to why and to what degree social policy is essential and complementary to economic policies.economic policies.75 He claims that social policy functions to serve for He claims that social policy functions to serve for

73 Ülgener, Ülgener, review ofreview of İçtimaiyyata Başlangıçİçtimaiyyata Başlangıç, , 279279..

74 Kessler, “Sosyal SiyasetKessler, “Sosyal Siyaset,”,” 11.. It would be meaningful to remind the readers that the 60 It would be meaningful to remind the readers that the 60 years before this opening lecture corresponds to the last quarter of the nineteenth years before this opening lecture corresponds to the last quarter of the nineteenth centurycentury, which, which waswas shaped by the overarching and hoarded impacts of the industrial shaped by the overarching and hoarded impacts of the industrial revolution.revolution. Tuna and Yalçıntaş argue that the theories representing the deterministic Tuna and Yalçıntaş argue that the theories representing the deterministic view, which asserted that the fate of the society can only be changed by revolution, view, which asserted that the fate of the society can only be changed by revolution, retarded the birretarded the birth of voluntaristic social policy, which exclaims the unnecessity of such th of voluntaristic social policy, which exclaims the unnecessity of such a bloody way. Orhan Tuna and Nevzat Yalçıntaş, a bloody way. Orhan Tuna and Nevzat Yalçıntaş, Sosyal Siyaset Sosyal Siyaset (İstanbul: Filiz Kitabevi, (İstanbul: Filiz Kitabevi, 1985), 16.1985), 16.

75 Kessler introduces the following questions Kessler introduces the following questions toto clarify the framework of social clarify the framework of social policy: “Is policy: “Is social policy a product of wrong and irrational ideas that bring about economic losses? social policy a product of wrong and irrational ideas that bring about economic losses? Policies like regulating the contract of employment, delimiting the working hours, Policies like regulating the contract of employment, delimiting the working hours, protecting women and children away from unsuitable work or involving intoprotecting women and children away from unsuitable work or involving into wage wage issues; should they all be regarded as the obligations of state? Should state have a con-issues; should they all be regarded as the obligations of state? Should state have a con-trol over sanitory situations of the business firms? Should it organize sick insurance, trol over sanitory situations of the business firms? Should it organize sick insurance,

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the whole since it brings about an increase in social product.

the whole since it brings about an increase in social product.76 In addi-In addi-tion, it should not be destion, it should not be described as a philanthropic activity for individu-cribed as a philanthropic activity for individu-als or some certain classes, but considered as a task that serves for the als or some certain classes, but considered as a task that serves for the general will.general will.77 Emphasizing the fact that the misery of workers is detri-Emphasizing the fact that the misery of workers is detri-mental for the whole society, he asserts that “worker should be mental for the whole society, he asserts that “worker should be consid-consid-ered as an actor, a subject in the eyes of the state.”ered as an actor, a subject in the eyes of the state.”78 Although an inter-Although an inter-

old

old--age insurance or disabilities insurance, should it oblige the employeage insurance or disabilities insurance, should it oblige the employers insure their rs insure their workers in case of any accidents? In other respects, should it allow the workers to workers in case of any accidents? In other respects, should it allow the workers to organize themselves by establishing trade unions and cooperatives, make collective organize themselves by establishing trade unions and cooperatives, make collective agreements, provide their supplies and construct their houses collectivelagreements, provide their supplies and construct their houses collectively? In short, in y? In short, in addition to the legislative support of the state, should they be allowed to take care of addition to the legislative support of the state, should they be allowed to take care of themselves?themselves?”” Kessler,Kessler, “Sosyal Siyaset“Sosyal Siyaset,” ,” 22.. Indeed, all these questions refer to Kessler’s Indeed, all these questions refer to Kessler’s emphasis on state’s role in social policy, potential fields oemphasis on state’s role in social policy, potential fields of insurance and possibility of f insurance and possibility of cooperative and collective action.cooperative and collective action.

76 Kessler debates on the viewpoints of old liberal economists who assumeKessler debates on the viewpoints of old liberal economists who assumedd that there that there can only be one source within which all the wages are paid in a national economy that can only be one source within which all the wages are paid in a national economy that is the wage fund.is the wage fund. Hence, an increase in Hence, an increase in the the wages of one group necessarily results in a wages of one group necessarily results in a decrease in others within the same ratio. For Kessler, this consideration decrease in others within the same ratio. For Kessler, this consideration iis undoubted-s undoubted-ly wrong. No one can explicitly prove the existence of such a wage fund says Kessler.ly wrong. No one can explicitly prove the existence of such a wage fund says Kessler. And continuesAnd continues as “as “Our collective economic activity has a general consequence that is Our collective economic activity has a general consequence that is called called ‘‘social product’. In the end, all the wealth redistributed among us is nothing social product’. In the end, all the wealth redistributed among us is nothing more than this. The wages, interests, rents and income are all partmore than this. The wages, interests, rents and income are all partss of this conse-of this conse-quence. Money isquence. Money is also nothing more than a transfer made upon this production. Sup-also nothing more than a transfer made upon this production. Sup-pose that the wages are tenfold from tomorrow on, then what will happen to the social pose that the wages are tenfold from tomorrow on, then what will happen to the social product? It will remain the same. However, if the wages are increased slowly step by product? It will remain the same. However, if the wages are increased slowly step by step, the casual worstep, the casual workers would be enabled to enhance their situation at an expense of kers would be enabled to enhance their situation at an expense of the ones that earn their livings by interest and profit. This turned out to be a reality in the ones that earn their livings by interest and profit. This turned out to be a reality in Britain and Germany via the impact of implementation of social policy.Britain and Germany via the impact of implementation of social policy.”” Kessler,Kessler, “Sosyal Siyaset“Sosyal Siyaset,”,” 33..

77 Kessler, “Sosyal SiyasetKessler, “Sosyal Siyaset,” ,” 55. . Here, it is important to focus on the difference of social Here, it is important to focus on the difference of social policy from the philanthropic activity. The policy from the philanthropic activity. The 1919thth century liberals were proponents of century liberals were proponents of existence of charitable activity. This way of thinking was a product of keexistence of charitable activity. This way of thinking was a product of keeping state’s eping state’s hands of the economy. Although it is not clearly indicated, rejection of philanthropic hands of the economy. Although it is not clearly indicated, rejection of philanthropic activity and layactivity and layinging a burden on statea burden on state,, evokes evokes an emphasis on aan emphasis on a rightright--based approachbased approach..

78 Ibid.,Ibid., 44--55.. As we have already mentioned As we have already mentioned about about the commodificationthe commodification process in the process in the 1919thth century, it is understandable that century, it is understandable that for for an individual enterprise, a worker may not an individual enterprise, a worker may not mean anything more than an “object” whose labor is perceived as a commodity. Hencemean anything more than an “object” whose labor is perceived as a commodity. Hence, , naturally entrepreneur/capitalist would try to minimize the cost of tnaturally entrepreneur/capitalist would try to minimize the cost of this commodity. his commodity.

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vention into the functioning of economy via social policy may look like

vention into the functioning of economy via social policy may look like as a disorder or irregularity from the eyes of the liberals, one should as a disorder or irregularity from the eyes of the liberals, one should keep in mind that every irregularkeep in mind that every irregularity that comes out via social policy, is a ity that comes out via social policy, is a result of a primary consideration and protection for the whole societyresult of a primary consideration and protection for the whole society for himfor him. Economy serves for people, and the greatest wealth for Kessler . Economy serves for people, and the greatest wealth for Kessler is defined as the existence of healthy, happy and progressive people. is defined as the existence of healthy, happy and progressive people. ThereforeTherefore,, he argueshe argues that that social policy should be appreciated, because it social policy should be appreciated, because it provides protection to the groups whose prosperity is essential for our provides protection to the groups whose prosperity is essential for our living.living.79

It is

It is claclaimedimed that social policy solved serious social problems in that social policy solved serious social problems in the the Western world during the Western world during the 2020thth century civilizationcentury civilization, by devitalizing the , by devitalizing the radical political movements then.radical political movements then.80 Although the opponents of liberal-Although the opponents of liberal-ism regarded social policy (ism regarded social policy (socialökonomiksocialökonomik) as a treacly falsified and ) as a treacly falsified and degenerated version of economic policies, Kessler mentions that there degenerated version of economic policies, Kessler mentions that there occuroccurred a tendency in Europe to define the science of economics as red a tendency in Europe to define the science of economics as socialökonomik,socialökonomik, all the duties and matters related to economics all the duties and matters related to economics wewere re now flyspecked within their social aspects. A priori discrepancies be-now flyspecked within their social aspects. A priori discrepancies be-tween the social and economic tween the social and economic wewere blurred and this appre blurred and this approach was roach was supported by the implementations in the Western countries. All the supported by the implementations in the Western countries. All the measures and institutions of fiscal policies measures and institutions of fiscal policies wewerere beingbeing specified accord-specified accord-

However, from the eye of the state, which is expected to represent the will of the whole

However, from the eye of the state, which is expected to represent the will of the whole society, that worker cannot be considered as an objectsociety, that worker cannot be considered as an object,, but a subject.but a subject.

79 IbidIbid.., 5, 5.. Such a viewpoint is in accordance with the perspective Buğra presenSuch a viewpoint is in accordance with the perspective Buğra presented for ted for the main problematic of social policy, that is the “problem of living together”, which the main problematic of social policy, that is the “problem of living together”, which arose by the incontestability of the poverty problem by the traditional socialarose by the incontestability of the poverty problem by the traditional social--reciprocal relations. It brought about new policy quest as it turned out to be a preciprocal relations. It brought about new policy quest as it turned out to be a political olitical problem. Buğra, “Sosyal Politika Düşüncesiproblem. Buğra, “Sosyal Politika Düşüncesi,,” in ” in Kalkınma İktisadının Penceresinden Kalkınma İktisadının Penceresinden Türkiye’ye BakmakTürkiye’ye Bakmak, 28, 28..

80 Tuna and Yalçıntaş, Tuna and Yalçıntaş, Sosyal Siyaset, Sosyal Siyaset, 16. Nusret Ekin also emphasizes that social policy16. Nusret Ekin also emphasizes that social policy actsacts as as aa safety value for the sustainability of safety value for the sustainability of capitalism. He claims that the establish-capitalism. He claims that the establish-ment of social policy as a branch of science eradicated the social revolution possibili-ment of social policy as a branch of science eradicated the social revolution possibili-ties lead by Marx and triumphed this bloody war. Therefore, concepts like class strug-ties lead by Marx and triumphed this bloody war. Therefore, concepts like class strug-gle or social classes are no longer the maingle or social classes are no longer the main topic of conversation, especially in the topic of conversation, especially in the aftermath of the World War I. Nusret Ekin, review of aftermath of the World War I. Nusret Ekin, review of Sosyal Siyasete GirişSosyal Siyasete Giriş,, by Orhan by Orhan Tuna,Tuna, İÜİFM İÜİFM 25, no.25, no. 11--2 (1965): 3252 (1965): 325--327.327.

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ing to their social consequences.

ing to their social consequences.81 By saying this, we see Kessler striving By saying this, we see Kessler striving to naturalize the embeddedness oto naturalize the embeddedness of f ““socialsocial”” iinto economics. Here we also nto economics. Here we also see that, Kessler considers social policy as a pragmatic vehicle to safe-see that, Kessler considers social policy as a pragmatic vehicle to safe-guard the existing economic system. On the other hand, we should add guard the existing economic system. On the other hand, we should add a a significantsignificant annotation annotation at this pointat this point: He was not among those who ac-: He was not among those who ac-cepts cepts capitalism as it is, but among the ones who wantcapitalism as it is, but among the ones who wantss to transform it to transform it into a different thing.into a different thing.

Briefly, through Kessler’s book, one can see the effort to establish a

Briefly, through Kessler’s book, one can see the effort to establish a clear framework for the evolution of sociology and social policies. His clear framework for the evolution of sociology and social policies. His lectures, journal articlectures, journal articles and books reflect the dominant tendencies of les and books reflect the dominant tendencies of the era they were written out. The effort for comprehending the reali-the era they were written out. The effort for comprehending the reali-ties of Turkey and constructing a new scientific paradigm dominate the ties of Turkey and constructing a new scientific paradigm dominate the general content of his work. This is understandable in a country thgeneral content of his work. This is understandable in a country that at experienced a revolution and social change in the recent past. Grasping experienced a revolution and social change in the recent past. Grasping the changing dynamics and being among the founding figures in the the changing dynamics and being among the founding figures in the formation of a subdiscipline was a critical responsibility at those times. formation of a subdiscipline was a critical responsibility at those times. His insistence on rationality principle His insistence on rationality principle is coherent with his intention to is coherent with his intention to form “içtimaiyyat” as a scientific discipline based on a consistenform “içtimaiyyat” as a scientific discipline based on a consistentt theory theory of social relationsof social relations82 together with the other chairs in economics educa-together with the other chairs in economics educa-tion. Certainly, he was aware of the social problems in the country; yet tion. Certainly, he was aware of the social problems in the country; yet hishis solution offerssolution offers, , although rational and theoretically validalthough rational and theoretically valid, , were some-were some-times too optimistic. For him, the problems would wither away by im-times too optimistic. For him, the problems would wither away by im-plementation of rational policies and educational measures in the end. plementation of rational policies and educational measures in the end. There is no doubt that this assertion is principThere is no doubt that this assertion is principally correct, but it is not ally correct, but it is not an easy task to form that mental and institutional structure at a stroke.an easy task to form that mental and institutional structure at a stroke.

One last point. In addition to his legacy on sociological theory in

One last point. In addition to his legacy on sociological theory in economics educationeconomics education,, Kessler also wrote about the concrete fields of Kessler also wrote about the concrete fields of

81 Gerhard Gerhard Kessler,Kessler, ““Türkiye’nin İçtimai Siyaset MesTürkiye’nin İçtimai Siyaset Meselelelerine Dair Mülahazalarelerine Dair Mülahazalar,” ,” translated by Orhan Tuna, translated by Orhan Tuna, İÜİFM İÜİFM 2, (19402, (1940): 441;): 441; MuhlisMuhlis Ete,Ete, “Finans İlmine “Finans İlmine Bir Bir Giriş”Giriş”, , 174174.. This trenThis trend started from the second half of the d started from the second half of the 1919thth century. From then on, social century. From then on, social policy started to play an important role in public finance.policy started to play an important role in public finance.

82 GerhardGerhard Kessler, Kessler, İçtimaiyata Başlangıçİçtimaiyata Başlangıç, , translated by Ziyaeddin Fahri Fındıkoğlutranslated by Ziyaeddin Fahri Fındıkoğlu, , (İstanbul: İstanbul Üniversitesi, (İstanbul: İstanbul Üniversitesi, 19319388),), 322322..

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social policy lik

social policy like unionism, social security system and wage issues. In e unionism, social security system and wage issues. In 1946, he participated in 1946, he participated in the the establishment of the first official Turkish establishment of the first official Turkish trade union with his assistant Orhan Tuna in the postwar period.trade union with his assistant Orhan Tuna in the postwar period.83 Fındıkoğlu argues that the ones working in Worker’s Insurance and Fındıkoğlu argues that the ones working in Worker’s Insurance and Employment Agency who studied at the faculty in between 1937 and Employment Agency who studied at the faculty in between 1937 and 1951 and became social policymakers, social insurers, directors and 1951 and became social policymakers, social insurers, directors and officers in the Ministry of Laborofficers in the Ministry of Labor,, should be regarded asshould be regarded as the products of the products of Kessler’s social policy epoch in Turkey.Kessler’s social policy epoch in Turkey.84 He was invited to Ankara to He was invited to Ankara to give conferences on the related themes while Ministy of Labor, Worker give conferences on the related themes while Ministy of Labor, Worker Insurance Institution and Employment Agency. In such an early date like Insurance Institution and Employment Agency. In such an early date like 1945 when there were no uni1945 when there were no unionist movements, he was onist movements, he was an an ardent advo-ardent advo-cate for free unionism. In a period even the word “class” cate for free unionism. In a period even the word “class” wawas regarded s regarded unspeakable says Tuna, Kessler introduced the significance of social unspeakable says Tuna, Kessler introduced the significance of social classes and class consciousness. Yet, he was not a classes and class consciousness. Yet, he was not a proponentproponent of class of class strugglestruggle and depicted social policy as the one and only instrument in and depicted social policy as the one and only instrument in rectifying class struggle by restructuring the law.rectifying class struggle by restructuring the law.85

However, these themes

However, these themes expressed expressed before the Wbefore the World orld WWar ar II somehow II somehow lagged behind the efforts for formation of a sociological theory and con-lagged behind the efforts for formation of a sociological theory and con-textutextual framework for social policy. This is understandable as in the al framework for social policy. This is understandable as in the 1930s and 1930s and the the 1940s Turkey, the 1940s Turkey, the FFaculty of aculty of EEconomics was newly conomics was newly foundfoundeded and an epistemological break from the existing mentality was and an epistemological break from the existing mentality was crystallized. Theoretical framework, definitions and scope crystallized. Theoretical framework, definitions and scope of the field of the field were more of importance. We see a primary effort to fully comprehend were more of importance. We see a primary effort to fully comprehend them in Kessler. Besides, the society consisted of more than 80 percent them in Kessler. Besides, the society consisted of more than 80 percent rural people then and despite the rapid industrialization effort, the in-rural people then and despite the rapid industrialization effort, the in-dustrialization level was too dustrialization level was too much behind the Western countries. As it is much behind the Western countries. As it is

83 Özveren, Özveren, “A Hundred Years,” “A Hundred Years,” 156156..

84 Ziyaeddin Fahri Ziyaeddin Fahri Fındıkoğlu, “Türk Sosyolojisinde İki Alman Sosyologu: Prof Kessler ve Fındıkoğlu, “Türk Sosyolojisinde İki Alman Sosyologu: Prof Kessler ve Prof RüstowProf Rüstow,,” ” İÜİFM İÜİFM 23, no. 323, no. 3--4 (1963): 4 (1963): 4646..

85 TunaTuna,, “Gerhard Kessler, Şahsiyeti ve Eserleri“Gerhard Kessler, Şahsiyeti ve Eserleri,,” 18” 18.. Tuna also mentions tTuna also mentions that the opinions hat the opinions of Kessler might have played a role in of Kessler might have played a role in the the change in Cemiyetler Kanunu and the for-change in Cemiyetler Kanunu and the for-mation of law on trade unions in 1947mation of law on trade unions in 1947. . Ibid., Ibid., 1919. See also Gerhard Kessler, “Türkiye’nin . See also Gerhard Kessler, “Türkiye’nin İçtimai Siyaset Meseleleri,” translated by Orhan Tuna, İçtimai Siyaset Meseleleri,” translated by Orhan Tuna, İÜİFM İÜİFM no. 1 no. 1 (1939): 160.(1939): 160.

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generally accepted that the emergence of social policy requires a certain

generally accepted that the emergence of social policy requires a certain level of industrialization within which a consciousness begins to devel-level of industrialization within which a consciousness begins to devel-op, this incompleteness becomes understandable. After all, immigratop, this incompleteness becomes understandable. After all, immigration ion from rural to urban areas was not a desired thing with the fear of prole-from rural to urban areas was not a desired thing with the fear of prole-tarianization then and Kessler was likeminded as well. He asserted thattarianization then and Kessler was likeminded as well. He asserted that –– again centered around the rationality principleagain centered around the rationality principle-- it is better for a peas-it is better for a peas-ant to stay in the rural; since ifant to stay in the rural; since if the peasant emigrates to the urban areas, the peasant emigrates to the urban areas, the land would not be well cultivated by others. It would also be unsat-the land would not be well cultivated by others. It would also be unsat-isfying for the industry since isfying for the industry since the immigrantthe immigrant would not be able towould not be able to work work thoroughly and perform the expected productivity levels. So, subsidiar-thoroughly and perform the expected productivity levels. So, subsidiar-iies and credits should be paid for the peasants to make them feel satis-es and credits should be paid for the peasants to make them feel satis-fied with their lives and income in rural.fied with their lives and income in rural.86 This sounds theoretically true This sounds theoretically true indeed; but the problem as is known, was multifaceted.indeed; but the problem as is known, was multifaceted.87 Although Although

86 Kessler, “Türkiye’nin İçtimai SiyasetKessler, “Türkiye’nin İçtimai Siyaset,” ,” 450. In fact, this viewpoint shows similarities 450. In fact, this viewpoint shows similarities with the government’s strategy in with the government’s strategy in the the late 1930s andlate 1930s and thethe 1940s. By the fear of prole-1940s. By the fear of prole-tarianization of the peasants, the state preferred peasants stay intarianization of the peasants, the state preferred peasants stay in their villages. We can their villages. We can also see the theoretical support for this view in Orhan Tuna’s also see the theoretical support for this view in Orhan Tuna’s Sosyal Siyaset,Sosyal Siyaset, who con-who con-tinues the tradition of Kessler. As for the state policies based on this approach we can tinues the tradition of Kessler. As for the state policies based on this approach we can count the abolition of count the abolition of TTithe, subsidies provided by Agricithe, subsidies provided by Agricultural Bankultural Bank and theand the founda-founda-tion of village institutes. Based on such precautions, satisfactory living conditions tion of village institutes. Based on such precautions, satisfactory living conditions wewere re expected to be provided for almost the 80 percent of the populationexpected to be provided for almost the 80 percent of the population,, who who were livingwere living in the rural areas. This was mainly because of the fain the rural areas. This was mainly because of the fact the “poor” refers to the peasant ct the “poor” refers to the peasant living in his village in the eyes of the government, which came up with living in his village in the eyes of the government, which came up with a a negation of negation of the the urban poverty. Buğra, urban poverty. Buğra, Kapitalizm, Yoksulluk, Kapitalizm, Yoksulluk, 9999--100.100.

87 Yusuf Saim Yusuf Saim Atasagun, Atasagun, “Türkiye’de İçtimai Siyaset Meseleleri,” “Türkiye’de İçtimai Siyaset Meseleleri,” İÜİFM İÜİFM 2, no2, no. 0 (1940): . 0 (1940): 426426-- 428428.. FoFor Atasagunr Atasagun,, this problem is not that easy to solve, the peasants feel obliged this problem is not that easy to solve, the peasants feel obliged to come to the urban precisely because it is a to come to the urban precisely because it is a requisiterequisite for for the the national economy. The national economy. The production and consumption levels of the family of a peasant who emproduction and consumption levels of the family of a peasant who emigrates to urban igrates to urban are are alsoalso increased by the money the workerincreased by the money the worker--peasant sendpeasant sendss to them. In addition, by the to them. In addition, by the developmental moves since 1923, construction sector developmental moves since 1923, construction sector wawas in need of workers in need of workerss and and most of this need most of this need wawas provided by the peasants. Moreover, it is important s provided by the peasants. Moreover, it is important to mention to mention that the daily wage that the daily wage wawas higher than s higher than the amountthe amount they earn from agriculture. Moreover, they earn from agriculture. Moreover, the ones who emigratethe ones who emigrate toto the urban areas were already landless peasants, a peasant the urban areas were already landless peasants, a peasant who owns a cultivated land would not who owns a cultivated land would not emigrateemigrate that easily. that easily. OOne of the most imne of the most important portant social policy problems in Turkeysocial policy problems in Turkey for himfor him is to scrutinize the issue of working in the is to scrutinize the issue of working in the urbanurban,, without destructing the rural economics with a regulatory planned system. without destructing the rural economics with a regulatory planned system.

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there were some social policy provisions on th

there were some social policy provisions on the agenda, by this way of e agenda, by this way of thinking, the responsibilities of the state wthinking, the responsibilities of the state wereere limited and poverty was limited and poverty was isolated to the rural areas. This was considered as an indicator of the isolated to the rural areas. This was considered as an indicator of the fact that the political concerns preceded the economic ones on this mat-fact that the political concerns preceded the economic ones on this mat-terter88, though wh, though what Kessler presented was an economic reasoning in ap-at Kessler presented was an economic reasoning in ap-pearance.pearance.

Before ending the examination on Kessler, it should be mentioned

Before ending the examination on Kessler, it should be mentioned that his influence persisted many years in the facultythat his influence persisted many years in the faculty89, especially on his , especially on his assistant Orhan Tuna, Aydın Yalçıntaş, Ekmel Zadil; whassistant Orhan Tuna, Aydın Yalçıntaş, Ekmel Zadil; who all continued o all continued and developed his theoretical legacy on social politics and içtimai ikti-and developed his theoretical legacy on social politics and içtimai ikti-sat. Indeed, it was not only the theoretical side they contributed; the sat. Indeed, it was not only the theoretical side they contributed; the academics in the Social Policy Chair also dealt with the actual problems academics in the Social Policy Chair also dealt with the actual problems of the industrializing of the industrializing country. The knowledge produced in the universi-country. The knowledge produced in the universi-ty, played a problem solver role in working life.ty, played a problem solver role in working life.90 From 1948 on, Social From 1948 on, Social Policy Conferences began, within which many papers by Kessler, Policy Conferences began, within which many papers by Kessler, Rüstow, Fındıkoğlu, Tuna, Sabahattin Zaim, Cahit Talas, Bülent Ecevit Rüstow, Fındıkoğlu, Tuna, Sabahattin Zaim, Cahit Talas, Bülent Ecevit

While doing this, the necessities and duties should be diligently elaborated and

While doing this, the necessities and duties should be diligently elaborated and the the connection of the worker with his village should not be cut off.connection of the worker with his village should not be cut off.

88 Buğra, Buğra, Kapitalizm Yoksulluk, Kapitalizm Yoksulluk, 1616..

89 Çiğdem Boz, based on her interviews with the subsequent members of the social Çiğdem Boz, based on her interviews with the subsequent members of the social policy chair,policy chair, mentions that they define Kessler as their academic grmentions that they define Kessler as their academic grandfather and Tuna andfather and Tuna as their academic father. Presence of such an adherence shows the value parted with as their academic father. Presence of such an adherence shows the value parted with these founding figures and the respect to the invented tradition by Kessler.these founding figures and the respect to the invented tradition by Kessler. Ercan Eren, Ercan Eren, “İstanbul’da İktisat Belgeseli ve Türkiye’de İktisadi Düşünce “İstanbul’da İktisat Belgeseli ve Türkiye’de İktisadi Düşünce –– Çiğdem Boz Söyleşisi,” Çiğdem Boz Söyleşisi,” January 14, 2022, videJanuary 14, 2022, video, https://www.youtube.com/watch?v=lBsn3DKopxko, https://www.youtube.com/watch?v=lBsn3DKopxk

90 AysanAysan and Kaya, and Kaya, 239239--240240. . During 1946During 1946--1947, Kessler’s first unionism lectures started.1947, Kessler’s first unionism lectures started. Ibid., 239, cIbid., 239, citedited inin Orhan Tuna, “Kessler Hocanın ÖlümüOrhan Tuna, “Kessler Hocanın Ölümü,,” ” İktisat Fakülteİktisat Fakültesi Sosyal si Sosyal Siyaset KonferanslarıSiyaset Konferansları, 15, Kitap, , 15, Kitap, ((İstanbul: İktisat Fakültesi Yayınlarıİstanbul: İktisat Fakültesi Yayınları), ), 1717.. Kessler Kessler taught the worker leaders how they can protect their rights within the framework of taught the worker leaders how they can protect their rights within the framework of the system.the system. Ibid., 240.Ibid., 240. As Fındıkoğlu suggests, social policy is not only aAs Fındıkoğlu suggests, social policy is not only an academic n academic discipline but also a guiding referee. Fındıkoğlu, “Sosyalizm ve İçtimai Siyaset,” discipline but also a guiding referee. Fındıkoğlu, “Sosyalizm ve İçtimai Siyaset,” İktisat İktisat Fakültesi Sosyal Siyaset Konferansları, 1. KitapFakültesi Sosyal Siyaset Konferansları, 1. Kitap ((İstanbul: İktisat Fakültesi Yayınİstanbul: İktisat Fakültesi Yayınlaları,rı, 19481948), ), 107107.. Toker Dereli also asserts that unionism in Turkey benToker Dereli also asserts that unionism in Turkey benefited from both efited from both Kessler and Tuna and claims Kessler and Tuna and claims his estimation that the his estimation that the Law on Trade Unions (Law on Trade Unions (Sendikalar Sendikalar KanunuKanunu) ) was also influenced by the conferences of Kessler. Özbek, was also influenced by the conferences of Kessler. Özbek, Cumhuriyet, Cumhuriyet, 169.169.

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and

and Sadi Irmak were presented. At the core of the debates were the sit-Sadi Irmak were presented. At the core of the debates were the sit-uation of industrial workers, unionism, the right to strike and employeruation of industrial workers, unionism, the right to strike and employer--employee relations. employee relations. TThese themeshese themes and articlesand articles will be elaborated will be elaborated in the in the following following subsub--sections.sections.

5.3.2 Cahit Talas and “SCahit Talas and “Social Policy” in Turkey after the Second ocial Policy” in Turkey after the Second World WarWorld War

Similar with the structuring of social politics in Istanbul University in

Similar with the structuring of social politics in Istanbul University in the early years of the foundation of the faculty, a parallel development the early years of the foundation of the faculty, a parallel development on social policy took place in Ankara University led by Con social policy took place in Ankara University led by Cahit Talas after ahit Talas after the Wthe World orld WWar ar II. Talas, was a pioneer figure in social policy in Turkey II. Talas, was a pioneer figure in social policy in Turkey who dedicatedly worked on various aspects regarding social policy who dedicatedly worked on various aspects regarding social policy within a comparative framework. His book within a comparative framework. His book İçtimai İktisatİçtimai İktisat (Social Eco-(Social Eco-nomics)nomics) is one of those most comprehensive works on social policy of is one of those most comprehensive works on social policy of that time. He wrote many other books namely, that time. He wrote many other books namely, TTüürkiye’nin Açıklamalı rkiye’nin Açıklamalı Sosyal Politika TarihiSosyal Politika Tarihi (Annotated History of Social Policy in Turkey) (Annotated History of Social Policy in Turkey) and and Toplumsal PolitikaToplumsal Politikaya Girişya Giriş ((Introduction to Social Politics) Introduction to Social Politics) which all re-which all re-finedly encapsulate the task. Throughout Talas’ works, we both see the finedly encapsulate the task. Throughout Talas’ works, we both see the historical background that historical background that lays the groundworklays the groundwork for social policies and for social policies and the instant policy proposals for the current situationthe instant policy proposals for the current situationss. Co. Compared to mpared to Gerhard Kessler, Cahit Talas handles the issue by focusing less on the Gerhard Kessler, Cahit Talas handles the issue by focusing less on the concepts or descriptions and more on the concrete facts of the Cold War concepts or descriptions and more on the concrete facts of the Cold War atmosphere. atmosphere.

As Alpaslan Işıklı suggests, the development and downfall of social

As Alpaslan Işıklı suggests, the development and downfall of social state hastate hadd parallels wiparallels with the lifespan of Cahit Talas. Born in Trabzon in th the lifespan of Cahit Talas. Born in Trabzon in 1917 in a middle1917 in a middle--class family, Talas entered Mülkiye in 1934 and gradu-class family, Talas entered Mülkiye in 1934 and gradu-ated in 1938, the same year Atatürk died. Işıklı implies that the Ata-ated in 1938, the same year Atatürk died. Işıklı implies that the Ata-türkçütürkçü (Kemalist)(Kemalist) excitement of him is based on the acquisitions iexcitement of him is based on the acquisitions in n those years. He then went to Switzerland, Geneva University and his those years. He then went to Switzerland, Geneva University and his PhD thesis on PhD thesis on ““Türkiye’de Çalışma İlişkileri MevzuatıTürkiye’de Çalışma İlişkileri Mevzuatı”” (The Legislation (The Legislation of Labor Relations in Turkey)of Labor Relations in Turkey) was approved and published in French. was approved and published in French.

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When he turned back to Turkey, he entered

When he turned back to Turkey, he entered the the Finance Ministry as a Finance Ministry as a part of compulsory service and then transferred topart of compulsory service and then transferred to thethe newly founded newly founded Ministry of Labor. In 1953, he returned to academic sphere in Mülkiye Ministry of Labor. In 1953, he returned to academic sphere in Mülkiye as an associate professor and taught “içtimai iktisat” at the university. as an associate professor and taught “içtimai iktisat” at the university. This chairThis chair waswas transftransformed into “Social Policy and Business Law” in the ormed into “Social Policy and Business Law” in the 1960s.1960s.91 He took on He took on the the Ministry of Labor during the 27Ministry of Labor during the 27thth May govern-May govern-ments.ments.92 As it can be seen from his personal history, his statesman and As it can be seen from his personal history, his statesman and academic identities are embedded into each other and one can see thacademic identities are embedded into each other and one can see the e traces of this synergy traces of this synergy all all throughout his works.throughout his works.

The first conspicuous theme through his writings is the emphasis on

The first conspicuous theme through his writings is the emphasis on social peace and consensus. Talas social peace and consensus. Talas in almost all in almost all ofof his works his works defines so-defines so-cial policial policycy as an instrument for “social balance and collusion” whas an instrument for “social balance and collusion” which ich aims to achieve social justice and peace by adjusting the natural laws of aims to achieve social justice and peace by adjusting the natural laws of economics and moderation of class conflict. As Sadun Aren also puts, economics and moderation of class conflict. As Sadun Aren also puts, this is a clear refutation of the liberal doctrine.this is a clear refutation of the liberal doctrine.93 Since the most promi-Since the most promi-nent aim was to reduce inequalities,nent aim was to reduce inequalities, the preferred attitude was por-the preferred attitude was por-trayed as the state intervention.trayed as the state intervention.94 Another important emphasis of Talas Another important emphasis of Talas was on the rightwas on the right--based implementations of social policy. For him, at the based implementations of social policy. For him, at the heart of the welfare state lies the acknowledgement of personal dignity heart of the welfare state lies the acknowledgement of personal dignity of the inof the individual. The indispensable and inviolable rights of the individ-dividual. The indispensable and inviolable rights of the individ-ual should be guaranteed by state.ual should be guaranteed by state.95 The conditions of the reforms and The conditions of the reforms and

91 AlpaslanAlpaslan Işıklı, “Sosyal Devlet ve Prof. Dr. Cahit TalasIşıklı, “Sosyal Devlet ve Prof. Dr. Cahit Talas,”,” Çalışma vÇalışma ve Toplume Toplum, , no. 1 (2007): no. 1 (2007): 19. Işıklı connotates Dostoyevski’s quote “Hepimiz Gogol’un paltosundan çıktık” and 19. Işıklı connotates Dostoyevski’s quote “Hepimiz Gogol’un paltosundan çıktık” and claims that many academics and policy makers in social policy is “stemmed from Cahit claims that many academics and policy makers in social policy is “stemmed from Cahit Talas’ Talas’ İçtimai İktisatİçtimai İktisat””. Ibid.,. Ibid., 2020..

92 Özbek, Özbek, Cumhuriyet, Cumhuriyet, 181181..

93 Sadun Aren, review of Sadun Aren, review of İçtimai İktisat Dersleri İçtimai İktisat Dersleri by Cahit Talasby Cahit Talas (Ankara: AÜSBF Yayını, (Ankara: AÜSBF Yayını, 1955)1955), 154, 154--155. For Aren, remaining outside of the doctrinal debates is the 155. For Aren, remaining outside of the doctrinal debates is the strongeststrongest part of part of Talas’ book.Talas’ book.

94 CahitCahit Talas, Talas, Türkiye’nin Açıklamalı Sosyal Politika TarTürkiye’nin Açıklamalı Sosyal Politika Tarihiihi, 6, 600.. For Talas, today’s problem For Talas, today’s problem is not the amount of products is not the amount of products --as was suggested by Malthus beforeas was suggested by Malthus before-- but the imbalanc-but the imbalanc-es, injustices and inequalities in distribution. The act of state is to guarantee the rights es, injustices and inequalities in distribution. The act of state is to guarantee the rights and freedoms by prevailing social rights.and freedoms by prevailing social rights.

95 TalasTalas,, “Başbakan İsmet İnönü ve Sosyal Politika“Başbakan İsmet İnönü ve Sosyal Politika,,”” AÜSBFAÜSBFDD 20, no. 1 (1965):20, no. 1 (1965): 345345..

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welfare are presented as freedom, equal opportunity, human dignity

welfare are presented as freedom, equal opportunity, human dignity and fair wages: Living humanly under constitutional ordand fair wages: Living humanly under constitutional order.er.

One might have expected to see more leftist tendencies among the

One might have expected to see more leftist tendencies among the agents agents who played the leading roles in the establishment of who played the leading roles in the establishment of social poli-social poli-cycy; however,; however, arguments suggesting cleararguments suggesting clear--cut deviations from the capi-cut deviations from the capi-talist system or a challenging ideological discotalist system or a challenging ideological discourse were not really con-urse were not really con-fronted through thefronted through the archivalarchival material. For instance, Talas locates social material. For instance, Talas locates social policy under the frame of the capitalist welfare state, outside the Marx-policy under the frame of the capitalist welfare state, outside the Marx-ist economics.ist economics.96 He also asserts that economic development plans aren’t He also asserts that economic development plans aren’t under the monopunder the monopoly of any economic system. The social security sys-oly of any economic system. The social security sys-tems in Western world aretems in Western world are considered to beconsidered to be far more beyond the radical far more beyond the radical socialist and communist states socialist and communist states byby him. He criticizes radical leftistshim. He criticizes radical leftists as as well.well. HHe states that instead of relying on e states that instead of relying on ““ismsisms”” and provokiand provoking ways for ng ways for old fashioned class conflict, organizing for a fair distribution of oppor-old fashioned class conflict, organizing for a fair distribution of oppor-tunities is tunities is much much more suitable for the needs and beliefs of the Turkish more suitable for the needs and beliefs of the Turkish society. It is also important to mention that Talas considers the socialist society. It is also important to mention that Talas considers the socialist movement in Turkey as amovement in Turkey as a wouldwould--bebe and not in demand by the workers and not in demand by the workers indeed. Imitation of the ways of ideal societies was construed as a dan-indeed. Imitation of the ways of ideal societies was construed as a dan-gerous eagerness. Instead of dogmatism, pragmatic rules of mixed gerous eagerness. Instead of dogmatism, pragmatic rules of mixed economy are to be preferred for him.economy are to be preferred for him.97

Through his writings, Talas sincerely r

Through his writings, Talas sincerely remunerates the policy emunerates the policy measures in the early measures in the early RRepublican era.epublican era.98 Social policy for him, made pro-Social policy for him, made pro-gress in a short span of time in Turkey even before experiencing agress in a short span of time in Turkey even before experiencing a mate-mate-rialrial industrial revolution.industrial revolution.99 For instance, the speech of Atatürk in the For instance, the speech of Atatürk in the İzmir Economic Congress 1923 was interpreted as a discourse that İzmir Economic Congress 1923 was interpreted as a discourse that serves for social policy. The speech of İnönü in the 4serves for social policy. The speech of İnönü in the 4thth LLabor Assembly-abor Assembly-wawas considered to present the principles of social policy in the best way. s considered to present the principles of social policy in the best way. TThe main concern of these two speeches he main concern of these two speeches wawas thes the emphasis on classless-emphasis on classless-ness and Talas seems to agree on this perceptionness and Talas seems to agree on this perception as wellas well. One can feel . One can feel

96 TalasTalas,, “Plan, “Plan, KalkınmaKalkınma ve İktisadi Sistemlerve İktisadi Sistemler,,” ” AÜSBFAÜSBFDD 17, no. 3 (1962):17, no. 3 (1962): 44--77..

97 Talas, “Başbakan İsmetTalas, “Başbakan İsmet,,” 342” 342--347347..

98 IbidIbid., ., 347347--348348..

99 Talas, Talas, Türkiye’ninTürkiye’nin AçıklamalıAçıklamalı,, 6363..

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Talas’ endeavors in foregrounding the practices in the early

Talas’ endeavors in foregrounding the practices in the early RRepublican epublican years, probably with the loyalty to the years, probably with the loyalty to the achievachieveementments by the revolution. s by the revolution. In addition, Talas seems to challenge the assumptions that left Turkey In addition, Talas seems to challenge the assumptions that left Turkey behind the west, at least for sbehind the west, at least for severaleveral occasions. For instance, he claims occasions. For instance, he claims that the 1924 Constitution is not really different from other Wthat the 1924 Constitution is not really different from other World orld WWar ar I I constitutionconstitutions (except Weimar).s (except Weimar).100 This is also understandable when we This is also understandable when we think of the rapid cultural modernization ideal and efforts to catch up think of the rapid cultural modernization ideal and efforts to catch up with the west.with the west.

Although acknowledging the practices in the early

Although acknowledging the practices in the early RRepublican peri-epublican peri-od during when a substantial working class has nod during when a substantial working class has not yet appeared, the ot yet appeared, the structural prerequisites for social policy were put forth by Talas as in-structural prerequisites for social policy were put forth by Talas as in-dustrialization, existence of a working class, democracy, intellectual at-dustrialization, existence of a working class, democracy, intellectual at-mosphere and international labor movements.mosphere and international labor movements.101 In attainment of these In attainment of these prerequisites, the Wprerequisites, the Wororld ld WWar ar II was considered as a breaking point II was considered as a breaking point since the significance of labor in production of the necessary materials since the significance of labor in production of the necessary materials was clearly understood and even the less developed countries began to was clearly understood and even the less developed countries began to pay attention to protection of labor from then on.pay attention to protection of labor from then on.102 In case of a hesIn case of a hesita-ita-tion about whether the social policies can be implemented as they are in tion about whether the social policies can be implemented as they are in the less developed countriesthe less developed countries;; Talas, with reference to Gunnar Myrdal, Talas, with reference to Gunnar Myrdal, claims that even if a democratic regime doesn’t have a classical sub-claims that even if a democratic regime doesn’t have a classical sub-stance as in the West, it can be specifiedstance as in the West, it can be specified according to the conditions of according to the conditions of

100 Ibid.,Ibid., 6565..

101 Cahit Cahit Talas, “Türkiye’de Sosyal Sigortaların Gelişme TemayülleriTalas, “Türkiye’de Sosyal Sigortaların Gelişme Temayülleri,,” ” AÜSBFAÜSBFDD 12, no. 212, no. 2 ((19571957):): 33--44,, cited cited inin Paul Mantoux, Paul Mantoux, La Revolucion Industrielle au XVIII e siecle, essai sur La Revolucion Industrielle au XVIII e siecle, essai sur les commencement de la grande industrie moderne en Angiltles commencement de la grande industrie moderne en Angilterre,erre, ((Paris, 1906Paris, 1906). Talas ). Talas argues thatargues that by the adoption of democratic rules, Britain is accepted as the motherland by the adoption of democratic rules, Britain is accepted as the motherland of social policy. Although the main reason is the birth of industrial revolution in Britain of social policy. Although the main reason is the birth of industrial revolution in Britain ––and the harsh and inhumane working conditions theand the harsh and inhumane working conditions the working class experiencedworking class experienced-- it it must be emphasized that Britain also accepted the parliamentary system in the corre-must be emphasized that Britain also accepted the parliamentary system in the corre-sponding period of time. In France, social policy was developed with the proclamation sponding period of time. In France, social policy was developed with the proclamation of the third of the third RRepublic. In Bismarckepublic. In Bismarckianian Germany, in which Germany, in which the modern social insurance the modern social insurance was developed, social policy was developed, social policy waswas regarded as a mean of regarded as a mean of a a campaign against the social-campaign against the social-ist parties, to pull the votes of the working class. As the examples in each country ist parties, to pull the votes of the working class. As the examples in each country show, the social policy went hand in hand with the developmshow, the social policy went hand in hand with the development of democracy.ent of democracy.

102 Cahit Cahit Talas, “Harp Sonu Anayasalarında Sosyal HaklarTalas, “Harp Sonu Anayasalarında Sosyal Haklar,,” ” AÜSBFAÜSBFDD 11, no. 3 (11, no. 3 (19561956):): 247247..

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the country without making a lot of sacrifice from the essence. When we

the country without making a lot of sacrifice from the essence. When we think that the books of Talas were published primarily for the audience think that the books of Talas were published primarily for the audience in this country, all his workin this country, all his workss might be evaluated as fruitful meanmight be evaluated as fruitful meanss to the to the follofollowing end: adoption of the appropriate policies for the peculiar con-wing end: adoption of the appropriate policies for the peculiar con-ditions of Turkey without sacrificing much from the essence of social ditions of Turkey without sacrificing much from the essence of social policy implementations in the West.policy implementations in the West.

5.3.3 Prominent Themes Related with Social Policy Since the Sec-Prominent Themes Related with Social Policy Since the Sec-ond World Warond World War

5.3.3.1 Wage IWage Issuessue

The role and specification of wage ha

The role and specification of wage haveve been matterbeen matterss of debate for a of debate for a long time. Its impact on the living conditions of the workers has a pri-long time. Its impact on the living conditions of the workers has a pri-mary importance. For that reason, the economic character of wage mary importance. For that reason, the economic character of wage needs elaboration. Wage first must provide a needs elaboration. Wage first must provide a living for the worker. Then living for the worker. Then the question is, what is this “living”? Which elements constitute the no-the question is, what is this “living”? Which elements constitute the no-tion of living? It is obviously not just composed of procurement of sub-tion of living? It is obviously not just composed of procurement of sub-sistence. Referring to Mazeaud, Talas claims that living requires an ade-sistence. Referring to Mazeaud, Talas claims that living requires an ade-quate wage raquate wage rate that would make the worker feel confident about te that would make the worker feel confident about hishis/her/her future, safeguarding the material, moral and intellectual needs future, safeguarding the material, moral and intellectual needs of himof him/her/her..103

As is propounded by the academics, the important thing is not the

As is propounded by the academics, the important thing is not the income a worker gets in return for the labor power, buincome a worker gets in return for the labor power, but the purchasing t the purchasing power of that incomepower of that income104 which is the real wage.which is the real wage.105 Talas argues against Talas argues against

103 Talas, “Yeter Bir Ücret Politikasının Zarureti ve Ücretin HimayesiTalas, “Yeter Bir Ücret Politikasının Zarureti ve Ücretin Himayesi,,”” AÜSBFAÜSBFDD 4, no. 1 4, no. 1 ((19481948):): 244, cited 244, cited in in H. Mazeaud: H. Mazeaud: Principes de Principes de RReforme eforme SSocialeociale, Paris , Paris ((19451945:: 9797).).

104 ReşReşatat Nalbandoğlu,Nalbandoğlu, “Ücretler ve Fiyatlar“Ücretler ve Fiyatlar,,”” İÜSSKD, İÜSSKD, no. 3 (1950):no. 3 (1950): 6666..

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considering labor as a commodity as it is/was considered by most of the

considering labor as a commodity as it is/was considered by most of the liberals. For him, wage can be defined as the remuneration of the pro-liberals. For him, wage can be defined as the remuneration of the pro-ductive activity of the workerductive activity of the worker. The critical point here is revealed as the . The critical point here is revealed as the fact that the determination of wage is not an economic phenomenon as fact that the determination of wage is not an economic phenomenon as it was before, but a social one.it was before, but a social one.106

As wage occurs as a social fact that has strong relations with the

As wage occurs as a social fact that has strong relations with the character and human rights of the worker;character and human rights of the worker; state’s state’s --namely the welfare namely the welfare state’sstate’s-- function in the current world becomes intervening into the function in the current world becomes intervening into the wage policies for the sake of the provision of fair standards of living.wage policies for the sake of the provision of fair standards of living.107 State for Talas, should act as it is the only representative of the general State for Talas, should act as it is the only representative of the general

105 Cahit Cahit Talas, “Ücret PolitikalarıTalas, “Ücret Politikaları,,” ” AÜSBFAÜSBFDD 2020, , no. 2no. 2 (1965): 20. Charles(1965): 20. Charles Gide, who is Gide, who is considered as a great economist of that times by Talas, defineconsidered as a great economist of that times by Talas, definedd wage as the “price of wage as the “price of the labor that ithe labor that is utilized or rented for an enterprises utilized or rented for an enterprise..” cited ” cited inin Charles Gide, Charles Gide, Principes Principes d’Economie Politiqued’Economie Politique, 26. , 26. ed. (ed. (Paris, 1936Paris, 1936), ), 511511.. Sabahattin Zaim’s definition is men-Sabahattin Zaim’s definition is men-tioned as follows: “tioned as follows: “WWage is an income paid before the product is sold; it is the remu-age is an income paid before the product is sold; it is the remu-neration of neration of the labor used in production, which is independent from the profit or loss the labor used in production, which is independent from the profit or loss of the enterprise indeed.of the enterprise indeed.” Talas, ” Talas, 2121, , cited cited inin Sabahattin Zaim, Sabahattin Zaim, Günümüzün Sosyal Siyaset Günümüzün Sosyal Siyaset MeseleleriMeseleleri ((İstanbul, 1962İstanbul, 1962),), 96.96.

106 Talas, “Yeter Bir ÜcretTalas, “Yeter Bir Ücret,,” 242” 242--246246.. TThis concept goes back to middle ages and some his concept goes back to middle ages and some people allege that this idea is already existent in Eflatun’s works. Talaspeople allege that this idea is already existent in Eflatun’s works. Talas presents the presents the history andhistory and refers to Papa XIII. Leon refers to Papa XIII. Leon who claimed it is a shamwho claimed it is a shamee regarding peo-regarding peo-ple/human as a mean of profit and respect him ple/human as a mean of profit and respect him in the ratio ofin the ratio of hishis laborlabor powerpower first.first. By By this example,Talas argues that the necessity of anthis example,Talas argues that the necessity of an adequate wage for the adequate wage for the workerworker is not is not an invention of the current eraan invention of the current era indeedindeed.. Although the vitalism of aAlthough the vitalism of adequate wage is root-dequate wage is root-ed in earlier periods, it was interrupted by the attacks ofed in earlier periods, it was interrupted by the attacks of thethe liberal theories in the liberal theories in the 1919thth century. century. Talas claims that tTalas claims that the he ““industrial revolution revived to speak the inhuman anindustrial revolution revived to speak the inhuman andd antiquated implementations of slavery. Necker’s, Owen’s,antiquated implementations of slavery. Necker’s, Owen’s, Legrand’s, Blanqui’s, Sis-Legrand’s, Blanqui’s, Sis-mondi’s clamors declaring that this is a danger for society, withered away in the midst mondi’s clamors declaring that this is a danger for society, withered away in the midst of machine voiceof machine voicess.. The only important thing for the bosses of the 19The only important thing for the bosses of the 19thth century liberal-century liberal-ism was the increase in production at all costs and all ism was the increase in production at all costs and all the implementations of that era the implementations of that era should be considered as noteworthy for us today. In other words, during the classicals’ should be considered as noteworthy for us today. In other words, during the classicals’ heyday, labor was considered as a commodity and economists since the physiocrats heyday, labor was considered as a commodity and economists since the physiocrats were confined themselves to research just on labor in dwere confined themselves to research just on labor in determining the wage ratesetermining the wage rates””. . For aFor a similar analysissimilar analysis, see , see Orhan Tuna, “Memleketimizde Sendikaların Üzerinde Dur-Orhan Tuna, “Memleketimizde Sendikaların Üzerinde Dur-dukları Meselelerdukları Meseleler,,”” İÜSSKD, İÜSSKD, no. 8no. 8 (1956):(1956): 106106..

107 Talas, “Ücret PolitikalarıTalas, “Ücret Politikaları,,”” 2121.. Here one should keep in mind that this article was Here one should keep in mind that this article was published inpublished in 19651965,, during the heyday of the welfare state.during the heyday of the welfare state.

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interest

interest on an equitable basis, in a world of conflicting parties’ strug-on an equitable basis, in a world of conflicting parties’ strug-gling for their own interests.gling for their own interests.108 Besides, regardless of the economic sys-Besides, regardless of the economic sys-tem, state is expected to intervene in wages to sustain the economy and tem, state is expected to intervene in wages to sustain the economy and prevent the appearance of inflation during the timprevent the appearance of inflation during the times of full employment, es of full employment, to maintain the stability and provide the existence of a real justice in-to maintain the stability and provide the existence of a real justice in-stead of the ostensible one.stead of the ostensible one.109 This is regarded as a prior task for the This is regarded as a prior task for the developing countries developing countries experiencing theexperiencing the income inequality problem. In income inequality problem. In addition, the roles ofaddition, the roles of the fiscal and agricultural reforms, social security the fiscal and agricultural reforms, social security and social service systems in regulating income distribution are also and social service systems in regulating income distribution are also emphasized. Talas in advocating the need for fair wages for the sake of emphasized. Talas in advocating the need for fair wages for the sake of the the whole society highlights that a permanent increase in rewhole society highlights that a permanent increase in real wages is al wages is subject to subject to anan increase in the total production volume and that total pro-increase in the total production volume and that total pro-duction would increase by the existence of a fair wage which serves for duction would increase by the existence of a fair wage which serves for the general interest of the society by raising competitiveness of that the general interest of the society by raising competitiveness of that country in foreign markets.country in foreign markets.110 For Talas, the wage rate is also closely For Talas, the wage rate is also closely related with the supply of the material goods, hence the developing related with the supply of the material goods, hence the developing countries hacountries haveve to pay attention to this aspect of development.to pay attention to this aspect of development.111

Theories on wages were question

Theories on wages were questionss of debate since time immemorial. of debate since time immemorial. HoweverHowever;; for Talafor Talas, neither the liberal ecole’s natural wages, neither the liberal ecole’s natural wage112, nor Stu-, nor Stu-art Mill’s wage fund theoryart Mill’s wage fund theory113 or Marx’s surplus value theory was able or Marx’s surplus value theory was able

108 Talas, “YeterTalas, “Yeter,,” 246” 246..

109 Talas, “ÜcretTalas, “Ücret,,” 18” 18..

110 IbidIbid.,., 3636..

111 IbidIbid., ., 3737..

112 Ibid., Ibid., 2424--2525.. In the classical theory which can also be called as “subsistence wage In the classical theory which can also be called as “subsistence wage theorytheory”,”, the measure that determines the wagethe measure that determines the wage rate rate is is the physiological needs of the the physiological needs of the worker. This theory was propounded by Cantillon, Turgot, Adam Smithworker. This theory was propounded by Cantillon, Turgot, Adam Smith, , developed by developed by David Ricardo and called as “natural wage theory”. This theory had fit in with the con-David Ricardo and called as “natural wage theory”. This theory had fit in with the con-ditions of Ricardo’s eraditions of Ricardo’s era,, but it has lost its vabut it has lost its value inlue in thethe developed countries today alt-developed countries today alt-hough it is still in use among hough it is still in use among some some underdeveloped regions. However, Talas claims underdeveloped regions. However, Talas claims that Ricardo’s theory is not applicable for that Ricardo’s theory is not applicable for the the lessless--developed or developing countries. developed or developing countries.

113 Talas, Talas, “Ücret,”“Ücret,” 2525.. The “wage fund theory”The “wage fund theory” is also a doctrine of the classical theoreti-is also a doctrine of the classical theoreti-cians whereas it doesn’t approach the task from the supply side, but from the demand cians whereas it doesn’t approach the task from the supply side, but from the demand side. Represented in John Stuart Mill’s ideas, this theory suggests that there is a certain side. Represented in John Stuart Mill’s ideas, this theory suggests that there is a certain amount of fund predetermined for tamount of fund predetermined for the demand of labor and the total wage cannot he demand of labor and the total wage cannot

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to end the existent divergences in real life.

to end the existent divergences in real life.114 For him, the current condi-For him, the current condi-tions of the countries are to play the decisive role. In othetions of the countries are to play the decisive role. In other words, there r words, there might be numerous wage policies depending on the economic and social might be numerous wage policies depending on the economic and social peculiarities of the countries, among which there are the level of devel-peculiarities of the countries, among which there are the level of devel-opment of the unionist movement, the nature of the economic systems opment of the unionist movement, the nature of the economic systems and the general development leveand the general development level of each country.l of each country.115 Talas discrimi-Talas discrimi-nates between the different purposes of the wage policies in developing nates between the different purposes of the wage policies in developing and developed countries due to the preand developed countries due to the pre--given peculiarities of each as given peculiarities of each as follows: In developing countries, they occur for prohibiting exploitation follows: In developing countries, they occur for prohibiting exploitation and grand granting a wage rate for those who earn their living by selling their anting a wage rate for those who earn their living by selling their labor power. On the other hand, in developed countries that have al-labor power. On the other hand, in developed countries that have al-ready maintained full employment, they are mainly scrutinized for the ready maintained full employment, they are mainly scrutinized for the provision of general economic balance and preventioprovision of general economic balance and prevention the inflationary n the inflationary pressures.pressures.116

exceed the limits of that fund. Talas criticizes this theory

exceed the limits of that fund. Talas criticizes this theory by arguingby arguing that it is errone-that it is errone-ous to suppose that there is a fixed amount of money for the wage payments and the ous to suppose that there is a fixed amount of money for the wage payments and the labor pool is inelastic. Here in this tlabor pool is inelastic. Here in this theory, population is regarded as a passive element. heory, population is regarded as a passive element. Therefore, it has a static viewpoint in this sense.Therefore, it has a static viewpoint in this sense.

114 Talas, Talas, “Yeter,” “Yeter,” 244244.. cited cited inin JeanJean--Louis Gugliemi: Louis Gugliemi: Essai sur la developpement de la Essai sur la developpement de la theorie du salairetheorie du salaire ((Paris, 1945Paris, 1945).). An alternative one namely “the An alternative one namely “the marginal productivity marginal productivity theory” is based on the existence of perfect competition. But Talas says that it is not theory” is based on the existence of perfect competition. But Talas says that it is not always possible to meet the perfect competition and it is difficult to measure the mar-always possible to meet the perfect competition and it is difficult to measure the mar-ginal productivity of each labor. There is also a theory calginal productivity of each labor. There is also a theory called “bargain theory” which led “bargain theory” which designates a minimum and maximum rate for wage and the result would be based on designates a minimum and maximum rate for wage and the result would be based on the bargaining power of the two parties. But this is also exposed to the impacts of the bargaining power of the two parties. But this is also exposed to the impacts of supply and demand of labor. And the last theory Talas examines issupply and demand of labor. And the last theory Talas examines is the “purchasing the “purchasing power theory” which in fact refers to power theory” which in fact refers to presence of presence of high wages. The motivation behind high wages. The motivation behind this theory, which is interestingly propounded by the employers, is to increase the this theory, which is interestingly propounded by the employers, is to increase the total demand for the consumption goods. But Talas recalls the fact thattotal demand for the consumption goods. But Talas recalls the fact that the high pro-the high pro-duction costs may result in difficulties in exports.duction costs may result in difficulties in exports. Talas, Talas, “Ücret,” “Ücret,” 2244--2727..

115 Talas, “Ücret,”Talas, “Ücret,” 2727..

116 IbidIbid., ., 18. Talas, 18. Talas, ““ÜcretÜcret,” ,” 3333--3535.. Wage policies in some developed countries are Wage policies in some developed countries are portrayed with a comparative perspective by Talas. He starts portrayed with a comparative perspective by Talas. He starts with Holland, by saying with Holland, by saying that there is a “Commission of Conciliation”, an autonomous institute which plays an that there is a “Commission of Conciliation”, an autonomous institute which plays an objective mediatory role between the government and the workers. Besides, there is objective mediatory role between the government and the workers. Besides, there is “Economic and Social Council” which is comprised “Economic and Social Council” which is comprised ofof independent independent experts and repre-experts and repre-

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Apart from fair wage, what also serves for the general interest of the

Apart from fair wage, what also serves for the general interest of the society is portrayed as the productivity increase, an excessively empha-society is portrayed as the productivity increase, an excessively empha-sized theme both in the developed and developing world.sized theme both in the developed and developing world.117 The psy-The psy-chological aspect ichological aspect in this issue is considered as vitally important as the n this issue is considered as vitally important as the economic one, and it is economic one, and it is regarderegarded even more critical in less developed d even more critical in less developed countries as they suffer from the lack of capital which must be compen-countries as they suffer from the lack of capital which must be compen-sated by an increase in the productivity of labor. For that rsated by an increase in the productivity of labor. For that reason, it is eason, it is important to make every individual who plays a part of the production important to make every individual who plays a part of the production process truly believe in the vitalism of production increase, speedprocess truly believe in the vitalism of production increase, speed--up up and place reliance on the fact that they will also have the means to bene-and place reliance on the fact that they will also have the means to bene-fit from this increase.fit from this increase.118 One One should also keep in mind that the satisfac-should also keep in mind that the satisfac-tion of material needs is not enough. It is argued that the creation of an tion of material needs is not enough. It is argued that the creation of an atmosphere in which the worker could feel the value of his contribution atmosphere in which the worker could feel the value of his contribution and uniqueness of his role in the production process is also signifand uniqueness of his role in the production process is also significant. icant.

sentatives of workers and employers. In Scandinavian countries the wage policy is

sentatives of workers and employers. In Scandinavian countries the wage policy is identified via negotiation system, the parts of the negotiation are the highest degree identified via negotiation system, the parts of the negotiation are the highest degree entities that represent employers and employees. This refers to the exentities that represent employers and employees. This refers to the existence of high istence of high degree organizing power. Even the unions have to obey the rules established by this degree organizing power. Even the unions have to obey the rules established by this organizingorganizing body.body. In France, a national wage structure was adopted in the aftermath of In France, a national wage structure was adopted in the aftermath of the World War Ithe World War I,, but it didn’t work well. In addition, the unionism wabut it didn’t work well. In addition, the unionism was very dispersed s very dispersed and just the 15and just the 15--20 percent of the workers were union members. The country was di-20 percent of the workers were union members. The country was di-vided into five zones and the minimum wage levels were determined in accordance vided into five zones and the minimum wage levels were determined in accordance with the economic development of the country. In planned economies like Russia,with the economic development of the country. In planned economies like Russia, wages are determined by central institutions and plan makers. Wage policy primarily wages are determined by central institutions and plan makers. Wage policy primarily aims to encourage production and provide a fruitful distribution of labor power. aims to encourage production and provide a fruitful distribution of labor power. Therefore, certain branches of industries are prioritized. Each and every enterprise is Therefore, certain branches of industries are prioritized. Each and every enterprise is gigiven a labor power plan and this plan designates the wage. Besides, workers can be ven a labor power plan and this plan designates the wage. Besides, workers can be categorized based on their productivity level and wages may differ in accordance with categorized based on their productivity level and wages may differ in accordance with that. Nevertheless, this must be within the boundaries of the wage fund.that. Nevertheless, this must be within the boundaries of the wage fund.

117 Talas first Talas first puts the difference between production and productivity by stating that puts the difference between production and productivity by stating that production refers to an aggregateproduction refers to an aggregate;; on the other handon the other hand, , productivity is a result acquired productivity is a result acquired from one unit. And in order to increase the productivity, what is to be done is not to from one unit. And in order to increase the productivity, what is to be done is not to work morework more, but, but toto work intensively and regularly.work intensively and regularly. Cahit Cahit Talas, “Verimliliğin Artırıl-Talas, “Verimliliğin Artırıl-masında Psikolojik Faktörlerin Rolümasında Psikolojik Faktörlerin Rolü,,”” AÜSBFAÜSBFDD 7, no. 1 (1952): 46.7, no. 1 (1952): 46.

118 Cahit Cahit Talas, “Verimliliğin Artırılmasında Psikolojik Faktörlerin RolüTalas, “Verimliliğin Artırılmasında Psikolojik Faktörlerin Rolü,,”” AÜSBFAÜSBFDD 7, no. 1 7, no. 1 (1952):(1952): 4545..

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An enterprise should be considered as a social organism as much as an

An enterprise should be considered as a social organism as much as an economic entity then. Talas criticizeeconomic entity then. Talas criticizedd the situation in the current world the situation in the current world by saying that the big fabrics lead to alienation and the routine brings by saying that the big fabrics lead to alienation and the routine brings about false presumptions about tabout false presumptions about the employers and employees. The so-he employers and employees. The so-lution offered by him is making the worker aware of the aims and trajec-lution offered by him is making the worker aware of the aims and trajec-tory of the enterprise, feel sure on the fact that he is treated humanely, tory of the enterprise, feel sure on the fact that he is treated humanely, have trust to his chef and feel free to make commentaries on the work have trust to his chef and feel free to make commentaries on the work he doehe does.s.119 As it is insistently and frequently emphasized by Talas, the As it is insistently and frequently emphasized by Talas, the point is to believe in the compliance of interests instead of a struggle.point is to believe in the compliance of interests instead of a struggle.120

A potential handicap in front of productivity increase

A potential handicap in front of productivity increase iis identified s identified as as the fear of unemployment among the workersthe fear of unemployment among the workers bby Talasy Talas. He acknowledg-. He acknowledg-es the fact that a relative unemployment might occur by the increase in es the fact that a relative unemployment might occur by the increase in productivity, but also claims that this can be prevented via the precau-productivity, but also claims that this can be prevented via the precau-tions of the government, union and employer coordination. Policy pref-tions of the government, union and employer coordination. Policy pref-erences on determinatierences on determination of wages, prices and profit rates play a critical on of wages, prices and profit rates play a critical role in such a case.role in such a case.121 A productivity increase for him should not only A productivity increase for him should not only mean an increase in the profit rates but also in the wage rates.mean an increase in the profit rates but also in the wage rates.122 Ac-Ac-cordingly, it is expected to provide cheapening of pricescordingly, it is expected to provide cheapening of prices,, which which would would bring about a demand growth with a need for additional employment bring about a demand growth with a need for additional employment opportunities in production of those consumption goods. In addition, it opportunities in production of those consumption goods. In addition, it is highlighted that the worker would have more facilities to dispel tired-is highlighted that the worker would have more facilities to dispel tired-ness from work in case of a productivitness from work in case of a productivity increase which would possibly y increase which would possibly make them work ardently then.make them work ardently then.123 In another respect, high productivity In another respect, high productivity is also desired for its contribution to the increaseis also desired for its contribution to the increase ofof the profits of the the profits of the

119 Talas, “VerimliliğinTalas, “Verimliliğin,,” 50” 50..

120 This view is shared by manThis view is shared by many authors, Reşad Nalbandoğlu in his article claims that y authors, Reşad Nalbandoğlu in his article claims that capital increase leads to productivity increase on the one hand, and increased welfare capital increase leads to productivity increase on the one hand, and increased welfare of the labor is compatible with the interests of the entrepreneur.of the labor is compatible with the interests of the entrepreneur. NalbandoğluNalbandoğlu, “, “Türk Türk İşçisinin İktisadi İstikbalİşçisinin İktisadi İstikbalii,,”” İÜSSKD, İÜSSKD, no. 2 (no. 2 (19491949): ): 130130.. However, it is observed that However, it is observed that especially in the less developed countries, these preconditions could not have been especially in the less developed countries, these preconditions could not have been internalized deservedly.internalized deservedly.

121 Talas, “VerimliliğinTalas, “Verimliliğin,,”” 4646..

122 IbidIbid., ., 4848-- 4949..

123 H. Arndt, “Asgari ÜcretlerH. Arndt, “Asgari Ücretler,,” ” İÜSSKD,İÜSSKD, no.no. 77 (1955):(1955): 3838--39.39.

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entrepreneurs

entrepreneurs,, which might be oriented to new investments. In the which might be oriented to new investments. In the event of the fevent of the full employment policies of the state are added to all these, ull employment policies of the state are added to all these, the unemployment risk would perishthe unemployment risk would perish for Talasfor Talas..124 The prescriptions of The prescriptions of Talas on alleviation of unemployment by featuring the state policies, the Talas on alleviation of unemployment by featuring the state policies, the demand growth and the role of investment in creation demand growth and the role of investment in creation of job opportuni-of job opportuni-ties all remind us the Keynesian precepts, though his name is not explic-ties all remind us the Keynesian precepts, though his name is not explic-itly mentioned.itly mentioned.

For the wage policies in Turkey, Talas first states the problems and

For the wage policies in Turkey, Talas first states the problems and the deficiencies of the Labor Law especially in determination of the min-the deficiencies of the Labor Law especially in determination of the min-imum wage, imum wage, since there is a statement that it is stipulated to economic since there is a statement that it is stipulated to economic and social obligations.and social obligations.125 Speaking of the vitality of a wage policy in Speaking of the vitality of a wage policy in Turkey, he claims that an economic regime which doesn’t appreciate Turkey, he claims that an economic regime which doesn’t appreciate ththisis issue deservedly, is sentenced to the danger of beingissue deservedly, is sentenced to the danger of being wiped away wiped away from the economic competition. Although it is highly important for a from the economic competition. Although it is highly important for a state to provide livable conditionsstate to provide livable conditions for the workerfor the worker by a fair wage, Talas’ by a fair wage, Talas’ statistical work on the fluctuation of wages shows that the wage rates statistical work on the fluctuation of wages shows that the wage rates for workersfor workers –– including the inincluding the intellectual workerstellectual workers –– wawas far away from s far away from obtaining a life satisfaction level.obtaining a life satisfaction level.126

Consequently, it can be said that keeping in mind the differences in

Consequently, it can be said that keeping in mind the differences in developed and developing countries, a wage policy in accordance with developed and developing countries, a wage policy in accordance with the peculiarities of the local the peculiarities of the local wawas desires desired. d. StateState wawas considered respon-s considered respon-

124 Talas, Talas, “Verimliliğin,” “Verimliliğin,” 4949.. Alfred Isaac claims that only provided that science, social Alfred Isaac claims that only provided that science, social politics and logic goes hand in hand, there would occur peace in the world and strug-politics and logic goes hand in hand, there would occur peace in the world and strug-gle against unemployment. gle against unemployment. Alfred Alfred Isaac,Isaac, “İşsizlik ve İşsizli“İşsizlik ve İşsizlikle Mücadelekle Mücadele,,”” İÜSSKD İÜSSKD 0, no. 0, no. 3 (1950):3 (1950): 3535..

125 Talas, “Yeter BirTalas, “Yeter Bir,,” 253” 253.. Talas here annotates that it is not an easy task to identify these Talas here annotates that it is not an easy task to identify these obligations and it may be open to arbitrariness. He also states that the Labor Law is obligations and it may be open to arbitrariness. He also states that the Labor Law is tacit about the payday which is tacit about the payday which is in fact a very important fact. According to Talas, reex-in fact a very important fact. According to Talas, reex-amination oamination onn many articles many articles regardingregarding the living conditions of the workers is the living conditions of the workers is essential.essential.

126 IbidIbid., ., 254254.. Talas snipes the state policies by stating that it should not be that hard to Talas snipes the state policies by stating that it should not be that hard to adapt the wages to tadapt the wages to the cost of living. For him, it was not that impossible to balance the he cost of living. For him, it was not that impossible to balance the conditions of the economy with the labor market, which suffered from the inadequacy conditions of the economy with the labor market, which suffered from the inadequacy of labor supply during the war. Besides, the profits of the enterprises could be limited of labor supply during the war. Besides, the profits of the enterprises could be limited as as they werethey were in Britain and The United Statesin Britain and The United States..

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sible for supplying a fair wage rate and in addition to the material

sible for supplying a fair wage rate and in addition to the material needs, moral factors that make the worker feel himself as a part of the needs, moral factors that make the worker feel himself as a part of the work work wewere highlighted.re highlighted.

5.3.3.2 The Social Insurance PolicyThe Social Insurance Policy

In the aftermath of the industrial revolution, the financial and emotional misery of the newborn working class required some additional precau-tions. As it was frequently mentioned in the previous sections, the 19th century liberals were against state intervention into economy but the problems of the masses could not be easily solved under the mercy of the free market system. In addition, the 19th century was not only the century of economic liberalism, but also a political one during which the parliamentary systems gained power and the right to say started to comprehend the lower-middle class. Their votes gained importance, their needs and demands gradually became a subject matter of the gov-ernments. The working class became more and more aware of its rights and class consciousness was arisen. The idea of social insurance and social security has come to agenda in such an atmosphere.

On that account, it is understandable that social insurance doesn’t emerge as a necessity in countries where primitive and agricultural economy is prevailed. Since there is no mass working class, no individ-ual economic independence; the workers neither have a class con-sciousness nor a perception of common fate that might have been oc-curred by experiencing similar working and living conditions. As it is hard to identify the situations of the workers in a dispersed agricultural sector, social insurance cannot emerge and develop in such societies for Talas.127 On the other hand, Orhan Tuna mentions that social security is

127 Talas, “Türkiye’de Sosyal Sigortaların Gelişme TemayülleriTalas, “Türkiye’de Sosyal Sigortaların Gelişme Temayülleri,,”” 11--22.. Talas draws attention Talas draws attention to the fact that generally, they are small landowners, and the landless ones are not in to the fact that generally, they are small landowners, and the landless ones are not in contact with each other.contact with each other.

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not only of concern of workers, it should also be recognized as a body of institutions in unity and harmony that aims to guarantee the present-day conditions and future of public. In other words, it is depicted as a system which fulfills the subsistence levels for the ones whose income was interrupted by a social or professional risk, without any appeal for the help of others. But even so, it is the laborers at the center of gravi-ty.128

Talas emphasizes on the fact that intervention of state to this field is obligatory especially in the less-developed countries. The lack of collec-tive negotiation power of the workers129 –who are mostly in need of social security as wage rates don’t compensate for the social and occu-pational risks and they are not yet well organized – indicates the need for state intervention.130 In this direction, it is not a coincidence that social insurance found place in the political programs of the parties re-gardless of their political tendencies in the aftermath of the transition of multiparty democracy in 1946 in Turkey. Ministry of Labor was found in 1945, worker insurance was handled at the same period and estab-lishment of unions was allowed by law in the same years.131 This law is important in the sense that the very first article of the law declares that government has a command for the policies of the Institution of Worker Insurance. Hence it can be seen that the social security system progres-sively obtained a nature of a government service and was perceived as a part of the government spending. The financing was obtained by tax

128 Orhan Tuna, “SoOrhan Tuna, “Sosyal Güvenlik Meselemizsyal Güvenlik Meselemiz,,”” İÜSSKD, İÜSSKD, no. 7 (1955):no. 7 (1955): 8585..

129 In Talas’ viewpoint, this fact is wired into the lack of unions and legislation that would In Talas’ viewpoint, this fact is wired into the lack of unions and legislation that would regulate the relations between employer and employee, absence of employer unionism regulate the relations between employer and employee, absence of employer unionism and the nonexistence of theand the nonexistence of the right to strike. Talas,“right to strike. Talas,“ Kolektif İş Mukaveleleri Bakımından Kolektif İş Mukaveleleri Bakımından Türkiye’nin DurumuTürkiye’nin Durumu,,” ” AÜSBFAÜSBFDD 9, no. 1 (9, no. 1 (19541954):): 77--1010..

130 Talas, “Sosyal SigortalarımızTalas, “Sosyal Sigortalarımız,,” 1” 15;5; Talas, “Türkiye’de SosyalTalas, “Türkiye’de Sosyal,,” 5” 5.. As for the tendencies As for the tendencies towards insurance; it can be said that old age, distowards insurance; it can be said that old age, disability and burials insurance were ability and burials insurance were the main branches of social insurance as they could find place in law. Suggestions on the main branches of social insurance as they could find place in law. Suggestions on determination of payments, financing, and implementation fields of these branches determination of payments, financing, and implementation fields of these branches were examined by Talas.were examined by Talas.

131 Talas, “Türkiye’de SosyalTalas, “Türkiye’de Sosyal,,”” 5. 5.

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income and the scope of the social security services began to expand with the intention of comprehending the whole society.132

A central part of social insurance is pronounced as the unemploy-

A central part of social insurance is pronounced as the unemploy-ment insurance,ment insurance,133 although it could not find place even in the Labor although it could not find place even in the Labor Law.Law.134 It is argued that even Kessler regarded it as a pointless exertion It is argued that even Kessler regarded it as a pointless exertion and didn’t recommend the establishment of this insurance in current and didn’t recommend the establishment of this insurance in current conditions.conditions.135 The difficulties behind the formation of unemployment The difficulties behind the formation of unemployment insurance insurance wewere depicted as the ambiguities on a propre depicted as the ambiguities on a proper description of er description of unemployment, the rates of incomes and wages, the question whether unemployment, the rates of incomes and wages, the question whether the employers would participate in dues or not and the determination the employers would participate in dues or not and the determination of to what degree the whiteof to what degree the white--collar workers would be taken into consid-collar workers would be taken into consid-

132 Talas, “Sosyal Sigortalarımız Hakkında MülahazalarTalas, “Sosyal Sigortalarımız Hakkında Mülahazalar,,” 15” 15..

133 Orhan Orhan Tuna, “Memleketimizde İşsizlik Sigortası MeselesiTuna, “Memleketimizde İşsizlik Sigortası Meselesi,,” ” İÜİFM İÜİFM 14, no. 114, no. 1--4 (1952): 4 (1952): 210210.. It was It was remarkableremarkable that the very first report on the unemployment insurance was that the very first report on the unemployment insurance was prepared for the applicationprepared for the application of Association of Journalists with the Union of Journalist of Association of Journalists with the Union of Journalist to the Faculty of Economics for the purpose of establishing an unemployment insur-to the Faculty of Economics for the purpose of establishing an unemployment insur-ance common to the members of that profession.ance common to the members of that profession.

134 IbIbiidd., ., 211211--213213.. Tuna presents a historical background of social iTuna presents a historical background of social insurance implementa-nsurance implementa-tions. He says that ations. He says that although the roots of these policies are traced to the 15lthough the roots of these policies are traced to the 15thth--1616thth cen-cen-turies in many countries, the distinguishing features of them in the modern era are turies in many countries, the distinguishing features of them in the modern era are that they are perceived as vital and implemented by the hand of gthat they are perceived as vital and implemented by the hand of government. This is overnment. This is very much related with the evolution of very much related with the evolution of the the capitalist system. By 1815 the economic capitalist system. By 1815 the economic depressiondepression,, mass workers have undergone unemployment which led to a grave situa-mass workers have undergone unemployment which led to a grave situa-tion. The ongoing social problem turned to be totally tense then. It was ation. The ongoing social problem turned to be totally tense then. It was a negligible fact negligible fact for the industrialized countriesfor the industrialized countries.. TThe very first country that implemented unemploy-he very first country that implemented unemploy-ment insurance is the Great Britain before the Wment insurance is the Great Britain before the World orld WWar ar I. As for Turkey,I. As for Turkey, says Tuna, says Tuna, this issue could not find place even in the Labor Law in 1936 as it is this issue could not find place even in the Labor Law in 1936 as it is not an easy task to not an easy task to create unemployment insurancecreate unemployment insurance and portrays and portrays some formidable issuessome formidable issues. For instance, he . For instance, he argues that argues that the risk of unemployment was first periodical but then massive which the risk of unemployment was first periodical but then massive which turned out to be more difficult to organize. turned out to be more difficult to organize. In addition, tIn addition, the risk of uhe risk of unemployment is nemployment is casual, the probability is hard to be calculated. The financing is also problematic due to casual, the probability is hard to be calculated. The financing is also problematic due to the relative importance of the types of unemployment some of which might be based the relative importance of the types of unemployment some of which might be based on immaterial reasons. Moreover, the scope of the unemployment insuron immaterial reasons. Moreover, the scope of the unemployment insurance is also ance is also significant. The involvement of the public is essentialsignificant. The involvement of the public is essential,, at least it must contain the in-at least it must contain the in-dustrial workers. All these result in deficiencies and difficulties in formation of unem-dustrial workers. All these result in deficiencies and difficulties in formation of unem-ployment insurance.ployment insurance. Ibid., 212Ibid., 212--214.214.

135 Ekmel Zadil, “Sosyal SigortaEkmel Zadil, “Sosyal Sigortaların Mahiyet ve Vazifeleriların Mahiyet ve Vazifeleri,,”” İÜSSKD, İÜSSKD, no. 3 (1950): no. 3 (1950): 5050..

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eration.

eration.136 Yet, the lack of statisYet, the lack of statistical data/information on these issues tical data/information on these issues impede the implementation of such policies in developing countries impede the implementation of such policies in developing countries with respect to the developed countries.with respect to the developed countries.

The function of social insurance

The function of social insurance wawas revealed as a safeguard against s revealed as a safeguard against social dissatisfaction and radicalism. Isocial dissatisfaction and radicalism. It t wawas argued that in countries s argued that in countries wherewhereinin social insurance is well developed, the reliance on state and social insurance is well developed, the reliance on state and adherence to society increases and worker becomes more conservative. adherence to society increases and worker becomes more conservative. Hence, we again feel the emphasis on the necessity of collaboration be-Hence, we again feel the emphasis on the necessity of collaboration be-tween state and tween state and workers instead of demands triggered by the class an-workers instead of demands triggered by the class an-tagonism. No matter how frequently the significance of the better condi-tagonism. No matter how frequently the significance of the better condi-tions for the workers tions for the workers wawas highlighted, the discourse of the academics s highlighted, the discourse of the academics never crosses the border of the existing economic system and ennever crosses the border of the existing economic system and enterter into into the gravitational field of the radical ideologies.the gravitational field of the radical ideologies.

5.3.3.3 UnionismUnionism

The birth of unionism is portrayed as a spontaneous process by Orhan

The birth of unionism is portrayed as a spontaneous process by Orhan Tuna, a reflex and a reaction in the face of a poignant oppression and Tuna, a reflex and a reaction in the face of a poignant oppression and power. Its development then has kept up withpower. Its development then has kept up with the daily needs and reali-the daily needs and reali-ties which made them to become distanced from theories and ideolo-ties which made them to become distanced from theories and ideolo-gies.gies.137 By identifying unionism as a selfBy identifying unionism as a self--help mechanism that functions help mechanism that functions from bottom to top, it is also depicted as a distanced field from public from bottom to top, it is also depicted as a distanced field from public intervention by naturintervention by nature, as the state measures are top to bottom.e, as the state measures are top to bottom.138 It is It is also highlighted that the modern unionism has no dealings with the also highlighted that the modern unionism has no dealings with the charitable organizations as well, it is defined as a conscious and united charitable organizations as well, it is defined as a conscious and united

136 Tuna,Tuna, “Memleketimizde İşsizlik“Memleketimizde İşsizlik,”,” 215215. . Ekmel Zadil claims that although other branches Ekmel Zadil claims that although other branches of social insurance was acknowledged in developed of social insurance was acknowledged in developed WWestern countries, unemployment estern countries, unemployment insurance exist only in very insurance exist only in very few countries since its implementation is very difficult.few countries since its implementation is very difficult. Zadil,Zadil, “Sosyal Sigortaların“Sosyal Sigortaların,” ,” 4949--5050..

137 OrhanOrhan Tuna, “Sendikacılık ve SiyasetTuna, “Sendikacılık ve Siyaset,,” ” İÜSSKD, İÜSSKD, no. 7 (no. 7 (1951955): 5): 108108..

138 Tuna, “Sendikacılık ve SiyasetTuna, “Sendikacılık ve Siyaset,,” 107” 107..

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instrument.

instrument.139 Based on the observations on the academic and confeBased on the observations on the academic and confer-r-ence texts, it can be said that a prevalent theme was empowering ence texts, it can be said that a prevalent theme was empowering the the public opinion of the working class. The necessity of a proper function-public opinion of the working class. The necessity of a proper function-ing of the selfing of the self--help mechanism, the existence of class consciousness help mechanism, the existence of class consciousness among the workers and a firm cognition on consamong the workers and a firm cognition on considering unions as the idering unions as the organs of struggle for their own interest were introduced as require-organs of struggle for their own interest were introduced as require-ments.ments.140 To strengthen unionism, Nusret Ekin recommends allowance To strengthen unionism, Nusret Ekin recommends allowance of workers to express their ideas about official economic policies, of workers to express their ideas about official economic policies, productivityproductivity141, cost of living, ha, cost of living, hard currency, trade regimes and, think rd currency, trade regimes and, think together and systematically work on these issues.together and systematically work on these issues.142

Similar with the circumstance in the social insurance system, two

Similar with the circumstance in the social insurance system, two preconditions were depicted for unionism to be developed: the birth of preconditions were depicted for unionism to be developed: the birth of an industrial working class anan industrial working class and the existence of a political/legal regime d the existence of a political/legal regime that allows room for establishment and operations of independent un-that allows room for establishment and operations of independent un-ions.ions.143 Even also the presence of such a right wasn’t found enough. Ta-Even also the presence of such a right wasn’t found enough. Ta-las argues that a country should intimately believe in the benefit of un-las argues that a country should intimately believe in the benefit of un-ionsions and the unions should not be considered as institutions to be and the unions should not be considered as institutions to be

139 OrhanOrhan TunaTuna,, “Memleketimizde Sendikacılık Hareket“Memleketimizde Sendikacılık Hareketlerinin Gelişmesi ve İşçilerimizin lerinin Gelişmesi ve İşçilerimizin Sendikalaşması MeselesSendikalaşması Meselesi,”i,” İÜSSKDİÜSSKD, no. 6 (, no. 6 (19541954): ): 6464..

140 Orhan Orhan Tuna, “Türk Sendikacılığının Başlıca Meseleleri ve Son GelişmelerTuna, “Türk Sendikacılığının Başlıca Meseleleri ve Son Gelişmeler,,” ” İÜİFM İÜİFM 24, 24, no. 3no. 3--4 (1965):4 (1965): 1212--14. Tuna14. Tuna categorizes the difficulties that arose from the econocategorizes the difficulties that arose from the economy, my, the quantitative and qualitative structure of labor, employer, the structure of the un-the quantitative and qualitative structure of labor, employer, the structure of the un-ions and unethical management of union leaders, political, legal and social environ-ions and unethical management of union leaders, political, legal and social environ-ment. Unionism in Turkey is bound to the emergence of an industrial working class ament. Unionism in Turkey is bound to the emergence of an industrial working class as s the industrial life achieves a certain level. Yet, the industrialization process functions the industrial life achieves a certain level. Yet, the industrialization process functions slowly. According to the statistical data obtained in 1962, the 76 slowly. According to the statistical data obtained in 1962, the 76 percentpercent of the labor of the labor was still engaged in agriculture. In addition, it is argued that the perpetwas still engaged in agriculture. In addition, it is argued that the perpetual movements ual movements of the workers in between the rural and the urban (agriculture and industry) had neg-of the workers in between the rural and the urban (agriculture and industry) had neg-ative effects on unionism. In addition, not all the segments of society were equally ative effects on unionism. In addition, not all the segments of society were equally participated in unionist organizations. It is also observed that the womeparticipated in unionist organizations. It is also observed that the women were mostly n were mostly indifferent to unionism due to the traditional background and general cultural levels. indifferent to unionism due to the traditional background and general cultural levels.

141 NusretNusret Ekin, “Sendikalar ve ProdüktiviteEkin, “Sendikalar ve Prodüktivite,,” ” İÜSSKDİÜSSKD, no. 16 (1965): , no. 16 (1965): 7070..

142 Tuna, “Memleketimizde Sendikacılık HareketlerininTuna, “Memleketimizde Sendikacılık Hareketlerinin,” ,” 6767..

143 Talas, “Türk Sendikalizminin Bugünkü Durumu ve Gelişme ŞartlarıTalas, “Türk Sendikalizminin Bugünkü Durumu ve Gelişme Şartları,,” ” AÜSBFAÜSBFDD 9, no. 4 9, no. 4 ((1951954): 4): 11..

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tolerated, but affirmed as necessary and useful entities.

tolerated, but affirmed as necessary and useful entities.144 In addition, In addition, unions were interpreted as important mechanisms in preventing the unions were interpreted as important mechanisms in preventing the pointless strikes as the existence of unions guaranteespointless strikes as the existence of unions guarantees the rationalistic the rationalistic behavior of the workers instead of the emotive ones. Therefore, unions behavior of the workers instead of the emotive ones. Therefore, unions were regarded as beneficial and supportive, not only for employees but were regarded as beneficial and supportive, not only for employees but also employers.also employers.145

Through all these evaluations, there

Through all these evaluations, there isis nothing extraordinary when nothing extraordinary when we think ofwe think of the emphasis of the academics on cooperation of classes the emphasis of the academics on cooperation of classes instead of triggering instead of triggering a a conflict between them. But the following two conflict between them. But the following two points points might soundmight sound unexpected unexpected to some degreeto some degree. Especially through the . Especially through the texts in Social Policy Conferences by Istanbul University, a texts in Social Policy Conferences by Istanbul University, a tendency to tendency to assess the relationship between the unions and political parties as unfa-assess the relationship between the unions and political parties as unfa-vorablevorable can be seencan be seen..146 Tuna for instance, strongly emphasizes that this Tuna for instance, strongly emphasizes that this embeddedness might distract the unions from their basic goalsembeddedness might distract the unions from their basic goals. T. They hey might be instrumentmight be instrumentss to party polto party politics. The reason is portrayed as the itics. The reason is portrayed as the actual weakness of the unionsactual weakness of the unions.. BBeing influenced by the daily politics and eing influenced by the daily politics and different ideologies carries the risk of weakening it further indeed. For different ideologies carries the risk of weakening it further indeed. For him, this method of the industrialized countries should be avoided in him, this method of the industrialized countries should be avoided in Turkey.Turkey.147

Another important theme occurs as the emphasis on the material

Another important theme occurs as the emphasis on the material and moral vitalism for the Turkish unions to integrate into Milletlerarası and moral vitalism for the Turkish unions to integrate into Milletlerarası Hür Sendikalar İttihadıHür Sendikalar İttihadı (International Confederation of Free Trade Un-(International Confederation of Free Trade Un-ions)ions) founded in London in 1949, which sfounded in London in 1949, which supports NATO’s objectives.upports NATO’s objectives.148 Confronting with such an emphasis was both presumable and surpris-Confronting with such an emphasis was both presumable and surpris-ing. It was presumable in the sense that we witness many translations ing. It was presumable in the sense that we witness many translations from the academics of the USA among the Social Policy Conferences from the academics of the USA among the Social Policy Conferences

144 IbidIbid., ., 22..

145 TunaTuna,, “İşçi Sendikalarının Mahiyet ve Vazifeleri“İşçi Sendikalarının Mahiyet ve Vazifeleri,,”” İÜSSKD,İÜSSKD, no. 3 (1950):no. 3 (1950): 137137..

146 TunaTuna, , “Sendikacılık ve Siyaset“Sendikacılık ve Siyaset,,”” 120120..

147 Tuna,Tuna, “İşçi Sendikalarının“İşçi Sendikalarının,” ,” 139139.. For the detailed analysis of the method in the For the detailed analysis of the method in the industrialized countriesindustrialized countries see Tuna, see Tuna, 111111--115115..

148 Tuna, “Memleketimizde Sendikaların Üzerinde Durdukları MeselelerTuna, “Memleketimizde Sendikaların Üzerinde Durdukları Meseleler,,” ” İÜSSKDİÜSSKD,, no. 8 no. 8 (1956): (1956): 117117..

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which began in 1948. The tr

which began in 1948. The traces of Americanization in Turkey can even aces of Americanization in Turkey can even be visible by a brief scan. As is knownbe visible by a brief scan. As is known,, it was the Cold War period, and it was the Cold War period, and Turkey has taken side with liberal democratic capitalism. Besides both Turkey has taken side with liberal democratic capitalism. Besides both the ruling and opposition parties were supporting the entrance to NATthe ruling and opposition parties were supporting the entrance to NATO O regardless of their political stance. However, it was regardless of their political stance. However, it was unexpected unexpected to see a to see a support for a procured participation on NATO’s objectives by the un-support for a procured participation on NATO’s objectives by the un-ions. If so, there must be an assumption that locates NATO as a political-ions. If so, there must be an assumption that locates NATO as a political-ly neutral institution, out of the politly neutral institution, out of the political axis, as the political influences ical axis, as the political influences were pronounced harmful for the unions.were pronounced harmful for the unions.

Yet, the 1960s witnessed a politization among many segments of the

Yet, the 1960s witnessed a politization among many segments of the society including the workers. Additionally, the main extension of the society including the workers. Additionally, the main extension of the unionist movements came after the 1960 unionist movements came after the 1960 revolution, during the second revolution, during the second RRepublican era. Then, bracing up by the new social perceptions of the epublican era. Then, bracing up by the new social perceptions of the revolution, the unionist movements switched from their static situation revolution, the unionist movements switched from their static situation and gained dynamism at an instant.and gained dynamism at an instant.149 Even so, it is important to note Even so, it is important to note that the naturethat the nature of Turkish unionism was neither characterized as doc-of Turkish unionism was neither characterized as doc-trinaltrinal--ideological nor tied to the philosophical and religious principles ideological nor tied to the philosophical and religious principles by the academics.by the academics.150 The absence of doctrinal divergences among work-The absence of doctrinal divergences among work-ers or other segments of the society and the nonexistence of thers or other segments of the society and the nonexistence of the idea of e idea of “class struggle” “class struggle” –– which was interpreted as a waste of time and energy which was interpreted as a waste of time and energy for the workersfor the workers –– were exhibited as the strengths of Turkish unionism. were exhibited as the strengths of Turkish unionism. Thence, the unions in Turkey were affirmed as the means of develop-Thence, the unions in Turkey were affirmed as the means of develop-ment and protection of workers’ rightsment and protection of workers’ rights instead of being the means of instead of being the means of class struggle as they were in most of the countries.class struggle as they were in most of the countries.151

Notwithstanding, there

Notwithstanding, there wewere complicating factors for unionism to be re complicating factors for unionism to be properly established including issues about workers, employers and properly established including issues about workers, employers and public opinion. It public opinion. It wawas argued that s argued that the workers were mostly focused to the workers were mostly focused to

149 Tuna, “Türk SendikacılığınınTuna, “Türk Sendikacılığının,” ,” 66.. It is important to note that the constituent assembly It is important to note that the constituent assembly in 1961 involved six union representative/manager and there were many meetings in 1961 involved six union representative/manager and there were many meetings organized in between the related ministries and the unorganized in between the related ministries and the unions.ions.

150 IbidIbid., ., 33--55.. see also Orhan Tuna “Sendikacılık ve Siyasetsee also Orhan Tuna “Sendikacılık ve Siyaset,,”” 109109; ; Walter Galenson, “Az Walter Galenson, “Az Gelişmiş Memleketlerde SendikacılıkGelişmiş Memleketlerde Sendikacılık,,”” İÜSSKDİÜSSKD, no. 16, (1965):, no. 16, (1965): 6161--6262..

151 Talas, “Türk SendikalizmininTalas, “Türk Sendikalizminin,,” 13” 13--1414..

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guarantee the future without having a high opinion on the social status

guarantee the future without having a high opinion on the social status of the union which attracts the attention to the need of acquiring of the union which attracts the attention to the need of acquiring awareness about the function of the unions. As for awareness about the function of the unions. As for the the class of employ-class of employ-ers, it ers, it wawas s argued that they are not established on a strong tradition like argued that they are not established on a strong tradition like their Western counterparts,their Western counterparts,152 most of them switched from agriculture most of them switched from agriculture or trade to the industrial sector within an individualistic mindset and or trade to the industrial sector within an individualistic mindset and without strong attention to the social problems.without strong attention to the social problems.153 PuPublic’s unfamiliarity blic’s unfamiliarity with the social issues and skepticism on unions with the social issues and skepticism on unions –– as if the unions sym-as if the unions sym-bolize an ideological characterbolize an ideological character –– also result in a tendency to confuse the also result in a tendency to confuse the unionist movements with doctrinal flows.unionist movements with doctrinal flows.154 Notwithstanding, these Notwithstanding, these weaknesses were considereweaknesses were considered as temporary and the reasons behind all d as temporary and the reasons behind all these were presumed to be easily eliminated by effort and sympathy. In these were presumed to be easily eliminated by effort and sympathy. In overcoming all these problems, education was highlighted as a key solu-overcoming all these problems, education was highlighted as a key solu-tion tion in the sense thatin the sense that acacquiring quiring aan awareness n awareness about the benefits of un-about the benefits of un-ionions can be s can be obtaineobtained by educationd by education..155 Consequently, the authors seem to Consequently, the authors seem to be hopeful about the future ofbe hopeful about the future of aa properly organized unionism that is properly organized unionism that is determined to stay out of the political flows. The social future of Turkey determined to stay out of the political flows. The social future of Turkey was then was then considered to be dependent upon the considered to be dependent upon the fellowship and sincerity fellowship and sincerity on acknowledging each other as economic and social partners.on acknowledging each other as economic and social partners.156

§ 5.4 Concluding RemarksConcluding Remarks

A careful reader would notice the disparities in content between the

A careful reader would notice the disparities in content between the sections of the “sections of the “HHistory of istory of SSocial ocial PPolicy in Turkey” and “olicy in Turkey” and “SSocial ocial PPolicy in olicy in AAccademic ademic TTexts and exts and JJournals”. ournals”. By saying this, By saying this, II pointedlypointedly mean themean the pres-pres-

152 Tuna, “Türk SendikacılığınınTuna, “Türk Sendikacılığının,”,” 1515..

153 IbidIbid.,., 1616..

154 Ibid.,Ibid., 1919..

155 Ekmel Ekmel Zadil, “İşçi ve Sendikacıların EğitimiZadil, “İşçi ve Sendikacıların Eğitimi,,” ” İÜSSKD, İÜSSKD, no. 7 (1955): no. 7 (1955): 125.125.

156 Tuna, Tuna, ““Türk SendikacılığınınTürk Sendikacılığının,”,” 2828..

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ence of the

ence of the slight distinction between the authors conceptualizations on slight distinction between the authors conceptualizations on social policy who later evaluates the social policy implementations in social policy who later evaluates the social policy implementations in TurkeyTurkey and the academic economists’ conceptand the academic economists’ conceptionionss on social policy and on social policy and içtimai iktisat in the mentioned period. içtimai iktisat in the mentioned period. For instance, For instance, the basic concern the basic concern ofof Buğra is whether social policies are implemented in a rightBuğra is whether social policies are implemented in a right--based based way or not, giving importance to the forms of benevolence as an im-way or not, giving importance to the forms of benevolence as an im-portant indicator of the stateportant indicator of the state--society relations.society relations.157 This themeThis theme waswas also also frequently mentioned through the writings of the acafrequently mentioned through the writings of the academics, but what demics, but what they were mostly engaged they were mostly engaged inin seem to beseem to be the economic and political ben-the economic and political ben-efits of social policy. In other words, the function of social policy in efits of social policy. In other words, the function of social policy in terms of its efficacies on economic productivity, economic improve-terms of its efficacies on economic productivity, economic improve-ment/development process and prment/development process and provision of social balance seemovision of social balance seem to beto be more at the more at the heart of the writings.heart of the writings. Social policy Social policy wawas portrayed to serve s portrayed to serve for troublefor trouble--free operation of the system without any stoppage. In rela-free operation of the system without any stoppage. In rela-tion to this, its protective function against drifting towards the radical tion to this, its protective function against drifting towards the radical idideologies eologies wawas s frequently frequently highlighted, hence social policy appearhighlighted, hence social policy appeareded as as an apparatus of an apparatus of a a control mechanism in a sense. Such a conceptualiza-control mechanism in a sense. Such a conceptualiza-tion in that period is understandable as the tion in that period is understandable as the CCold old WWar conditions polar-ar conditions polar-ized the world and Turkey located itself at the lized the world and Turkey located itself at the liberal capitalist democ-iberal capitalist democ-racies’ side. Indeed, the ideological preference was already determined racies’ side. Indeed, the ideological preference was already determined even before the wareven before the war;; Turkey, from the very beginning of the Turkey, from the very beginning of the RRepublic, epublic, and even since the second constitutional era, haand even since the second constitutional era, hadd chosen a national cap-chosen a national cap-italist development italist development model. Yet, although the economic aspects come to model. Yet, although the economic aspects come to the forefront in social policy envisions, this the forefront in social policy envisions, this doesn’tdoesn’t meanmean that theythat they ig-ig-norenored d the embedded social benefit the embedded social benefit generated by social policies generated by social policies for the for the masses.masses.

The

The amount ofamount of material published on social policy tremematerial published on social policy tremendously in-ndously in-creased especially after the Wcreased especially after the World orld WWar ar II, which might be related with II, which might be related with the formation of a substantial working class by the ruralthe formation of a substantial working class by the rural--urban migra-urban migra-tion in the 1950s. When looktion in the 1950s. When looking ing at the intensity of the social policy con-at the intensity of the social policy con-ferences of the academics during ferences of the academics during the 1950s and their effort to publicize the 1950s and their effort to publicize

157 Buğra, Buğra, Kapitalizm, Yoksulluk, Kapitalizm, Yoksulluk, 13.13.

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the knowledge produced,

the knowledge produced, one canone can feel the impression that this reper-feel the impression that this reper-toire might be an influential guide behind the emancipatory essence of toire might be an influential guide behind the emancipatory essence of the 1960s the 1960s CConstitution in social/civil rights. It onstitution in social/civil rights. It might be identified amight be identified as s doingdoing science for the “society”.science for the “society”.158 Although they sometimes complainAlthough they sometimes complaineded about the indifference of the audience, their faith in social change seems about the indifference of the audience, their faith in social change seems to works as a catalyzer for their endeavor. to works as a catalyzer for their endeavor.

The contributions of the academics

The contributions of the academics wewere significant then both in re significant then both in theorettheoretical and practical fields. Social policy as a child of ical and practical fields. Social policy as a child of the the capitalist capitalist system would obviously system would obviously have have pursuepursuedd a different path in a late capital-a different path in a late capital-ized rural country like Turkey. Even so, the key elements of social policy ized rural country like Turkey. Even so, the key elements of social policy in this country were shaped within the dyin this country were shaped within the dynamics that would ensure a namics that would ensure a rapid economic development within the boundaries of the capitalist rapid economic development within the boundaries of the capitalist system in a rational and a “humane” manner. There occurred theoretical system in a rational and a “humane” manner. There occurred theoretical renovations as in the case of Kessler who played the renovations as in the case of Kessler who played the leadingleading role in role in breaking up the old Dubreaking up the old Durkheimian tradition of doing sociology. By bring-rkheimian tradition of doing sociology. By bring-ing forward the division between “cemaat” and “cemiyet”, he attributeing forward the division between “cemaat” and “cemiyet”, he attributedd subjectivity to the individuals of the “cemiyet” who subjectivity to the individuals of the “cemiyet” who wewere expected to act re expected to act in a “rational” manner. in a “rational” manner.

The rationality assumption

The rationality assumption wawas also cos also confronted in Talas’ writings. It nfronted in Talas’ writings. It is no doubt that each author was aware that there exist irrational as-is no doubt that each author was aware that there exist irrational as-pects in human behavior, but both Talas and Kessler had faith in the es-pects in human behavior, but both Talas and Kessler had faith in the es-tablishment of tablishment of a a rational thinking as much as possible as they intend to rational thinking as much as possible as they intend to generate thgenerate the substance of social policy in a scientific way. While the es-e substance of social policy in a scientific way. While the es-tablishment of a revolutionary theoretical base in Istanbul University tablishment of a revolutionary theoretical base in Istanbul University and breathing a soul into the social policy by leading off the social policy and breathing a soul into the social policy by leading off the social policy conferences were mostly undertaken by Gerhard conferences were mostly undertaken by Gerhard Kessler, provision of Kessler, provision of additional roadmaps for the policies to be implemented within a scope additional roadmaps for the policies to be implemented within a scope enriched by a comparative perspective embracing both the economic enriched by a comparative perspective embracing both the economic

158 “Scientific activity, especially in social and political sciences, is not making abstr“Scientific activity, especially in social and political sciences, is not making abstract act analysis by distancing from the phenomena and living in his own world. The scholastic analysis by distancing from the phenomena and living in his own world. The scholastic university approach which adopted such a behavior was only existent in a few places university approach which adopted such a behavior was only existent in a few places in the world, in fascist, theocratic and communist realms. It is not present in thin the world, in fascist, theocratic and communist realms. It is not present in the liberal e liberal world.” Cahit Talasworld.” Cahit Talas,, “Üniversite, Toplum ve Politika“Üniversite, Toplum ve Politika,,”” AÜSBFAÜSBFDD 21,21, no. 3 (no. 3 (19661966): ): 1010--1111..

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and social aspects was conducted by Cahit Talas in Mülkiye. In fact,

and social aspects was conducted by Cahit Talas in Mülkiye. In fact, while comparing these two fouwhile comparing these two founding figures, nding figures, itit should also should also be be men-men-tiontioned thated that Kessler haKessler hadd already left Turkey in the early 1950s, during already left Turkey in the early 1950s, during when when the most productive years of Talas have not yet to come. At this the most productive years of Talas have not yet to come. At this point, maybe it would be more meaningful to compare Talas’ legacy point, maybe it would be more meaningful to compare Talas’ legacy with the succwith the successors of Kessler, especially with Orhan Tuna, the chair of essors of Kessler, especially with Orhan Tuna, the chair of SSocial ocial PPolicy in Istanbul University who considerably contributed to the olicy in Istanbul University who considerably contributed to the social policy conferences and foundation of the first employer union, social policy conferences and foundation of the first employer union, namely Tnamely TÜRKÜRK--İŞİŞ, with Kessler. Talas , with Kessler. Talas wawas more engaged into the issues s more engaged into the issues related with wage policies and productivity increase while Tuna mostly related with wage policies and productivity increase while Tuna mostly concentrateconcentratedd on the matters related with unionismon the matters related with unionism in his articlesin his articles. There . There are no excessive divergences between their perspectivesare no excessive divergences between their perspectives, commonalities , commonalities are more on the front burner. A remarkable commonality might be are more on the front burner. A remarkable commonality might be iden-iden-tified tified as their eschewal from being doctrinaire, an as their eschewal from being doctrinaire, an clearcutclearcut distance they distance they kept from the socialist and communist ideas. Besides, it was also kept from the socialist and communist ideas. Besides, it was also nota-nota-ble ble to discern that the Ameto discern that the American way of doing social policy seemrican way of doing social policy seemeded to to dominate the conceptualizationsdominate the conceptualizations ofof the conference series in Istanbul the conference series in Istanbul University, which might be associated with the zeitgeist.University, which might be associated with the zeitgeist.159

Consequently, as I have previously mentioned referring to Buğra,

Consequently, as I have previously mentioned referring to Buğra, “the fight is between the ones who try to protect capitalism as it is and “the fight is between the ones who try to protect capitalism as it is and the ones who struggle for transforming it into a different thingthe ones who struggle for transforming it into a different thing..” The ” The immense effort by the academics in acting uponimmense effort by the academics in acting upon the development of the development of social policies both as a part of the economics discipline and the politi-social policies both as a part of the economics discipline and the politi-cal/social life proves that a science of economics free from a social es-cal/social life proves that a science of economics free from a social es-sence still cannot be imagined for thsence still cannot be imagined for thatat current era and there existed the current era and there existed the intent to transfointent to transform capitalism into a “different thing” by relieving the rm capitalism into a “different thing” by relieving the living conditions of the masses and living conditions of the masses and providing providing socioeconomic improve-socioeconomic improve-ment, beyond the traditional philanthropic relations or potential an-ment, beyond the traditional philanthropic relations or potential an-swers of free market system swers of free market system visvis--àà--visvis the problem of the problem of ““living togeliving togetherther””..160

159 Tuna, Ekin and Zaim all have studied at Cornell University in the USA at some point of Tuna, Ekin and Zaim all have studied at Cornell University in the USA at some point of their careers.their careers.

160 Buğra, “Sosyal Politika DüşüncesiBuğra, “Sosyal Politika Düşüncesi,,” 45” 45..

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6 Development EconomicsDevelopment Economics

evelopment economics occurred as a core agenda especially after

evelopment economics occurred as a core agenda especially after the Wthe World orld WWar ar II and various theories regarding many develop-II and various theories regarding many develop-ment possibilities for the less developed world were pervaded more ment possibilities for the less developed world were pervaded more rapidly since then. Disseminatrapidly since then. Dissemination of theories investigating ways for ion of theories investigating ways for economic and social progress is also significant for Turkey as a late cap-economic and social progress is also significant for Turkey as a late cap-italized developing country pursuing a national development goal since italized developing country pursuing a national development goal since the Second Constitutional Era. Indeed, it is astonishing that Turkey as athe Second Constitutional Era. Indeed, it is astonishing that Turkey as an n object of analysis did not really attract the attention of the pioneer de-object of analysis did not really attract the attention of the pioneer de-velopment theorists in the current era despite all the weight of the de-velopment theorists in the current era despite all the weight of the de-velopmental efforts in economy and its potential uniqueness as a newly velopmental efforts in economy and its potential uniqueness as a newly established nation stateestablished nation state. Notwithstandi. Notwithstandingng, among various manifesta-, among various manifesta-tions of development economics in different places, contemplating on tions of development economics in different places, contemplating on where Turkey might be located would be a useful exercise that would where Turkey might be located would be a useful exercise that would contribute to the existing literature on developing countries. The pres-contribute to the existing literature on developing countries. The pres-

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ence of

ence of numerous numerous artiarticles related with the developmental issues proves cles related with the developmental issues proves the ongoing centrality of this theme in economics/economy, providing the ongoing centrality of this theme in economics/economy, providing an opportunity to see where academics in Turkey stand regarding this an opportunity to see where academics in Turkey stand regarding this issue. So, this chapter deals with how, when, under what conditions issue. So, this chapter deals with how, when, under what conditions and and by whom the development economics was introduced to the academia by whom the development economics was introduced to the academia in Turkey. Framing the boundaries of this reception would hopefully in Turkey. Framing the boundaries of this reception would hopefully reveal the points how Turkey’s experience differs from the other devel-reveal the points how Turkey’s experience differs from the other devel-oping countries and the main reasons behind theseoping countries and the main reasons behind these differences.differences.

This chapter represents a constitutive element of the whole disser-

This chapter represents a constitutive element of the whole disser-tation when we think the organic linkages between developmenttation when we think the organic linkages between developmental al themesthemes, social policy and public finance. The interrelation of each and , social policy and public finance. The interrelation of each and the embeddedness of them into economics the embeddedness of them into economics as core aspects also reveal as core aspects also reveal how the discipline of economics was conceptualized in the current peri-how the discipline of economics was conceptualized in the current peri-od. When we think chronologically, we might say that the Wod. When we think chronologically, we might say that the World orld WWar ar I I refers to a critical breaking point for social policy, the Great Depression refers to a critical breaking point for social policy, the Great Depression for the approfor the approaches regarding public finance and the Waches regarding public finance and the World orld WWar ar II for II for the spread of the domain for development economics. Nevertheless, the the spread of the domain for development economics. Nevertheless, the developmental history of Turkey can’t be reduced to the widespread developmental history of Turkey can’t be reduced to the widespread acknowledgment of developmental issues after the Wacknowledgment of developmental issues after the World orld WWar ar II. II. In-In-deed, there deed, there exisexistted ed a distinctive theoretical movement a distinctive theoretical movement namelynamely Kadro Kadro in in the early the early 19301930ss, , forerunning the prospective dependency school in Lat-forerunning the prospective dependency school in Lat-in America by generating a local version of it. Even so, we should put in America by generating a local version of it. Even so, we should put forth that the developmental luggage of Turforth that the developmental luggage of Turkey was articulated with the key was articulated with the world experience especially in the 1950s and world experience especially in the 1950s and the the 1960s1960s,, during when during when the desired level the desired level ofof development development hhas not stillas not still beenbeen obtained. Thence, the obtained. Thence, the solution seeking processes engaged in a dialogue with the pioneer de-solution seeking processes engaged in a dialogue with the pioneer de-velopment theorisvelopment theorists around the world.ts around the world.

So, in this chapter, I am engaged with the analysis on how this articu-

So, in this chapter, I am engaged with the analysis on how this articu-lation took place and what local dynamics played the key roles in con-lation took place and what local dynamics played the key roles in con-structing the intended developmental path. The search for potential structing the intended developmental path. The search for potential answers for the questions lianswers for the questions like “in what ways the academics here were ke “in what ways the academics here were receptive receptive of of the theories of the pioneers the theories of the pioneers in in development and which con-development and which con-cepts made sense for them” will be the guiding concerncepts made sense for them” will be the guiding concernss in this chapter. in this chapter. In line with the other chapters of this dissertation, a historical back-In line with the other chapters of this dissertation, a historical back-

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ground for development economicsround for development economics will be presentedwill be presented firstfirst. Next. Next, the, the concept of development within the particular lenses of the different concept of development within the particular lenses of the different schools of thought and different theorists, putting forward to their con-schools of thought and different theorists, putting forward to their con-textual priorities with a special emphasis on thtextual priorities with a special emphasis on the division between the e division between the concepts of growth and developmentconcepts of growth and development will be zoomed inwill be zoomed in. After this theo-. After this theo-retical background, the developmental history of Turkeyretical background, the developmental history of Turkey will be elabo-will be elabo-rated.rated. Then Then comes comes the core of ththe core of thee chapter that reveals the dimensions of chapter that reveals the dimensions of the reception of variothe reception of various theories disseminating around the world. In-us theories disseminating around the world. In-stead of the universalizing claims, the fixations about the intrinsic rea-stead of the universalizing claims, the fixations about the intrinsic rea-sons behind underdevelopment regarding mentality and policy recom-sons behind underdevelopment regarding mentality and policy recom-mendations by the academics exemplifying the unique experience of mendations by the academics exemplifying the unique experience of TurkeyTurkey will be focused.will be focused.

§ 6.1 Historical Background of Development EconomicsHistorical Background of Development Economics

The world order has undergone literal changes both by the two world

The world order has undergone literal changes both by the two world wars. The Wwars. The World orld WWar ar I was clattering the colonial empires while the I was clattering the colonial empires while the period starting from the end of the Wperiod starting from the end of the World orld WWar ar II caII can be memorialized n be memorialized by the decolonization movements all over the world. This dramatic by the decolonization movements all over the world. This dramatic change has also shaped the agenda and the priorities of economy achange has also shaped the agenda and the priorities of economy as s well aswell as politics. Previously, politics. Previously, the developmental issues were not on the the developmental issues were not on the agenda during the colonial period;agenda during the colonial period; in other words, while the colonized in other words, while the colonized countries were devoid of political independence, those countries were countries were devoid of political independence, those countries were considered as partconsidered as partss of the metropolitansof the metropolitans161 wwhich prevented a consid-hich prevented a consid-eration of them as separate entiteration of them as separate entities.ies. However, as the postcolonial However, as the postcolonial movement began amovement began and political independence was obtained,nd political independence was obtained, increased increased political selfpolitical self--reliance and the selfreliance and the self--assertion of African and Asian peoples assertion of African and Asian peoples via nationalism both emerged as the driving forces for developmental via nationalism both emerged as the driving forces for developmental

161 Kazgan, Kazgan, İktisadi Düşünce ve Politik İktisadın Evrimiİktisadi Düşünce ve Politik İktisadın Evrimi, , 264.264.

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concernsconcerns162 which led the which led the international attention gravitate to international attention gravitate to the prob-the prob-lems of the less developed countries.lems of the less developed countries.

Indeed, the attitude towards the less developed world had also

Indeed, the attitude towards the less developed world had also transformed throughout centuries. A significant indicator of the chang-transformed throughout centuries. A significant indicator of the chang-ing approach of the developed countries ing approach of the developed countries visvis--àà--visvis the less developed the less developed ones, caones, can even be tracked by a brief examination on the variations in the n even be tracked by a brief examination on the variations in the naming of the less developed countries over time. In the 18naming of the less developed countries over time. In the 18thth century, century, they were defined as “rude and barbarous” while the 19they were defined as “rude and barbarous” while the 19thth century century brought the usage of “backward” countries. During the brought the usage of “backward” countries. During the prewar period prewar period they were named as “underdeveloped” and now the more widespread they were named as “underdeveloped” and now the more widespread naming has become “less developed, poor, emergent countries and de-naming has become “less developed, poor, emergent countries and de-veloping economies.”veloping economies.”163

Gerald

Gerald Meier, referring to Arndt, claims that before the 1940s, the Meier, referring to Arndt, claims that before the 1940s, the term “economic developterm “economic development” was barely used. The main interpretation ment” was barely used. The main interpretation of economic development was based on “denoting growth in per capita of economic development was based on “denoting growth in per capita real income in underdeveloped countriesreal income in underdeveloped countries..””164 Yet, there is a clearYet, there is a clear--cut cut difference between the concepts of difference between the concepts of development and growthdevelopment and growth. . Kazgan in Kazgan in herher İktisadi Düşünceİktisadi Düşünce asserts that growth refers to creation of a change asserts that growth refers to creation of a change and evolvement in an economic structure by the system within its inner and evolvement in an economic structure by the system within its inner dynamics. Development on the other hand, refers to the conscious occa-dynamics. Development on the other hand, refers to the conscious occa-sional interventions to the matters in case thesional interventions to the matters in case the inner dynamics of the inner dynamics of the society could not create that desired change and evolvement.society could not create that desired change and evolvement.165 As As might be expected, the results of each situation are qualitatively differ-might be expected, the results of each situation are qualitatively differ-ent. ent.

162 Gerald M. Gerald M. MeierMeier, “The Formative Period,” in , “The Formative Period,” in Pioneers Pioneers inin DevelopmentDevelopment,, edited by Gerald edited by Gerald M. Meier and Dudley SeersM. Meier and Dudley Seers (USA: Oxford University Press, Jun(USA: Oxford University Press, June 1985),e 1985), 55..

163 Gerald M. Meier, “The Formative Period,” in Gerald M. Meier, “The Formative Period,” in PioneersPioneers, , 66..

164 IbidIbid., ., 66.. This is valid almost for all the economists before Schumpeter, including him. This is valid almost for all the economists before Schumpeter, including him. The conceptualization of the theme as “development” begins with Colin Clark in 1939, The conceptualization of the theme as “development” begins with Colin Clark in 1939, who haswho has found favor of Keynes. Clark was asserting that the advanced economies in found favor of Keynes. Clark was asserting that the advanced economies in the the early 1930s “were so fully occupied with their own problems that they had not the early 1930s “were so fully occupied with their own problems that they had not the smallest thought to spare for the troubles of the poor and developing countries.” smallest thought to spare for the troubles of the poor and developing countries.” Colin Colin Clark, Clark, “Development Economics: The Early Years,” in “Development Economics: The Early Years,” in PioneersPioneers, 61., 61.

165 Kazgan, Kazgan, İktisadi Düşünce, İktisadi Düşünce, 263.263.

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Although it comes up with an intervention to the system, it should Although it comes up with an intervention to the system, it should be noted that the devebe noted that the developmental methods lopmental methods were not set against the insti-were not set against the insti-tutions of capitalism; on the contrary, the aim was to ensure the birth of tutions of capitalism; on the contrary, the aim was to ensure the birth of capitalism and maintain its subsistence via state intervention andcapitalism and maintain its subsistence via state intervention and eco-eco-nomic planning.nomic planning.166 Yet, what has undergone a challenge by the emeYet, what has undergone a challenge by the emer-r-gence of development economics is the neoclassical assumption gence of development economics is the neoclassical assumption which which was reckoning these institutions as universal with a belief that they was reckoning these institutions as universal with a belief that they would create similar opportunities for each and every country.would create similar opportunities for each and every country.167 How-How-ever, as Myint puts it, such a universalizing viewever, as Myint puts it, such a universalizing view carries the risk of over-carries the risk of over-looking the “fundamental human problems of backwardness on the sub-looking the “fundamental human problems of backwardness on the sub-jective side” as the macro models were “running on their own steam”.jective side” as the macro models were “running on their own steam”.168 Simon Kuznets also shares a similar perspective plus emphasizing the Simon Kuznets also shares a similar perspective plus emphasizing the need for considerable modineed for considerable modifications both in social and institutional cir-fications both in social and institutional cir-cumstances within which the increased product per capita is ob-cumstances within which the increased product per capita is ob-tained.tained.169 Apparently, there was a discontent about the current struc-Apparently, there was a discontent about the current struc-ture as it standture as it standeded. The self. The self--regulating market mechanism seemed to regulating market mechanism seemed to lose its reputlose its reputation during the golden age of capitalism by the promi-ation during the golden age of capitalism by the promi-nence of developmental concerns, but even so these concerns mostly nence of developmental concerns, but even so these concerns mostly served for the sake of capitalism itself.served for the sake of capitalism itself.

The glory days of high development theory spanned about 15 years,

The glory days of high development theory spanned about 15 years, from the seminal paper of Rfrom the seminal paper of Rosensteinosenstein--RodanRodan170 “Problems of Industrial-“Problems of Industrial-

166 Ibid.,Ibid., 263263..

167 Ibid., Ibid., 264264..

168 MeierMeier, “The Formative,” in , “The Formative,” in Pioneers, Pioneers, 7, cited in Hla Myint, “An Interpretation of 7, cited in Hla Myint, “An Interpretation of Economic Backwardness,” Economic Backwardness,” Oxford Economic PapeOxford Economic Papers rs (June 1954:149).(June 1954:149).

169 Ibid., 7, cited in Simon Kuznets, “Quantitative Aspects of Economic Growth of Nations: Ibid., 7, cited in Simon Kuznets, “Quantitative Aspects of Economic Growth of Nations: I. Levels and Variablity of Rates of Growth,” I. Levels and Variablity of Rates of Growth,” Economic Development and Cultural Economic Development and Cultural Change Change (October 1956). (October 1956). In fact, there was also an argument by JacoIn fact, there was also an argument by Jacob Viner who claims b Viner who claims that even in case the per capita income increases, if it is accompanied by a population that even in case the per capita income increases, if it is accompanied by a population increase, there will still be many people living at the margins or below the subsistence increase, there will still be many people living at the margins or below the subsistence level, illiterate and undernourished. level, illiterate and undernourished. Ibid., 7, cited in JacIbid., 7, cited in Jacob Viner, ob Viner, International Trade International Trade and Economic Development and Economic Development (Oxford: Clarendon Press, 1953): 99(Oxford: Clarendon Press, 1953): 99--100.100.

170 Born in Krakow, RosensteinBorn in Krakow, Rosenstein--Rodan Rodan wawas an Austrian development economist who s an Austrian development economist who immigrateimmigratedd to Britain in 1930 to Britain in 1930 and and thenthen toto America. He worked in the World Bank andAmerica. He worked in the World Bank and MIT. Alacevich claims that he is recognized as the most important economic theoreti-MIT. Alacevich claims that he is recognized as the most important economic theoreti-

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ization of Eastern and South

ization of Eastern and South--Eastern Europe” (1943) to the publication Eastern Europe” (1943) to the publication of Hirschman’s of Hirschman’s The The Strategy of Economic DevelopmentStrategy of Economic Development (1958).(1958).171 By the By the spread of the development theories in the 1940s and by the midspread of the development theories in the 1940s and by the mid--1950s, 1950s, the notthe notion of ion of ““structural changestructural change”” was much more emphasized. This is was much more emphasized. This is because during the postwar atmosphere in Europe, there occurred a because during the postwar atmosphere in Europe, there occurred a desire for egalitarianism in economies and this desire for egalitarianism in economies and this wawas acs acknowledgedknowledged as a as a prevalently expressed principal.prevalently expressed principal.172 By the decolonization movBy the decolonization movements ements and emergence of new independent countries, the main problematic and emergence of new independent countries, the main problematic turned out to be how these less developed countries can reach the turned out to be how these less developed countries can reach the standards of the developed countries. standards of the developed countries. The lack of demand, scarcity of The lack of demand, scarcity of capital and the widespread hidden rural employmecapital and the widespread hidden rural employment were presented nt were presented among the main problems and an intervention among the main problems and an intervention –– a state intervention a state intervention indeedindeed –– was considered an essential ingredient to reverse the situa-was considered an essential ingredient to reverse the situa-tion.tion.173

By the end of the W

By the end of the World orld WWar ar II, II, the the United States shouldered the re-United States shouldered the re-sponsibility to stabilize thesponsibility to stabilize the economies economies –– the liberal economiesthe liberal economies –– in the in the bipolar Cold War atmosphere. bipolar Cold War atmosphere. Grants and fiscal aids were disbursed to Grants and fiscal aids were disbursed to the countries to tidy their economies up and to prevent probable incli-the countries to tidy their economies up and to prevent probable incli-nations to the opponent ideology in developing countries. The newly nations to the opponent ideology in developing countries. The newly estaestablished institutions of the 1944 Bretton Woods System that are IMF, blished institutions of the 1944 Bretton Woods System that are IMF,

cian at the World Bank. Rodan, recognized an “agrarian excess population” and pro-

cian at the World Bank. Rodan, recognized an “agrarian excess population” and pro-posed the transition of this excess labor from land to the industrial sector, which pro-posed the transition of this excess labor from land to the industrial sector, which pro-duceduces the products that are also demanded by themselves. While doing this, an initial s the products that are also demanded by themselves. While doing this, an initial phase, namely a big push, is seen essential for the provision of the targeted selfphase, namely a big push, is seen essential for the provision of the targeted self--sustained growth. Michelesustained growth. Michele Alacevich, “Early Development Economics Debates Revisit-Alacevich, “Early Development Economics Debates Revisit-eded,,” ” The WThe World Bank Archivesorld Bank Archives ((20072007): 3.): 3. Schumpeter created an awareness on this Schumpeter created an awareness on this problematic of development while he was working in Moldova and the economic mod-problematic of development while he was working in Moldova and the economic mod-els in his mind els in his mind wewere reshaped by this awareness. re reshaped by this awareness. Özveren (2018) Personal communi-Özveren (2018) Personal communi-cation.cation.

171 PaulPaul Krugman, “TKrugman, “The Fall and Rise of Development Economics”, he Fall and Rise of Development Economics”, web.mit.edu/Krugman/www/dishpon.html. Krugman refers to some prominent web.mit.edu/Krugman/www/dishpon.html. Krugman refers to some prominent names on the economic development debates that are Amartya Sen, Arthur Lewis, names on the economic development debates that are Amartya Sen, Arthur Lewis, Gunnar Myrdal, Paul RosensteinGunnar Myrdal, Paul Rosenstein--Rodan and Albert Hirschman.Rodan and Albert Hirschman.

172 BBerend, 308erend, 308, cited in, cited in Myrdal Myrdal ((19601960: : 3838).).

173 MeierMeier, “The Formative,” in , “The Formative,” in PioneersPioneers,, 55..

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WB; The United Nations in 1945, International Trade Organization, WB; The United Nations in 1945, International Trade Organization, General Agreement on Tariffs and Trade in 1947 appeared as the main General Agreement on Tariffs and Trade in 1947 appeared as the main actors in the prevailing circumstances. There were alsactors in the prevailing circumstances. There were also some important o some important local extensions of these institutions contributing to theoretical change. local extensions of these institutions contributing to theoretical change. For instance, ECLA, a regional commission of the United Nations found-For instance, ECLA, a regional commission of the United Nations found-ed in 1948 and based in Santiago Chile, came up with Raul Prebisch’s ed in 1948 and based in Santiago Chile, came up with Raul Prebisch’s thesis dealing with the futhesis dealing with the future developmental possibilities of the Latin ture developmental possibilities of the Latin American countries.American countries.174 The main economic agenda in the new world The main economic agenda in the new world order was now wheeling around the developmental possibilities and order was now wheeling around the developmental possibilities and policies enriched by the field research of the economists policies enriched by the field research of the economists inin various uni-various uni-versitiesversities and institutions.and institutions. Designed by the contributions Designed by the contributions ofof the prominent economists working the prominent economists working on developmental issues like Lewis, Schultz and Kaldor, the urgent on developmental issues like Lewis, Schultz and Kaldor, the urgent question in the UN report in 1951 was presented as “question in the UN report in 1951 was presented as “how to increase how to increase the rate of capital formationthe rate of capital formation..”” AnotAnother problem her problem wawas centered upon the s centered upon the ““existence of surplus laborexistence of surplus labor”” pointing out that “pointing out that “the population on land is the population on land is so great that the large numbers could be withdrawn from agriculture so great that the large numbers could be withdrawn from agriculture without any fall in agricultural output and with very little change in cap-without any fall in agricultural output and with very little change in cap-ital tital technologyechnology.”.”175 The vitalism of The vitalism of international actioninternational action to diminish the to diminish the vulnerability of the underdeveloped countries by stimulating the flow of vulnerability of the underdeveloped countries by stimulating the flow of capital in larger amounts capital in larger amounts wawas mentioned in another report.s mentioned in another report.176 There There was also an emphasis suggesting the governments in was also an emphasis suggesting the governments in the less developed the less developed countries to figure out their developmental problems via surveys on countries to figure out their developmental problems via surveys on their economy and preparation of development programs by establish-their economy and preparation of development programs by establish-ing a central economic unit. A development plan within a forced take off ing a central economic unit. A development plan within a forced take off was recommended for a swift imwas recommended for a swift implementation. Large amounts of public plementation. Large amounts of public

174 Meier, “The Formative,”Meier, “The Formative,” 1111--1212. . The proclamation of “structuralism” was also a The proclamation of “structuralism” was also a prominent part of ECLA’s works, which later transformed to the “dependency theory”prominent part of ECLA’s works, which later transformed to the “dependency theory”..

175 Ibid.Ibid.,, 13, cited in United Nations Department of Economic Affairs, 13, cited in United Nations Department of Economic Affairs, Measures for the Measures for the Economic Development of UnderEconomic Development of Under--Developed Countries Developed Countries (New York, 1951): 41. (New York, 1951): 41. If these If these people were employed in public works neither the total agricultural product nor their people were employed in public works neither the total agricultural product nor their consumptioconsumption levels would fall.n levels would fall.

176 Ibid.,Ibid., 1313..

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investment, premeditated levels of industrialization and foreign aid to investment, premeditated levels of industrialization and foreign aid to eliminate the resource gap were presented as the essential parts of such eliminate the resource gap were presented as the essential parts of such a development plan as well.a development plan as well.177 It should also be noted that during the postIt should also be noted that during the post war period, the Western war period, the Western developed countries themselves hadeveloped countries themselves haveve also made amendments in eco-also made amendments in eco-nomic policies for their own countries. The policy prescriptions of nomic policies for their own countries. The policy prescriptions of Keynes related with boosting the demand and ensuring full employ-Keynes related with boosting the demand and ensuring full employ-ment were much more popular after Wment were much more popular after Woorld rld WWar ar II than the year II than the year TThe he General TheoryGeneral Theory was first published. The welfare state was on the agenda was first published. The welfare state was on the agenda and the gap between the poor and the rich was intended to be nar-and the gap between the poor and the rich was intended to be nar-rowed. Unemployment was nearly eliminated and responsibilities of rowed. Unemployment was nearly eliminated and responsibilities of state for citizens increastate for citizens increased. sed. Although we should keep in mind that the type of unemployment in Although we should keep in mind that the type of unemployment in the less developed countries is structurally different from the Western the less developed countries is structurally different from the Western world, one can’t deny the strong influence of Keynesian analysis on de-world, one can’t deny the strong influence of Keynesian analysis on de-velopment economics. At least, by posing a velopment economics. At least, by posing a challenge against orthodox challenge against orthodox economics, he became a prominent figure in approaching the economic economics, he became a prominent figure in approaching the economic problems via alternative ways.problems via alternative ways.178 It is acknowledged that the strong It is acknowledged that the strong emphasis on capital accumulation, industrialization and planning can all emphasis on capital accumulation, industrialization and planning can all be traced back to Keybe traced back to Keynesian tradition.nesian tradition.179

§ 6.2 Theories onTheories on Development EconomicsDevelopment Economics

The task of economic development posed a challenge against the exist-The task of economic development posed a challenge against the exist-ing understanding and revitalized the field of economic history within ing understanding and revitalized the field of economic history within its own perspective and frame.its own perspective and frame.180 As the empirical framework inAs the empirical framework in the the postwar period that gave rise to the emergence of a fresh thinking about postwar period that gave rise to the emergence of a fresh thinking about

177 Meier,Meier, “The Formative,” “The Formative,” 1818..

178 Meier,Meier, “The Formative,” “The Formative,” 1414..

179 IbIbid., id., 1515..

180 IbIbid., id., 1919..

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the current atmosphere, various conceptualizations came into the pic-the current atmosphere, various conceptualizations came into the pic-ture about the developmental means. New principles were deduced and ture about the developmental means. New principles were deduced and new models were built. new models were built. There There iis no one sins no one single development theory, as gle development theory, as the frame of a theory the frame of a theory iis specified by the viewpoint of the subject accord-s specified by the viewpoint of the subject accord-ing to his/her ideological stance in addition to the concrete current ing to his/her ideological stance in addition to the concrete current conditions around the object of analysis. So, while considering the al-conditions around the object of analysis. So, while considering the al-ternatives for dternatives for development possibilities, evelopment possibilities, oneone should examine various should examine various approaches that have come to the forefront via different schools of approaches that have come to the forefront via different schools of thought.thought.181 To locate the different interpretations on the issue and To locate the different interpretations on the issue and structuring the forthcoming material in a clear framework, Susan En-structuring the forthcoming material in a clear framework, Susan En-ggel’s article “Development Economics: From Classical to Critical Analy-el’s article “Development Economics: From Classical to Critical Analy-sis” provides a useful guideline.sis” provides a useful guideline.182

The essence of a viewpoint makes itself evident particularly in be-

The essence of a viewpoint makes itself evident particularly in be-tween the various meanings attached to the concept of development. tween the various meanings attached to the concept of development. What reveals the diWhat reveals the difference in each school of thought’s perspective is fference in each school of thought’s perspective is their prior emphasis among these themes. The classical definition of their prior emphasis among these themes. The classical definition of development as “a process of capital formation which is the product of development as “a process of capital formation which is the product of levels of investment and saving” refers to some key concepts liklevels of investment and saving” refers to some key concepts like e growth, national income, welfare and GDP per capita, which can be con-growth, national income, welfare and GDP per capita, which can be con-sidered as constitutive elements of development. Engel suggests that if sidered as constitutive elements of development. Engel suggests that if GDP is primarily considered, the factors of production that are capital, GDP is primarily considered, the factors of production that are capital,

181 The existence of different schools of thought in economics is disapproved by Joseph The existence of different schools of thought in economics is disapproved by Joseph Schumpeter.Schumpeter. IIn a farewell n a farewell he he addressaddresseded to hito his students at Bonn and declared: “I have s students at Bonn and declared: “I have never tried to bring about a Schumpeter school. There is none and it ought not to ex-never tried to bring about a Schumpeter school. There is none and it ought not to ex-ist… Economics is not a philosophy but a science. Hence there should be no ‘schools’ in ist… Economics is not a philosophy but a science. Hence there should be no ‘schools’ in our field.” our field.” Thomas K. McCrow, “Schumpeter AThomas K. McCrow, “Schumpeter Ascending,” scending,” The American Scholar The American Scholar 60, no. 3 60, no. 3 (1991): 380. (1991): 380. Schumpeter, a constituent figure in the emergence of development eco-Schumpeter, a constituent figure in the emergence of development eco-nomics argues against existence of different school of thoughts in the sense that for nomics argues against existence of different school of thoughts in the sense that for him economics him economics iis not a philosophy, but s not a philosophy, but a a sciencscience.e.

182 Susan Engel, “Susan Engel, “Development Economics: From Classical to Critical AnalysisDevelopment Economics: From Classical to Critical Analysis,,”” ((20102010): ): 874874--892. https://ro.uow.wsu.ay/artspapers/1084. 892. https://ro.uow.wsu.ay/artspapers/1084. Engel’s method is useful in the Engel’s method is useful in the sense that she tries to make connections between theory and practice and highlights sense that she tries to make connections between theory and practice and highlights thethe way in which the critiques of current traditionsway in which the critiques of current traditions and new ideas were central to the and new ideas were central to the discoursediscoursess of development economics.of development economics.

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labor, land

labor, land,, and the concept of growth oand the concept of growth occur as the first priorities; it ccur as the first priorities; it means to be positioned around the classical and neoclassical theories. means to be positioned around the classical and neoclassical theories. On the other hand, if the issue is approached in a more critical manner On the other hand, if the issue is approached in a more critical manner and the concepts like welfare, improvement and national income are of and the concepts like welfare, improvement and national income are of first priofirst priorities; it means to be closer to Marxist and neorities; it means to be closer to Marxist and neo--Marxist ap-Marxist ap-proaches.proaches.183

Although Engel provides us a guideline to ideologically locate the

Although Engel provides us a guideline to ideologically locate the approaches on development economics ofapproaches on development economics of thethe predominant schoolpredominant schoolss of of thoughtthoughtss; development economics presents itself with ; development economics presents itself with a “fresh thinking” a “fresh thinking” as it was previously mentioned. Economists from European countries as it was previously mentioned. Economists from European countries and United States were visiting the developing countries and witnessing and United States were visiting the developing countries and witnessing the developmental problems on site in Asia and Latin America. The new the developmental problems on site in Asia and Latin America. The new theories were constructed uptheories were constructed upon these experienceon these experiencess and observations, and observations, which can be featured as challenges to the assumptions of the existing which can be featured as challenges to the assumptions of the existing theories in various manners.theories in various manners.

As I was walking down a road in Bangkok one morning in August

As I was walking down a road in Bangkok one morning in August 1952, it suddenly occurred to me that all one needed to1952, it suddenly occurred to me that all one needed to do was to do was to drop the assumption drop the assumption –– then usually (but not necessarily) made then usually (but not necessarily) made by neoclassical macroeconomistsby neoclassical macroeconomists –– that the supply of labor was that the supply of labor was fixed. Assume instead that it was infinitely elastic, add that fixed. Assume instead that it was infinitely elastic, add that productivity was increasing in the capitalist sector, andproductivity was increasing in the capitalist sector, and one got a one got a rising profits share. It also occurred to me that this model would rising profits share. It also occurred to me that this model would solve another problem that had bothered me since undergradu-solve another problem that had bothered me since undergradu-

183 Susan Engel, “Development EconomicsSusan Engel, “Development Economics,,” 1. In the article, the question is formulated ” 1. In the article, the question is formulated around the investigation on the source of economaround the investigation on the source of economic growth and the answers of the ic growth and the answers of the classical, neoclassical and Keynesian school are examined. To start with the classical classical, neoclassical and Keynesian school are examined. To start with the classical theory, production side and supply costs come forefront. The basic constituent con-theory, production side and supply costs come forefront. The basic constituent con-cepts are presented as cepts are presented as ““capital accumulation, producticapital accumulation, production, technological on, technological advancementadvancement, , division of labor and population growthdivision of labor and population growth.”.” Neoclassicals on the contrary, are more pre-Neoclassicals on the contrary, are more pre-occupied with the consumption side. It is much more individualistic as it is clearly occupied with the consumption side. It is much more individualistic as it is clearly seen in the theory of Walrasian General Equilibrium, whseen in the theory of Walrasian General Equilibrium, which is considered as the sum of ich is considered as the sum of individual equilibriumsindividual equilibriums. . Keynesians, on the other hand regard the issue differently by Keynesians, on the other hand regard the issue differently by challenging the assumptions of general equilibrium as they were primarily concerned challenging the assumptions of general equilibrium as they were primarily concerned with full employment and effective demand side. Engelwith full employment and effective demand side. Engel, 3, 3--4.4.

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ate days: what determined the relative prices of steel and coffee?

ate days: what determined the relative prices of steel and coffee? I had been taught that marginal utility was the answI had been taught that marginal utility was the answer to this er to this question, but this answer made no sense to me. If, however, one question, but this answer made no sense to me. If, however, one assumed an infinite elasticity of labor in terms of food to the cof-assumed an infinite elasticity of labor in terms of food to the cof-fee industry, and an infinite elasticity also in terms of food to the fee industry, and an infinite elasticity also in terms of food to the steel industry, then the factoral terms of tsteel industry, then the factoral terms of trade between steel and rade between steel and coffee were fixed, and marginal utility was out the window.coffee were fixed, and marginal utility was out the window.184

These words belong to the Nobel

These words belong to the Nobel llauraureeate economist Arthur Lewis, a ate economist Arthur Lewis, a prproominent figure among the development theorists.minent figure among the development theorists.185 At the core of his At the core of his theory of development, there theory of development, there areare ththe optimal distribution of productive e optimal distribution of productive sources and investigation of the ways to increase savings. Emphasizing sources and investigation of the ways to increase savings. Emphasizing the existence of disguised employment in agricultural sector, he sug-the existence of disguised employment in agricultural sector, he sug-gested a transfer of the labor to the modern sector with the aim of ex-gested a transfer of the labor to the modern sector with the aim of ex-panding topanding total product.tal product.186 ReReferring to Ragnar Nurkse, he mentions the ferring to Ragnar Nurkse, he mentions the utilization of the surplus labor for capital formation.utilization of the surplus labor for capital formation.187

184 Sir Sir Arthur LewisArthur Lewis, “Development Economics in the 1950s,” , “Development Economics in the 1950s,” in in PioneersPioneers, , 132132..

185 Sir Sir Arthur Lewis, a graduate and later a lecturer at the London School of Economics, Arthur Lewis, a graduate and later a lecturer at the London School of Economics, began to study on development economics more systematically at the University of began to study on development economics more systematically at the University of ManManchester as a professor. His research covered the history of the world economy chester as a professor. His research covered the history of the world economy since 1870. since 1870. PioneersPioneers, 119, 119.. He workHe workeded to figure out the appropriate size of the industri-to figure out the appropriate size of the industri-al sector and how modernization can be financed. He suggestal sector and how modernization can be financed. He suggesteded three strategies that three strategies that are expare exporting more agricultural commodities, developing a selforting more agricultural commodities, developing a self--sufficient economy sufficient economy and exporting manufactures. and exporting manufactures. Pioneers,Pioneers, 121121.. It is already known that there have been It is already known that there have been counter arguments based on the terms of trade and dependency theories for the first counter arguments based on the terms of trade and dependency theories for the first strategy. As strategy. As for the foreign aid, he asks “why did for the foreign aid, he asks “why did less developed countries (less developed countries (LDCsLDCs)) need need foreign aid when the countries now developed had not needed it?foreign aid when the countries now developed had not needed it?”” PPotential answers otential answers were set forth as the people in the developed countries may be forced to save less than were set forth as the people in the developed countries may be forced to save less than they wouldthey would like to and developing countries now are urbanizing faster, even more than like to and developing countries now are urbanizing faster, even more than twice, with respect totwice, with respect to thethe Western Europe during 1900s, which is definitely an expen-Western Europe during 1900s, which is definitely an expen-sive process. The population explosion sive process. The population explosion wawas s portrayed portrayed another reason for the need of another reason for the need of higher inveshigher investment rates. Ibtment rates. Ibiid.d.,, 134134--136136..

186 Engel, “Development Economics,” 6. Engel, “Development Economics,” 6. This theory assumes all the profit is reinvested. This theory assumes all the profit is reinvested. Engel asserts that this model is not confirmed by the experience of developing coun-Engel asserts that this model is not confirmed by the experience of developing coun-tries and tries and since it since it can be characterized as a derivative can be characterized as a derivative of the experience of Western of the experience of Western Europe, there are some doubts on the applicability to other countries. Engel also finds Europe, there are some doubts on the applicability to other countries. Engel also finds

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Being a cornerstone figure of development economics, what the Es-

Being a cornerstone figure of development economics, what the Es-tonian economist Ragnar Nurkse mainly claims is that poverty is like a tonian economist Ragnar Nurkse mainly claims is that poverty is like a ““viciovicious circleus circle””.. The low real income, low productivity, lack of capital The low real income, low productivity, lack of capital and low saving ratios are the rings of the chain. and low saving ratios are the rings of the chain. He agrees on the fact He agrees on the fact that profitability increases in direct proportion to investment, but the that profitability increases in direct proportion to investment, but the problem is about the size of the markets in problem is about the size of the markets in the developing countries the developing countries which are generally too small to attract investments that help them which are generally too small to attract investments that help them break the vicious circle in supply side. As the saving capacity is limited break the vicious circle in supply side. As the saving capacity is limited due to the lowdue to the low--income level, the productivity is also limited. Hence for income level, the productivity is also limited. Hence for him, in the abshim, in the absence of a “big push”, a developing country ence of a “big push”, a developing country mightmight be stuck be stuck in a poverty trap.in a poverty trap.188

Here we should make a note of that Lewis and Nurkse are among the

Here we should make a note of that Lewis and Nurkse are among the most referred development theoristmost referred development theoristss in thein the universityuniversity journals. The journals. The themes theythemes they hadhad put forth were very central put forth were very central in understanding common in understanding common patterns in many developing countries and their observations present-patterns in many developing countries and their observations present-ed an effective data to generate feasible solution offers. ed an effective data to generate feasible solution offers. On the other On the other hand,hand, generalization of the outcomes is again risky and the core issue generalization of the outcomes is again risky and the core issue here is not to treat here is not to treat the concepts and patterns in an essentialist manner. the concepts and patterns in an essentialist manner. One should not forget that the disparities between the existing concepts One should not forget that the disparities between the existing concepts and literature in and literature in the the developed and developing world wdeveloped and developing world wereere also matteralso matterss of debate. Employing the accustomed terminology in examininof debate. Employing the accustomed terminology in examining the pe-g the pe-culiarities in the developing countries prevents discerning the reality culiarities in the developing countries prevents discerning the reality there. As Gunnar Myrdal suggests:there. As Gunnar Myrdal suggests:

Institutional research could not rely on the concepts used in or-nstitutional research could not rely on the concepts used in or-dinary economic literature and borrowed from studies of devel-dinary economic literature and borrowed from studies of devel-op countries: sucop countries: such concepts as income, savings, supply, demand, h concepts as income, savings, supply, demand, and prices, all within markets and all in aggregate or average and prices, all within markets and all in aggregate or average terms. These concepts were seldom adequate to deal with reality terms. These concepts were seldom adequate to deal with reality

important to mention that the productive capacity and potential contribution of the

important to mention that the productive capacity and potential contribution of the agricultural sector is underestimated in this theory. Eagricultural sector is underestimated in this theory. Engel, “Development Economicsngel, “Development Economics,,” ” 6.6.

187 Lewis, “Development Economics in the 1950s,” in Lewis, “Development Economics in the 1950s,” in Pioneers, Pioneers, 134.134.

188 Engel, “Development EconomicsEngel, “Development Economics,,” 6.” 6.

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in underdeveloped countries. The widely used concepts of un-

in underdeveloped countries. The widely used concepts of un-employment and underempemployment and underemployment, for instance, have in the loyment, for instance, have in the underdeveloped countries no precise meaning, except for nar-underdeveloped countries no precise meaning, except for nar-row sections and even there only with reservations. Without a row sections and even there only with reservations. Without a developed labor market in which the workers are split up ac-developed labor market in which the workers are split up ac-cording to occupation, have knowledge abocording to occupation, have knowledge about a market, and are ut a market, and are actively seeking employment, the larger part of the actual "work-actively seeking employment, the larger part of the actual "work-lessness" of people cannot be categorized in these terms.lessness" of people cannot be categorized in these terms.189

Apart from the structural differences, Rosenstein Rodan attracts atten-

Apart from the structural differences, Rosenstein Rodan attracts atten-tion to the dynamism of wants, which tion to the dynamism of wants, which showsshows diversitiesdiversities in developing in developing countries by saying thatcountries by saying that,,

The seeds of my development analysis had been planted earlier

The seeds of my development analysis had been planted earlier when I became interested in the themes of complementarity and when I became interested in the themes of complementarity and of the hierarchical structure of wants, together with the role of of the hierarchical structure of wants, together with the role of timetime--that is,that is, the choice of an economic period over which an in-the choice of an economic period over which an in-dividual allocates his scarce resources. The dynamics of wants dividual allocates his scarce resources. The dynamics of wants and their interrelatedness were much more important to me and their interrelatedness were much more important to me than the neoclassical attempt at precise characterization of the than the neoclassical attempt at precise characterization of the properties of the utproperties of the utility function. Consumption complementari-ility function. Consumption complementari-ties, the role of time, the pursuit curve, plus external economiesties, the role of time, the pursuit curve, plus external economies--all these dynamic factors were not to be considered as a second all these dynamic factors were not to be considered as a second order of smalls, but even more as pervasive in a less developed order of smalls, but even more as pervasive in a less developed country.country.190 In additioIn addition to n to the the distinctions in mindset, one should also theorize a distinctions in mindset, one should also theorize a very different layout in the less developed countries since market very different layout in the less developed countries since market mechanism is mechanism is not not obviously able to generate maximum welfare. It is obviously able to generate maximum welfare. It is also insufficient in provision of the optimal distribution ofalso insufficient in provision of the optimal distribution of the produc-the produc-

189 Gunnar Myrdal,Gunnar Myrdal, “International Inequality and Foreign Aid in Retrospect,”“International Inequality and Foreign Aid in Retrospect,” in in Pioneers,Pioneers, 155155..

190 Rosenstein Rodan,Rosenstein Rodan, “Natura Facit Saltum: Analysis of the Disequilibrium Growth “Natura Facit Saltum: Analysis of the Disequilibrium Growth Process,”Process,” inin PioneerPioneers, 210s, 210..

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tive sources. The distribution of investments is portrayed as a dynamic tive sources. The distribution of investments is portrayed as a dynamic problem.problem. Similar with Similar with Tinbergen, Lewis and NurksTinbergen, Lewis and Nurkse; e; Rosenstein Rodan Rosenstein Rodan insistently emphasizes that the investments should be planned in con-insistently emphasizes that the investments should be planned in con-junction with each other. Only when ijunction with each other. Only when it is done, the individual profitabil-t is done, the individual profitabil-ity of an investment can be an indicator of the social benefit.ity of an investment can be an indicator of the social benefit.191 The de-The de-viations from the neoclassical viewpoint make its presence felt in such viations from the neoclassical viewpoint make its presence felt in such discourses, both in theoretical and practical terms.discourses, both in theoretical and practical terms.

When we disengage from t

When we disengage from the neoclassical approach even more, we he neoclassical approach even more, we encounter with the representative agents of the Marxist and neoencounter with the representative agents of the Marxist and neo--Marxist approaches, Raul Prebisch, Paul Baran and Paul Sweezy. In their Marxist approaches, Raul Prebisch, Paul Baran and Paul Sweezy. In their attempt to construct a more holistic analysis, the uniqueness of theattempt to construct a more holistic analysis, the uniqueness of the de-de-velopmentvelopment path is challenged. Instead of a total averseness against the path is challenged. Instead of a total averseness against the market, the need for a structural change was emphasized in the words market, the need for a structural change was emphasized in the words of Prebisch who ironically was firm believer of neoclassical thought till of Prebisch who ironically was firm believer of neoclassical thought till the crisis: the crisis: ““What really matters is the structure bWhat really matters is the structure behind the market and ehind the market and the arbitrary play of power relations. Let us change the structures, pre-the arbitrary play of power relations. Let us change the structures, pre-serve the market, and respect income disparities emerging from differ-serve the market, and respect income disparities emerging from differ-ent individual contributions to the productive processent individual contributions to the productive process..””192 He considers He considers the the persistenpersistence of the ce of the centers on reciprocal relations in trade conces-centers on reciprocal relations in trade conces-sions as sions as destructivedestructive to the peripheryto the periphery andand stands against the interna-stands against the interna-tional division of labor.tional division of labor.193 Keeping the centerKeeping the center--periphery terminology of periphery terminology of RaRauul Prebisch in mind, Hans Singer alleges that the terms of trade movl Prebisch in mind, Hans Singer alleges that the terms of trade move e against the countries producing primary products. The Singeragainst the countries producing primary products. The Singer--Prebisch Prebisch thesis was based on the idea that the price of primary goods declines thesis was based on the idea that the price of primary goods declines more thamore thann the manufactured goods in the long run. As an admirer of the manufactured goods in the long run. As an admirer of William Beveridge, William Beveridge, a a student of Schumpeter and student of Schumpeter and KeynesKeynes194, he challeng-, he challeng-es the assumption that “economics consistes the assumption that “economics consistss a body of universal truth a body of universal truth

191 Kazgan, Kazgan, İktisadi Düşünce,İktisadi Düşünce, 269269..

192 Raul Prebisch,Raul Prebisch, “Five Stages in My Thinking of Development,” in “Five Stages in My Thinking of Development,” in Pioneers,Pioneers, 189189..

193 Ibid.Ibid., , 179179--180.180.

194 Hans Hans Singer,Singer, “The Terms of Trade Controversy and the Evolution of Soft Financing: “The Terms of Trade Controversy and the Evolution of Soft Financing: Early Years in the U.N.,” in Early Years in the U.N.,” in Pioneers,Pioneers, 273273..

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applicable to all countries in all conditions.”

applicable to all countries in all conditions.”195 His words His words ““While main-While main-stream economics concentrated on the problem of allocative efficiency stream economics concentrated on the problem of allocative efficiency (where comparative advantag(where comparative advantages ruled supreme), my interest was from es ruled supreme), my interest was from the beginning more in the direction of distributive justice, or rather dis-the beginning more in the direction of distributive justice, or rather dis-tributive efficiency”tributive efficiency”196 reflect the prior emphasis of his approach.reflect the prior emphasis of his approach.

Paul Baran attracts the attention to the distinction in the functionali-

Paul Baran attracts the attention to the distinction in the functionali-ty oty of the capitalism in between the developed and developing world. He f the capitalism in between the developed and developing world. He claims that although the cyclical capitalist crises in Europe was claims that although the cyclical capitalist crises in Europe was deferredeferred d by the imperial system, capitalism by the imperial system, capitalism performsperforms differently in the third differently in the third world countries. In the first world, growth iworld countries. In the first world, growth iss generatedgenerated by the reinvest-by the reinvest-ment of the surplus; however, in the third world, surplus is being trans-ment of the surplus; however, in the third world, surplus is being trans-ferred to the first worldferred to the first world at the endat the end, which leave, which leavess no room to accumulate no room to accumulate capital and implement development, but subjugatecapital and implement development, but subjugatess them to rely on them to rely on for-for-eigneign investmentinvestment for development.for development.197 WWho benefitho benefitss from this process from this process is is portrayed as theportrayed as the collaboration of thecollaboration of the Westernizing elites in developing Westernizing elites in developing countries and traditional landed elitescountries and traditional landed elites,, for whom for whom procuring procuring investment investment become a secondary goal behind the tendencies to enrich thembecome a secondary goal behind the tendencies to enrich themselves.selves.198 For Sweezy and Baran, world economics is dominated by the multina-For Sweezy and Baran, world economics is dominated by the multina-tional corporations that exploit the resources of the third world. This tional corporations that exploit the resources of the third world. This can be defined as a theory of “dependent capitalism”.can be defined as a theory of “dependent capitalism”.199

Among allmong all these influentialthese influential theories, theories, which ones which ones primarprimarilyily ccaame to me to the forefront in conceptualizationthe forefront in conceptualizationss of of the the developmentdevelopmental agendaal agenda in Tur-in Tur-key will be the main concernkey will be the main concernss in the following sections. While doing in the following sections. While doing this, this, oneone should always keep in mind that the meanings attributed to should always keep in mind that the meanings attributed to some concepts are not universal. Insome concepts are not universal. In thisthis search, search, II will seek for the clues will seek for the clues about about the implicit viewpointsthe implicit viewpoints. F. For instance, or instance, examining on examining on the contem-the contem-plations plations regardingregarding the economic relations between the developed and the economic relations between the developed and developing countries would developing countries would provideprovide insightsinsights about the stance of aca-about the stance of aca-

195 IIbid.,bid., 277277..

196 Ibid., 280.Ibid., 280.

197 Engel, “Development EconomicsEngel, “Development Economics,,” 9. ” 9.

198 Ibid., 9.Ibid., 9.

199 Ibid., 9.Ibid., 9.

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demics

demics visvis--àà--vvisis the centerthe center--periphery approach/dependency school. The periphery approach/dependency school. The ultimate goals in development and the presentation of the circumstance ultimate goals in development and the presentation of the circumstance at the starting point would draw a peculiar route in between. The fea-at the starting point would draw a peculiar route in between. The fea-tures of that starting point would explicate how and why thitures of that starting point would explicate how and why this route de-s route de-viateviatedd from other countries. So, from other countries. So, it would be meaningful toit would be meaningful to begin with a begin with a brief developmental history of Turkey which provides a solid back-brief developmental history of Turkey which provides a solid back-ground for all these contemplationsground for all these contemplations..

§ 6.3 The Developmental History of TurkeyThe Developmental History of Turkey

Since the very beginning of th

Since the very beginning of the e RRepublican regime, epublican regime, there appeared there appeared many respectsmany respects thatthat might be related with developmental themes. might be related with developmental themes. In fact, In fact, tthe concept of “national development” he concept of “national development” has already been has already been on the agendaon the agenda sincesince the Second Constitutional Era 1908. Adopting the German model, the Second Constitutional Era 1908. Adopting the German model, it it wawas emps emphasized that to construct a national economy that would car-hasized that to construct a national economy that would car-ry out the economic growth, it is essential to create a national industry ry out the economic growth, it is essential to create a national industry and bourgeoisie. and bourgeoisie. TThe continuity on the goal of national development he continuity on the goal of national development can can be traced be traced at Izmir Economic Congress assembled in Fat Izmir Economic Congress assembled in February 1923ebruary 1923 as as wellwell, even before the proclamation of the , even before the proclamation of the RRepublic. The epublic. The RRepublicans epublicans were giving a very clear message about how they care about the eco-were giving a very clear message about how they care about the eco-nomic independencenomic independence, as , as political independence waspolitical independence was simultaneouslysimultaneously accompanied by an indaccompanied by an indiispensable economic spensable economic independenceindependence both in dis-both in dis-cursive and practical mannerscursive and practical manners. . For that purpose,For that purpose, the infrastructural in-the infrastructural in-vestments were at the core of industrializationvestments were at the core of industrialization the early years of the the early years of the RRepublicepublic; ; an an economic, cultural and political integration was aimed as economic, cultural and political integration was aimed as the railroads interthe railroads intertwined the country. The railroads and transportation twined the country. The railroads and transportation

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were

were urgentlyurgently nationalized and foreign investment was welcomed un-nationalized and foreign investment was welcomed un-less it harms the economic independence.less it harms the economic independence.200

As the main goal was to provide

As the main goal was to provide selfself--sufficiencysufficiency inin thethe economyeconomy,, a a rapid investment was devoted rapid investment was devoted to the industrial sector. In line with theto the industrial sector. In line with the tasktask of creation of a national bourgeoisie, state supported the private of creation of a national bourgeoisie, state supported the private sector particularly via the 1927 Industrial Promotion Law.sector particularly via the 1927 Industrial Promotion Law.201 The im-The im-pacts of the policies made themselves evident in economic indicators. pacts of the policies made themselves evident in economic indicators. SSinceince from the early years till the 1929 Great Depression, the GDP was from the early years till the 1929 Great Depression, the GDP was almost doubled, reaching 1 billion dollars and the growth ratio was almost doubled, reaching 1 billion dollars and the growth ratio was 9,4.9,4.202 Despite the industrialization efforts to be a selfDespite the industrialization efforts to be a self--sufficient country sufficient country and the important share of the industrial sectand the important share of the industrial sector in growth, the role of or in growth, the role of agriculture was still at the center of the economic activity. The agriculture was still at the center of the economic activity. The RRepubli-epubli-cans were aware of this reality and worked for revival of agriculturecans were aware of this reality and worked for revival of agriculture as as wellwell. Tithe, a tax over the agricultural product which dates back to the . Tithe, a tax over the agricultural product which dates back to the Ottoman EmpOttoman Empireire,, was abolished in 1925, was abolished in 1925, broughtbrought about a relief for the about a relief for the agricultural sectoragricultural sector. This attempt probably. This attempt probably increased the production lev-increased the production lev-els, demand and consumption of the rural areas. els, demand and consumption of the rural areas.

The period from 1923 to 1929 can be defined as a reconstruction

The period from 1923 to 1929 can be defined as a reconstruction process in opprocess in open economy conditionsen economy conditions203 as the tariffs were fixed to their as the tariffs were fixed to their levellevelss in 191in 19166 and the right to determine the tariff rates was not in and the right to determine the tariff rates was not in RRe-e-public’s power till 1929 as it is mentioned in the Treaty of Lausanne. public’s power till 1929 as it is mentioned in the Treaty of Lausanne. Together with being freed from this sanction, the 1929 Together with being freed from this sanction, the 1929 Great Depres-Great Depres-sion led to a strict policy shift from a liberal order to sion led to a strict policy shift from a liberal order to éétatism. First pro-tatism. First pro-tectionism, then tectionism, then éétatism was settled as the dominant economic policy tatism was settled as the dominant economic policy till the 1950s. As might be expected, the primary concern occurred as till the 1950s. As might be expected, the primary concern occurred as

200 The nationalization decisions were taken during the congress, and most of the The nationalization decisions were taken during the congress, and most of the nationalizations of railroads were made during the 1930snationalizations of railroads were made during the 1930s. For further information se. For further information see e Şevket Şevket Pamuk Pamuk Türkiye’nin 200 Yıllık İktisadi TarihiTürkiye’nin 200 Yıllık İktisadi Tarihi (İstanbul: Türkiye İş Bankası Kültür (İstanbul: Türkiye İş Bankası Kültür YayınlarıYayınları, , 20142014))

201 Korkut Korkut Boratav, Boratav, ““Kemalist İktisat Politikaları ve DevletçilikKemalist İktisat Politikaları ve Devletçilik,,”” in in Emperyalizm, Sosyalizm Emperyalizm, Sosyalizm ve ve Türkiye Türkiye (İstanbul: Yordam Kitap, 2010), (İstanbul: Yordam Kitap, 2010), 357357.. HoweverHowever, considering the existing , considering the existing material resources, one can see the limits of industrialization for the current era.material resources, one can see the limits of industrialization for the current era.

202 MahfiMahfi Eğilmez, Eğilmez, Değişim Sürecinde Değişim Sürecinde Türkiye, Türkiye, 138138..

203 This naming was coined by Korkut Boratav in his book This naming was coined by Korkut Boratav in his book Türkiye İktisat Tarihi.Türkiye İktisat Tarihi.

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self

self--sufficiency sufficiency when we thinwhen we think of the k of the influential influential memoirs of the memoirs of the RRepub-epub-licans about the recent past. To ensure the permanence of a strong in-licans about the recent past. To ensure the permanence of a strong in-dependent economy, fiscal and monetary policy measures were adapted dependent economy, fiscal and monetary policy measures were adapted to the current conditions. to the current conditions. For instance, For instance, The Central Bank was founded The Central Bank was founded in 1930 in 1930 for carrying out the monetary policy and control the inflation. for carrying out the monetary policy and control the inflation. In 1934, the first In 1934, the first FiveFive Year Development Plan borrowed from the Sovi-Year Development Plan borrowed from the Sovi-ets was put into practice. Based on the contents of this plan, industrial ets was put into practice. Based on the contents of this plan, industrial institutions on textile, extractive, paper, chemisinstitutions on textile, extractive, paper, chemistry and soil wtry and soil wereere found-found-ed. In brief, the economic policies adopted on the way of development ed. In brief, the economic policies adopted on the way of development can be regarded as reflectican be regarded as reflectioonnss of pragmatismof pragmatism andand oscillationoscillationss between between the liberal and statist tendencies.the liberal and statist tendencies.

The Second World War was an interruption for

The Second World War was an interruption for thethe industriindustrializationalization processprocess indeedindeed,, asas most of the resources were dedicated for the armymost of the resources were dedicated for the army during that timeduring that time. This period can be . This period can be described adescribed as a rupture from the s a rupture from the ongoing industrialization ongoing industrialization process as the developmental themes were process as the developmental themes were compulsorily compulsorily laid aside due to conjuncturlaid aside due to conjunctural conditions. After theal conditions. After the end of end of thethe warwar,, Turkey was positioned on behalf of the liberal democracies and Turkey was positioned on behalf of the liberal democracies and became a member of IMF and World Bank.became a member of IMF and World Bank.204 Economic policies have Economic policies have also undergone a change since then.also undergone a change since then.205 In between the years 1950 and In between the years 1950 and 1960, economic develop1960, economic development was based on the exports of agricultural ment was based on the exports of agricultural products and infrastructural investments. Liberal economic policies products and infrastructural investments. Liberal economic policies were revisited but in a different manner. The role of the agricultural sec-were revisited but in a different manner. The role of the agricultural sec-

204 As we look As we look up some economic indicators for the current time, we see that the GDP in up some economic indicators for the current time, we see that the GDP in 1949 get up to 3.2 billion dollars and the average growth rate was around 2.6 1949 get up to 3.2 billion dollars and the average growth rate was around 2.6 percentpercent. . Turkish economy in this period, was experienced economic shrinkage for 7 times and Turkish economy in this period, was experienced economic shrinkage for 7 times and growth for 3 growth for 3 times. These growth rates were as high as 15.8, 23.3 and 31.9 times. These growth rates were as high as 15.8, 23.3 and 31.9 percentpercent. . The economy had a surplus on foreign trade. The average inflation rate between 1939 The economy had a surplus on foreign trade. The average inflation rate between 1939 and 1949 was around 25.3 and 1949 was around 25.3 percentpercent. Eğilmez, . Eğilmez, Değişim SürecindeDeğişim Sürecinde, , 139139--140140..

205 Although the early years of the Although the early years of the RRepublic the “köylüyü köyünde tutma” policy was epublic the “köylüyü köyünde tutma” policy was adopted, since the 1950s the rural urban migration began to be increased and accord-adopted, since the 1950s the rural urban migration began to be increased and accord-ing to Pamuk, more than one third of the per capitaing to Pamuk, more than one third of the per capita income in between the years 1950 income in between the years 1950 and 1980, was provided by the transition of the labor from agricultural sector (low and 1980, was provided by the transition of the labor from agricultural sector (low productivity) to urban economies (high productivity)productivity) to urban economies (high productivity).. PamukPamuk, , Türkiye’nin 200 Yıllık, Türkiye’nin 200 Yıllık, 256256..

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tor was boosted with the help of the mechanization of agriculture, i

tor was boosted with the help of the mechanization of agriculture, in-n-centive credits and subsidies. The money supply was expanded to create centive credits and subsidies. The money supply was expanded to create fundfundss for these subsidies and infrastructural investments. The provision for these subsidies and infrastructural investments. The provision of foreign aid, namely Marshall Aid was also utilized mostly for devel-of foreign aid, namely Marshall Aid was also utilized mostly for devel-opmental aims. The average growth rate waopmental aims. The average growth rate was 7 s 7 percentpercent and and the the average average annual inflation rate was 8.8 annual inflation rate was 8.8 percentpercent. Yet, problems began to be . Yet, problems began to be occur occur especially in the second half of the decade. Due to the lack of prudence especially in the second half of the decade. Due to the lack of prudence in allocation of resources, industrialists argued against the policiesin allocation of resources, industrialists argued against the policies preferences opreferences of the policymakers.f the policymakers. Finding foreign aid became difficult Finding foreign aid became difficult and investments were left half finished. and investments were left half finished. Even OECD and IMF were per-Even OECD and IMF were per-severingly emphasizing the need for an economic plan.severingly emphasizing the need for an economic plan.206 From the From the 1960s on, for the purpose of eliminating the problems generated by t1960s on, for the purpose of eliminating the problems generated by the he planlessness, State Planning Organization was foundedplanlessness, State Planning Organization was founded207 and till the and till the late 1970s, import substitution industrialization was implementedlate 1970s, import substitution industrialization was implemented208, ,

206 VedatVedat MilorMilor,, Devleti Geri GetirmekDevleti Geri Getirmek (İstanb(İstanbul: İletişim Yayınları, 2022), 166. Milor claims ul: İletişim Yayınları, 2022), 166. Milor claims that this might the very first situation these international institutions were advocating that this might the very first situation these international institutions were advocating for a plan to a “liberal” third world government. for a plan to a “liberal” third world government.

207 It is important to note that the State Planning Organization waIt is important to note that the State Planning Organization was supported by OECD s supported by OECD and for that matter, Dutch economist Jan Tinbergen was brought as an advisor for and for that matter, Dutch economist Jan Tinbergen was brought as an advisor for the the establishment of planning methods. At first, SPO was envisioned as an autonomous establishment of planning methods. At first, SPO was envisioned as an autonomous institution that determines the longinstitution that determines the long--term goals of industrialization term goals of industrialization ssimilar withimilar with its its equivalentsequivalents in the East Asian countries. However, after a while, its autonomous posi-in the East Asian countries. However, after a while, its autonomous posi-tion was abandonedtion was abandoned and it has becomeand it has become open to the influence of daily politics/ political open to the influence of daily politics/ political pressurepressure,, transforming intotransforming into a supportive institution for the short ra supportive institution for the short run needs of the un needs of the private sector. Pamuk,private sector. Pamuk, Türkiye’nin 200 YıllıkTürkiye’nin 200 Yıllık, , 235235--236236. Keyder’s argument on the foun-. Keyder’s argument on the foun-dation of SPO is also worth to mention. He argues that, based on the harsh debates, the dation of SPO is also worth to mention. He argues that, based on the harsh debates, the main efficacious purpose of the coup might be considered as the estmain efficacious purpose of the coup might be considered as the establishment of this ablishment of this institution. It had a privileged position institution. It had a privileged position --de factode facto-- upon the ministries. Çağlar Keyder, upon the ministries. Çağlar Keyder, Türkiye’de Devlet ve Sınıflar Türkiye’de Devlet ve Sınıflar (İstanbul: İletişim Yayınları, 2011), 182.(İstanbul: İletişim Yayınları, 2011), 182.

208 Pamuk, referring to Hirschman, remarks the 1960s as the “easy years” of Pamuk, referring to Hirschman, remarks the 1960s as the “easy years” of ISI. There ISI. There was a division of labor between public and private sector. The final products of the was a division of labor between public and private sector. The final products of the assembling industry, together with textile and food industry wassembling industry, together with textile and food industry wereere mostly carried out mostly carried out by private sector, while the iron steel and petroleum chemicals industries by private sector, while the iron steel and petroleum chemicals industries were gener-were gener-ally under the responsibility of public sector. The growth in the manufacturing sector ally under the responsibility of public sector. The growth in the manufacturing sector was 10 was 10 percentpercent in a year, as the growth rate in the total economy was among 6 in a year, as the growth rate in the total economy was among 6 percentpercent. . Most of the investments for the rapid industrialization process wMost of the investments for the rapid industrialization process wereere finfinanced by the anced by the

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similar with many other third world countries on their way to develop-

similar with many other third world countries on their way to develop-ment.ment. This ISI model, with its emphasis on foreiThis ISI model, with its emphasis on foreign investment and the gn investment and the weightiness of trade relations with the outside world, was more similar weightiness of trade relations with the outside world, was more similar with the Keynesian logic instead of List’s “national economy” model.with the Keynesian logic instead of List’s “national economy” model.209

Through the period mentioned above, an important concern regard-

Through the period mentioned above, an important concern regard-ing the peculiar economic deving the peculiar economic development path of Turkey might be defined elopment path of Turkey might be defined as the bourgeoisieas the bourgeoisie--bureaucracy relations in Turkey. Keyder argues that bureaucracy relations in Turkey. Keyder argues that it was difficult to discern between bureaucracy and upper stage indus-it was difficult to discern between bureaucracy and upper stage indus-trial bourgeoisie in the early 1930s.trial bourgeoisie in the early 1930s.210 The economic policies of statism The economic policies of statism brobrought an increase in industrial production by the homogeneous coali-ught an increase in industrial production by the homogeneous coali-tion of bureaucrats and industrial bourgeoisietion of bureaucrats and industrial bourgeoisie211 which began to be dis-which began to be dis-solved by the Second World War due to immense accumulation of mer-solved by the Second World War due to immense accumulation of mer-chants.chants.212 Even so, during the transformation of the 1960sEven so, during the transformation of the 1960s, both , both bureaucrats and intelligentsia were glorifying the role of a technocratic bureaucrats and intelligentsia were glorifying the role of a technocratic elite on the way of industrialization of the country.elite on the way of industrialization of the country.213

Although the end of ISI period is

Although the end of ISI period is mostlymostly beyond the time interval beyond the time interval discussed in this dissertation, discussed in this dissertation, itit should should be be notenotedd thathat ISI had undergone t ISI had undergone crisis during crisis during the the 1970s. 1970s. At this pointAt this point,, Pamuk’s remark about the qualifi-Pamuk’s remark about the qualifi-cations of state intervention and the role of state in economic develop-cations of state intervention and the role of state in economic develop-ment is worth to mention. He asserts that the power and capacity of the ment is worth to mention. He asserts that the power and capacity of the

domestic saving

domestic savingss and worker remittances. Inflation rate during the 1960s were never and worker remittances. Inflation rate during the 1960s were never more than 10 more than 10 percentpercent a year. Pamuk, a year. Pamuk, Türkiye’nin 200 YıllıkTürkiye’nin 200 Yıllık, , 237237--239239..

209 Çağlar Keyder, Çağlar Keyder, Türkiye’de Devlet ve Sınıflar Türkiye’de Devlet ve Sınıflar (İstanbul: İletişim Yayınları, 2011), 186(İstanbul: İletişim Yayınları, 2011), 186..

210 Ibid., 135.Ibid., 135.

211 Keyder, Keyder, Türkiye’de Devlet, Türkiye’de Devlet, 136. Milor also shares this idea of social alliance between 136. Milor also shares this idea of social alliance between the bureaucrats and the producers of nondurable goods at the cost of other segments the bureaucrats and the producers of nondurable goods at the cost of other segments of the society. He also claims that an important feature oof the society. He also claims that an important feature of statism here was the consci-f statism here was the consci-ous policies it implemented for guaranteeing the labor power for the industrial sector. ous policies it implemented for guaranteeing the labor power for the industrial sector. These included a refusal of supporting the agricultural sector and levying new taxes These included a refusal of supporting the agricultural sector and levying new taxes on them while overlooking the price declines in producon them while overlooking the price declines in products, which ended up with im-ts, which ended up with im-migration from rural to urban areas providing the necessary labor power for industry. migration from rural to urban areas providing the necessary labor power for industry. MilorMilor,, Devleti GeriDevleti Geri, , 152152--153.153.

212 Ibid., 143. Milor in his book provides systematic analysis on the shifts of these Ibid., 143. Milor in his book provides systematic analysis on the shifts of these historical blocs between thistorical blocs between the different periods of development.he different periods of development.

213 Ibid., 180.Ibid., 180.

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government in pursuin

government in pursuing a strategy is determined by the interactions g a strategy is determined by the interactions with the social structure. The presence of conflicting interests and de-with the social structure. The presence of conflicting interests and de-mands make it difficult for a weak government to pursue long run in-mands make it difficult for a weak government to pursue long run in-dustrialization goals. Political instabilities, together with the weak dustrialization goals. Political instabilities, together with the weak gov-gov-ernments and institutions have become the long term features of the ernments and institutions have become the long term features of the social and political environment,social and political environment,214 which all created handicaps for the which all created handicaps for the country to achieve the desired levels of development.country to achieve the desired levels of development.

§ 6.4 Conceptualizations on Development Economics and Conceptualizations on Development Economics and DevelopmeDevelopmental Policies in the University Journalsntal Policies in the University Journals

The reader would find out that most of the articles referred in this part

The reader would find out that most of the articles referred in this part of the chapter were written after the Wof the chapter were written after the World orld WWar ar II. Indeed, the concept II. Indeed, the concept of development was not really a new thing for Turkey in the 1950s. of development was not really a new thing for Turkey in the 1950s. What was new What was new iis a systematic, simultaneous and international consid-s a systematic, simultaneous and international consid-eration on developmental themes as the core mattereration on developmental themes as the core matterss of economics.of economics.215 Extensive work was devoted to the developmental issues from then on. Extensive work was devoted to the developmental issues from then on. According to the bibliography collected by Cavit OrhaAccording to the bibliography collected by Cavit Orhan Tütengil, there n Tütengil, there wewere almost 100 books and 300 articles written on this issuere almost 100 books and 300 articles written on this issue216 and and

214 Pamuk, Pamuk, Türkiye’nin 200 YıllıkTürkiye’nin 200 Yıllık, , 254254..

215 Ülgener claims that this theme became Ülgener claims that this theme became a compellinga compelling subject subject both theoretically and both theoretically and practically practically by the Truman Doctrineby the Truman Doctrine. Ülgener,. Ülgener, ““İktisadi Gelişmenin Şartları vİktisadi Gelişmenin Şartları ve Sınırlarıe Sınırları”, ”, in in Makaleler, Makaleler, 194194.. Starting from the WStarting from the World orld WWar ar II, economic development II, economic development --together together with the social policy implementationswith the social policy implementations-- have become a primary concern at an interna-have become a primary concern at an interna-tional level. The emergence of welfare state required both some retional level. The emergence of welfare state required both some re--organizatiorganization in tax on in tax systems and formation of social policies. In relation with the dominant trend in world, systems and formation of social policies. In relation with the dominant trend in world, developmental themes came to the agenda of the Turkish academia in the aftermath of developmental themes came to the agenda of the Turkish academia in the aftermath of the Wthe World orld WWar ar II particularly by the 1950s.II particularly by the 1950s.

216 Cavit Orhan Tütengil, “Az GCavit Orhan Tütengil, “Az Gelişmiş Ülkeler ve Gelişme İktisadı Konularındaki Türkçe elişmiş Ülkeler ve Gelişme İktisadı Konularındaki Türkçe Kitaplar ve Yazılar BibliyografyasıKitaplar ve Yazılar Bibliyografyası,” ,” İÜİFM İÜİFM 28, no. 128, no. 1--4 (1968): 4 (1968): 198198.. Among them there Among them there

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most of these articles were devoted to constituents of development

most of these articles were devoted to constituents of development economics and how to carry out economic development in Turkey. economics and how to carry out economic development in Turkey.

A primary observation about the material

A primary observation about the material is that articles related is that articles related with development economics in the journal archive of Istanbul Universi-with development economics in the journal archive of Istanbul Universi-tyty217 are relatively few in number than they are in the journals of Anka-are relatively few in number than they are in the journals of Anka-ra University.ra University.218 There might be several reasons for that one of which There might be several reasons for that one of which might be the fact thatmight be the fact that Ankara University was much more ardent to raise Ankara University was much more ardent to raise a generation composed of state officialsa generation composed of state officials, , for Ankara is the capital and for Ankara is the capital and most of the bureaucratic cadre was living theremost of the bureaucratic cadre was living there.. Some of the academics Some of the academics in Mülkiye were also worked in executive positions in policy makin Mülkiye were also worked in executive positions in policy making in ing in governmental cadres. So, it is little wonder that the articles ingovernmental cadres. So, it is little wonder that the articles in Ankara Ankara UniversityUniversity SBF JournalSBF Journal were generally dealing with economic policies were generally dealing with economic policies while while Istanbul University Istanbul University Journal of Faculty of EconomicsJournal of Faculty of Economics was much more was much more obsessed with the theoretical partsobsessed with the theoretical parts of the economics discipline. In addi-of the economics discipline. In addi-tion, the strong legacy of the German tion, the strong legacy of the German émigré economists émigré economists in Istanbul in Istanbul University might have dominated the analysis on the concept of devel-University might have dominated the analysis on the concept of devel-opment as an individual theme, maybe because the national develop-opment as an individual theme, maybe because the national develop-ment goal was alrement goal was already assumed as an implicit aspect in their approach.ady assumed as an implicit aspect in their approach.

Speaking of this difference, a thing worth to remember is that most

Speaking of this difference, a thing worth to remember is that most of the German émigré economists in Istanbul University have already of the German émigré economists in Istanbul University have already left Turkey by the 1950s, the years developmental issues turned outleft Turkey by the 1950s, the years developmental issues turned out to to be the main order of business. Even so, it would be a thoughtbe the main order of business. Even so, it would be a thought--provoking provoking experience to experience to contempcontemplate on their potential attitude towards the late on their potential attitude towards the

were books, many newspaper articles, conference texts, translated material and jour-re books, many newspaper articles, conference texts, translated material and jour-nal articlesnal articles. Forum, İktisat v. Forum, İktisat ve Maliye, Yöne Maliye, Yön were among them.were among them.

217 This might be because the Germans haThis might be because the Germans hadd an extended literature on public finance, and an extended literature on public finance, and the traditional emphasis on this issue was reflected on their publishing and conference the traditional emphasis on this issue was reflected on their publishing and conference presentations in Turkey. presentations in Turkey. Even so, the writings of Even so, the writings of Sabri Ülgener, Nusret Ekin, Gülten Sabri Ülgener, Nusret Ekin, Gülten Kazgan, Ahmet Kılıçbay, Orhan Dikmen, Kenan Bulutoğlu, Mükerrem Hiç, Kenan Ural, Kazgan, Ahmet Kılıçbay, Orhan Dikmen, Kenan Bulutoğlu, Mükerrem Hiç, Kenan Ural, Nevzat Yalçıntaş, V. Rouquet La GarriguNevzat Yalçıntaş, V. Rouquet La Garrigue are significant resources regarding develop-e are significant resources regarding develop-ment economics.ment economics.

218 The writings and translatThe writings and translated materialed material of Ahmet Kılıçbay, Sadun Aren, Necdet Serin, of Ahmet Kılıçbay, Sadun Aren, Necdet Serin, Reşat Aktan, Nejat Bengül, Mehmet Selik, Tuncer Bulutay, Korkut Boratav will consist Reşat Aktan, Nejat Bengül, Mehmet Selik, Tuncer Bulutay, Korkut Boratav will consist the main body of this chapter.the main body of this chapter.

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changing agenda if they would have been still here in those years. Based

changing agenda if they would have been still here in those years. Based on the material they have written right aon the material they have written right along the period of their stay, long the period of their stay, their hopeful viewpoints and high expectations for the future of Turkey their hopeful viewpoints and high expectations for the future of Turkey make us think that they might have looked beyond the potential difficul-make us think that they might have looked beyond the potential difficul-ties in developmental processes and formidable conventional mentality ties in developmental processes and formidable conventional mentality here. Among here. Among the various development theories, maybe they would be the various development theories, maybe they would be closer to Rostow’s approach that is the closer to Rostow’s approach that is the ““stages of growthstages of growth”” –– when we when we think of their distance from Marxian ideologiesthink of their distance from Marxian ideologies –– believing that each believing that each country encounters certain stages on the way to growth, hence acountry encounters certain stages on the way to growth, hence a “catch“catch--up” is possible for developing countries up” is possible for developing countries which which meet the requirements. meet the requirements. Yet, they might have criticized the “one fits for all” attitude of this theory Yet, they might have criticized the “one fits for all” attitude of this theory with the sensitivity to align their arguments to the peculiar conditions with the sensitivity to align their arguments to the peculiar conditions of Turkey. of Turkey.

Returning to t

Returning to the existing material written on development econom-he existing material written on development econom-ics, a prior observation is that the academics haics, a prior observation is that the academics hadd a comprehensive a comprehensive knowledge on the current theories and they positionknowledge on the current theories and they positioneded themselves in themselves in between them with their own critical perspectives.between them with their own critical perspectives.219 Thus, this chapter Thus, this chapter is unique in the sense that the influences of the topical debates and the-is unique in the sense that the influences of the topical debates and the-ories can simultaneously find reactions by the academics in Turkey ories can simultaneously find reactions by the academics in Turkey iin n their search for applicable developmental policies here. By the way, the their search for applicable developmental policies here. By the way, the findings in this chapter would constitutfindings in this chapter would constitute proper examples in tracing the e proper examples in tracing the impacts of the current theories in construction of the field of develop-impacts of the current theories in construction of the field of develop-ment economics in Turkey; and when we think of the peculiarities, ment economics in Turkey; and when we think of the peculiarities, those translated theories those translated theories might be might be resembleresembled ind in some some selected fresh selected fresh fruits for recoverfruits for recovery and rejuvenation of a resistant organism with y and rejuvenation of a resistant organism with peculi-peculi-ar ar rooted allergies.rooted allergies.

Besides, the old theories also appear in the

Besides, the old theories also appear in the journaljournal articles. The clas-articles. The clas-sical, neoclassical and Keynesian approaches, which mostly treat “de-sical, neoclassical and Keynesian approaches, which mostly treat “de-velopment” as “growth” were elaborated, thvelopment” as “growth” were elaborated, though in an expostulatory ough in an expostulatory manner. Based on the articles, it seems like these theories were consid-manner. Based on the articles, it seems like these theories were consid-ered as obstacles in front of comprehending the particularities of the ered as obstacles in front of comprehending the particularities of the

219 Numerous rNumerous references to Nurkse, Pigou, Hicks, Kuznets, Samuelson, Stigler, Rostow, eferences to Nurkse, Pigou, Hicks, Kuznets, Samuelson, Stigler, Rostow, Lewis and Lewis and Hagen demonstrate how they were engaged in the existing literature. Hagen demonstrate how they were engaged in the existing literature.

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concept of development in the developing world. Especially,

concept of development in the developing world. Especially, one canone can see see an explicit positan explicit positioning against the classical theories in the journal of ioning against the classical theories in the journal of Ankara University. For instance, Sadun Aren claims that to tackle the Ankara University. For instance, Sadun Aren claims that to tackle the issue of development individually, one must primarily wound and reject issue of development individually, one must primarily wound and reject the theories that hinder this possibility. He presents the the theories that hinder this possibility. He presents the question “why question “why the developmental aspects of the lessthe developmental aspects of the less--developed countries were ne-developed countries were ne-glected?” and blames the classical theory for this neglection by asserting glected?” and blames the classical theory for this neglection by asserting that classical theory was not interested in the early phases of economic that classical theory was not interested in the early phases of economic development.development.220 He argues againHe argues against the milestone of the classical school st the milestone of the classical school David RicardoDavid Ricardo221 and implicitly positions himself within Gunnar and implicitly positions himself within Gunnar Myrdal’s thesisMyrdal’s thesis222 in the sense that a trade relation that favors the com-in the sense that a trade relation that favors the com-parative advantage couldn’t last forever. parative advantage couldn’t last forever.

The so

The so--called universal presumptions ofcalled universal presumptions of the classical theory were the classical theory were under attack by the other academics in Aunder attack by the other academics in Ankara Universitynkara University as well. Ri-as well. Ri-cardo’s theorem was also criticized by Tuncer Bulutay due to its negli-cardo’s theorem was also criticized by Tuncer Bulutay due to its negli-gence of technological changegence of technological change, , which falsified the diminishing produc-which falsified the diminishing produc-tivity in agriculturetivity in agriculture223 and it was asserted that this theory is neither and it was asserted that this theory is neither acceptable nor valid for the current times.acceptable nor valid for the current times.224 The inconvenience of Ri-The inconvenience of Ri-

220 Sadun Sadun Aren, “İktisaden Az Gelişmiş Memleketlerde Kalkınmanın FinansmanıAren, “İktisaden Az Gelişmiş Memleketlerde Kalkınmanın Finansmanı,,” ” AÜSBFAÜSBFDD 10, no. 3 (1955):10, no. 3 (1955): 2.2. According to the classical theory, Aren suggests, increasing profits According to the classical theory, Aren suggests, increasing profits wouldwould lead tolead to capital accumulation and thereby increascapital accumulation and thereby increasee investment. The only prob-investment. The only prob-lem of the system is the fact that land is limited whichlem of the system is the fact that land is limited which results inresults in diminishing marginal diminishing marginal productivity, increase in prices, increase in nominal wage, decline in profits and in-productivity, increase in prices, increase in nominal wage, decline in profits and in-vestments. Thivestments. This reflects the long run stationary state in Ricardian theory.s reflects the long run stationary state in Ricardian theory.

221 Aren, “İktisaden Az,” 2.Aren, “İktisaden Az,” 2.

222 Myrdal was critiquMyrdal was critique of application of e of application of the the conventional economic theory to developing conventional economic theory to developing countries., countries., Myrdal, “International Inequality” inMyrdal, “International Inequality” in Pioneers, Pioneers, 150. He was asserting that 150. He was asserting that free trade intensifies the binary structure which prfree trade intensifies the binary structure which prevents development in levents development in less ess ddevel-evel-oped oped ccountrieountries. Kazgan, s. Kazgan, İktisadi Düşünceİktisadi Düşünce, 275, 275..

223 This is not the same for the industrial sector for Ricardo. Productivity level is assumed This is not the same for the industrial sector for Ricardo. Productivity level is assumed fixed in industry. Bulutay suggests that this is invalid but it is not important in fixed in industry. Bulutay suggests that this is invalid but it is not important in the the sense that industry has a very little importance in Ricardo’s theory. Tuncersense that industry has a very little importance in Ricardo’s theory. Tuncer Bulutay,Bulutay, BaşlıcaBaşlıca İktisadi Büyüme Nazariyeleriİktisadi Büyüme Nazariyeleri (Ankara: Ankara Üniversitesi Siyasal Bilgiler (Ankara: Ankara Üniversitesi Siyasal Bilgiler Fakültesi, 1961), Fakültesi, 1961), 1111..

224 Bulutay, Bulutay, Başlıca İktisadi Büyüme NazariyeleriBaşlıca İktisadi Büyüme Nazariyeleri, 12, 12..

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cardian Growth Theory for the less developed countries was also debat-

cardian Growth Theory for the less developed countries was also debat-ed in the articlesed in the articles publishedpublished in Istanbul University both because the sin Istanbul University both because the sup-up-posed conditions of the theory were nonexistent in the posed conditions of the theory were nonexistent in the less developed less developed countries (countries (ldcsldcs))225 and a basic foundation of it, namely Malthus’ popula-and a basic foundation of it, namely Malthus’ popula-tion theory was already falsified by the course of events. In any case, it is tion theory was already falsified by the course of events. In any case, it is a wella well--accepted argument that neitheaccepted argument that neither the specialization hypothesis of r the specialization hypothesis of the free trade theorythe free trade theory226 nor the international division of labor based on nor the international division of labor based on comparative advantage comparative advantage wawas suitable for the ldcs. It is understood that s suitable for the ldcs. It is understood that academics in both universities emphasizeacademics in both universities emphasizedd the fallacy of the classical the fallacy of the classical theory theory under current conditions. And such a viewpoint both means to under current conditions. And such a viewpoint both means to challenge the universality approach and the logic that equates develop-challenge the universality approach and the logic that equates develop-ment to growth.ment to growth.

Keynes’ theory also had its share from criticisms primarily for being

Keynes’ theory also had its share from criticisms primarily for being static. In fact, the theory concentratestatic. In fact, the theory concentrates on the short runs on the short run227 which means which means the development in the long run is neglected.the development in the long run is neglected.228 It is also criticized for It is also criticized for disregarding the impacts of investments on productional capacity.disregarding the impacts of investments on productional capacity.229 Indeed, what Keynes set forth was that full employment can’t be auto-Indeed, what Keynes set forth was that full employment can’t be auto-

225 MükeMükerrem Hiç, “Ricardo’nın Büyüme Teorisi ve Az Gelişmiş Memleketlerrrem Hiç, “Ricardo’nın Büyüme Teorisi ve Az Gelişmiş Memleketler,,” ” İÜİFM İÜİFM 2222,, no. 2 (no. 2 (19601960): ): 2525--3535.. In this system the amount of population is subject to the real In this system the amount of population is subject to the real wage levelswage levels; ; yet for Hiç, increase in population is independent of wage rates and yet for Hiç, increase in population is independent of wage rates and shortening ofshortening of population increase via various measures is beneficial. Despite all the population increase via various measures is beneficial. Despite all the fervent challenges against the classical school fervent challenges against the classical school --especially centered around falsification especially centered around falsification of the theories of Ricardo and Malthusof the theories of Ricardo and Malthus-- Sabri Ülgener’s viewpoint seems more moder-Sabri Ülgener’s viewpoint seems more moder-ate. He sayate. He says that the writings of the classical school, especially Ricardo and Marx, s that the writings of the classical school, especially Ricardo and Marx, shouldn’t be distained. Nonetheless also he reminds us that they were primarily con-shouldn’t be distained. Nonetheless also he reminds us that they were primarily con-cerned with the particularities of the industrialized countries. cerned with the particularities of the industrialized countries. Sabri Ülgener, “İktisadi Sabri Ülgener, “İktisadi Gelişmenin Şartları ve Sınırları,” Gelişmenin Şartları ve Sınırları,” İÜİFM İÜİFM 16, no. 116, no. 1--4 (1954): 4. 4 (1954): 4.

226 Ahmet Ahmet Kılıçbay, “Az İnkışaf Etmiş Memleketlerin İktisadi Gelişme ŞartlarıKılıçbay, “Az İnkışaf Etmiş Memleketlerin İktisadi Gelişme Şartları,,”” İÜİFM İÜİFM 13, 13, no. 1no. 1--4 (1952): 4 (1952): 106106..

227 Ahmet Kılıçbay, “Optimal İstihlak Meyli ve Seküler GeAhmet Kılıçbay, “Optimal İstihlak Meyli ve Seküler Gelişmelişme,,”” AÜSBFAÜSBFDD 13, no. 2 (1958): 13, no. 2 (1958): 33..

228 Bulutay, Bulutay, Başlıca İktisadiBaşlıca İktisadi, 41, 41..

229 Kılıçbay, “Optimal İstihlakKılıçbay, “Optimal İstihlak,” ,” 3. Kılıçbay appreciates Oskar Lange as the first economist 3. Kılıçbay appreciates Oskar Lange as the first economist that examines the positive correlation between consumption and investment in a sys-that examines the positive correlation between consumption and investment in a sys-tematic theotematic theoretical framework.retical framework. Ibid.,Ibid., 44..

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matically provid

matically provided as the propensity to save with respect to the invest-ed as the propensity to save with respect to the invest-ment level is high in developed countries. This fixation is valid for cur-ment level is high in developed countries. This fixation is valid for cur-ing the involuntary unemployment in mature economies where free ing the involuntary unemployment in mature economies where free competition conditions are prevalent and price mechanism functiocompetition conditions are prevalent and price mechanism functions ns well. Yet, in the ldcs, the planned amount of saving is generally less than well. Yet, in the ldcs, the planned amount of saving is generally less than the planned investment due to the low the national income.the planned investment due to the low the national income.230 Hence, Hence, instead of being beneficial, it is claimed thatinstead of being beneficial, it is claimed that thethe Keynesian measures Keynesian measures might create adverse effects formight create adverse effects for thethe ldldcs. To increase the saving rates cs. To increase the saving rates and the pace of development, a slowdown in population growth is rec-and the pace of development, a slowdown in population growth is rec-ommended here. This approach orientommended here. This approach orienteded them to a revised version of them to a revised version of the the Keynesian theory forKeynesian theory for thethe developing world, namely the Harroddeveloping world, namely the Harrod--Domar formula.Domar formula.231

Apparent

Apparently, tly, these theories prioritize the “growth” approach in un-hese theories prioritize the “growth” approach in un-derstanding development. Yet, remembering Kazgan’s definitional divi-derstanding development. Yet, remembering Kazgan’s definitional divi-sion between development and growth, development can’t be reduced sion between development and growth, development can’t be reduced to growth in the ldcs as the selfto growth in the ldcs as the self--functioning of the inner dynamifunctioning of the inner dynamics of cs of these societies remains incapable of achieving the goals. these societies remains incapable of achieving the goals. With the pres-With the pres-ence of a conscious intervention into the developmental process, the ence of a conscious intervention into the developmental process, the qualifications of the socioeconomic structure differentiate from the qualifications of the socioeconomic structure differentiate from the ones acquired by the selfones acquired by the self--regulating markregulating market.et.232 The The main distinction main distinction between growth and development is that the latter also requires mental between growth and development is that the latter also requires mental

230 Hiç, “Ricardo’nın Büyüme TeorisiHiç, “Ricardo’nın Büyüme Teorisi,,”” 3232--3333..

231 Ibid.,Ibid., 3636.. Economists that enhance Keynesian theory have made use of Economists that enhance Keynesian theory have made use of TThe he General General TheoryTheory in many respects. Keynes didn’t stress on growth and business cycles, yet Har-in many respects. Keynes didn’t stress on growth and business cycles, yet Har-rod treated throd treated the e existence of existence of business cycles as a deviation from dynamic equilibriabusiness cycles as a deviation from dynamic equilibria;; in in other words, as a part of growth. However, Harrod himself thinks that this is not a other words, as a part of growth. However, Harrod himself thinks that this is not a perfect theoryperfect theory,, sincesince a complete theory a complete theory is expected to includeis expected to include psychological, pecuniary psychological, pecuniary and latencand latency factors. Domar’s theory is y factors. Domar’s theory is also also emphasized because he changed the emphasized because he changed the Keynesian hypothesis Keynesian hypothesis consideringconsidering full employment as a function of national income. full employment as a function of national income. For Domar, full employment is a function of national income/production capacity. For Domar, full employment is a function of national income/production capacity. BulutayBulutay,, Başlıca İktisadiBaşlıca İktisadi, , 4141--6464..

232 Kazgan, Kazgan, İktisadi Düşünceİktisadi Düşünce, , 263263..

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and social changes, a challenging composition

and social changes, a challenging composition,,233 which is the essence which is the essence of the matter for the less developed countries. At this point, it can be of the matter for the less developed countries. At this point, it can be said that the said that the ““dedevelopmentvelopment”” moves ahead ofmoves ahead of ““growthgrowth”” for the academics for the academics in Turkey when we consider their reactions against the theories that in Turkey when we consider their reactions against the theories that prioritize growth and their urgent quest for a way to overcome the men-prioritize growth and their urgent quest for a way to overcome the men-tal and social remnants which were perceived as established barrtal and social remnants which were perceived as established barriers iers for sociofor socio--economic improvement and reasons behind the underdevel-economic improvement and reasons behind the underdevel-opment to a certain extent.opment to a certain extent.

6.4.1 The Reasons Behind Underdevelopment in TurkeyThe Reasons Behind Underdevelopment in Turkey

In the preface of the translated article of Paul Baran on the less devel-

In the preface of the translated article of Paul Baran on the less devel-oped countries in 1951, Nejat Bengüloped countries in 1951, Nejat Bengül234 makes a long note to explicate makes a long note to explicate the reason why he translated this work. He says that this article is worth the reason why he translated this work. He says that this article is worth translation as it presents a very decent analysis on the less developed translation as it presents a very decent analysis on the less developed countries. Yet, he adds an annotation that, by dint of the creation of a countries. Yet, he adds an annotation that, by dint of the creation of a necenecessary political and social order and improvement of the main ser-ssary political and social order and improvement of the main ser-vices of production, Turkey has already surpassed many levels men-vices of production, Turkey has already surpassed many levels men-tioned in the article. Although still ranking among the less developed tioned in the article. Although still ranking among the less developed countries, he says that Turkey has found a way out the “countries, he says that Turkey has found a way out the “blind alley” via blind alley” via

233 Rouquet Rouquet La Garrigue, “İktisadi Gelişme Teorisi ve PrensipleriLa Garrigue, “İktisadi Gelişme Teorisi ve Prensipleri,,”” İÜİFM İÜİFM 27, no. 327, no. 3--4 4 ((19681968): ): 187187..

234 Nejat Bengül Nejat Bengül wawas a graduate of Mülkiye, who also worked for Ministry of Finance for a s a graduate of Mülkiye, who also worked for Ministry of Finance for a while befowhile before coming back to Mülkiye. He also studied in the US in Wisconsin Universi-re coming back to Mülkiye. He also studied in the US in Wisconsin Universi-ty with Fulbright and in MIT and Stanford University with Rockefeller scholarship on ty with Fulbright and in MIT and Stanford University with Rockefeller scholarship on ““İİktisadi ktisadi GGelişme elişme İİçin çin YYatırım atırım KKriterleri riterleri TTeorisi”. Bedri Gürsoyeorisi”. Bedri Gürsoy, , “Doç. Dr. Nejat Bengül “Doç. Dr. Nejat Bengül İçin”,İçin”, 77--9.9. He worked as economic advisHe worked as economic advisoor in SPO and the Committee of the Central r in SPO and the Committee of the Central Bank. Bank. Sadun Sadun Aren, “Dergimizin Eski Yazarlarından Nejat Bengül’ü KaybettikAren, “Dergimizin Eski Yazarlarından Nejat Bengül’ü Kaybettik,,” ” AÜSBFAÜSBFDD 17, no. 2 (17, no. 2 (19621962): ): 29. Aren claims that Bengül considered economics as a part of life 29. Aren claims that Bengül considered economics as a part of life instead of an instead of an abstract information with a thirst to read and learn the “meaningful” abstract information with a thirst to read and learn the “meaningful” things. things. Ibid.,Ibid., 2020..

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the social policies implemented here.

the social policies implemented here.235 Bengül’s words were hopeful Bengül’s words were hopeful and sound when we think of the general structure of Turkey which dif-and sound when we think of the general structure of Turkey which dif-fered from most of the less developed countries at least forfered from most of the less developed countries at least for the fact thatthe fact that there has never been feudalthere has never been feudal oorderrder in this countryin this country. B. But what about the ut what about the feudal remnants in mind? Sabri Ülgener from Istanbul University, con-feudal remnants in mind? Sabri Ülgener from Istanbul University, con-centrated on this facet of the issue,centrated on this facet of the issue, with particular emphasiswith particular emphasis on the pe-on the pe-culiar and ongoing patterns behind underdevelopment.culiar and ongoing patterns behind underdevelopment.

Through the works of Ü

Through the works of Ülgener regarding this issue, the economic lgener regarding this issue, the economic mentality mentality –– the consumption and investment behaviors in the ldcsthe consumption and investment behaviors in the ldcs –– occurs as the main obstacle in front of development. Both Ülgener and occurs as the main obstacle in front of development. Both Ülgener and Aren, the prominent agents of Keynesian thought, ironically emphasizeAren, the prominent agents of Keynesian thought, ironically emphasizedd that athat a condition for development is to condition for development is to decrease consumptiondecrease consumption in a coun-in a coun-try lacking capital.try lacking capital.236 It is because the extreme propensity to consume, It is because the extreme propensity to consume, when combined with already weak productional capacity, creates infla-when combined with already weak productional capacity, creates infla-tionary pressure in the ldcs. Then, it should be questtionary pressure in the ldcs. Then, it should be questioned why there is ioned why there is an extreme propensity to consume here. an extreme propensity to consume here. InIn answeranswering this question,ing this question, Ülgener attracts the attention to the fact that some of the underdevel-Ülgener attracts the attention to the fact that some of the underdevel-oped countries today are the ones which were established on the disin-oped countries today are the ones which were established on the disin-tegrated parts of an old empiretegrated parts of an old empire and keep the feudal consciousness and and keep the feudal consciousness and consumption tendencies of the previous centuries alive in their mind. consumption tendencies of the previous centuries alive in their mind. Therefore, a small amount of increase in the income may led to uncloak Therefore, a small amount of increase in the income may led to uncloak these repressed tendencies in the subconscious level towards consum-these repressed tendencies in the subconscious level towards consum-ing. Thising. This is the circumstance that implicates Turkey in.is the circumstance that implicates Turkey in.237

Examining on the reasons behind the high propensity to consume,

Examining on the reasons behind the high propensity to consume, Ülgener also draws attention to the relation between how that income Ülgener also draws attention to the relation between how that income iis s earned and in what way it earned and in what way it iis consumed. He claims that rapidly increaseds consumed. He claims that rapidly increased

235 Paul Baran, “Geri Kalmış Memleketler İktisadı Üzerine,” translated by Nejat Bengül, Paul Baran, “Geri Kalmış Memleketler İktisadı Üzerine,” translated by Nejat Bengül, AÜSBFAÜSBFDD 6, no. 1 (1951): 1446, no. 1 (1951): 144--145.145.

236 Sadun Sadun Aren, “İktisaden Az GelişmişAren, “İktisaden Az Gelişmiş,” ,” 33..

237 Sabri Sabri Ülgener, “İktisadi Gelişmenin Şartları ve Sınırları: Az Gelişmiş Memleketlerin Ülgener, “İktisadi Gelişmenin Şartları ve Sınırları: Az Gelişmiş Memleketlerin İstihlak ve Yatırım Meselelerine Toplu Bir Bakışİstihlak ve Yatırım Meselelerine Toplu Bir Bakış,,” ” İÜİFMİÜİFM 1616, (, (19541954--19551955): 6): 6..

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income is directly oriented to consumption

income is directly oriented to consumption238 while a gradually ac-while a gradually ac-quired income might exhibit different intentions. Among the ldcs, as all quired income might exhibit different intentions. Among the ldcs, as all the family members don’t yield money, income generation capacity re-the family members don’t yield money, income generation capacity re-mains low, and this derived income is generally usemains low, and this derived income is generally used for consumption; d for consumption; even worse, it is used for conspicuous consumption.even worse, it is used for conspicuous consumption.239

The criticism of this conspicuous consumption is a common theme

The criticism of this conspicuous consumption is a common theme among the articles, which entails the implementation of a mental re-among the articles, which entails the implementation of a mental re-form in addition to the technical reforms. Such a driform in addition to the technical reforms. Such a drift towards conspic-ft towards conspic-uous consumption is understandable indeed, and it is present in many uous consumption is understandable indeed, and it is present in many developing countries due to the “demonstration effect” behind the con-developing countries due to the “demonstration effect” behind the con-sumption behaviors.sumption behaviors.240 As the international relations became more in-As the international relations became more in-tensive and the superior patterns tensive and the superior patterns became more visible for the ldcs, the became more visible for the ldcs, the living standards of the developed countries were envied. The consump-living standards of the developed countries were envied. The consump-tion practices in America for instance, influenced the consumption tion practices in America for instance, influenced the consumption tendencies in many other countries which in turn increased the propen-tendencies in many other countries which in turn increased the propen-sity to importsity to import. The experiences in Turkey during the 1950s reflect the . The experiences in Turkey during the 1950s reflect the validity of this argument by the changing fashion and spread of Ameri-validity of this argument by the changing fashion and spread of Ameri-can style products together with the dream of being “Küçük Amerika”can style products together with the dream of being “Küçük Amerika” (Small America).(Small America). At this point, Ahmet KılıçbayAt this point, Ahmet Kılıçbay241 asserts that the prob-asserts that the prob-lem which ruins the optimal level of consumptionlem which ruins the optimal level of consumption--investment ratio of investment ratio of the country is to imitate solely the consumption styles, instead of pro-the country is to imitate solely the consumption styles, instead of pro-

238 Ülgener,Ülgener, “İktisadi Gelişmenin“İktisadi Gelişmenin,” 15. ,” 15. Kılıçbay also asserts that it is also a matter of Kılıçbay also asserts that it is also a matter of mentamentality. In the less developed countries, time preference is weak, which means utili-lity. In the less developed countries, time preference is weak, which means utili-ty of consuming today is greater than expected utility of consuming in the future.ty of consuming today is greater than expected utility of consuming in the future. Kılıçbay, “Az İnkışafKılıçbay, “Az İnkışaf,,” ” 101, 101, 109.109.

239 Ülgener, Ülgener, “İktisadi Gelişmenin Şartları“İktisadi Gelişmenin Şartları,,” in ” in MakaleleMakaleler,r, 202077--208.208. Ülgener frequently Ülgener frequently emphasizeemphasizess this fact with references to Veblen ve Lewis. He argues that this is so pene-this fact with references to Veblen ve Lewis. He argues that this is so pene-trated us that the one can see the traces in the Ottoman Poetry, in Nabi’s works for trated us that the one can see the traces in the Ottoman Poetry, in Nabi’s works for instance. instance. Ülgener, Ülgener, “İktisadi Gelişmenin Şartları“İktisadi Gelişmenin Şartları,,” in ” in MaMakalelekaleler,r, 202202..

240 Ibid., 201Ibid., 201--212. 212. Inspired by Thornstein VeblenInspired by Thornstein Veblen,, James Duesenberry and Ragnar Nurkse James Duesenberry and Ragnar Nurkse frequently emphasizefrequently emphasizedd on the demonstration effect.on the demonstration effect.

241 Ahmet Kılıçbay, a professor in IAhmet Kılıçbay, a professor in Istanbul stanbul UUniversityniversity, was a graduate of I, was a graduate of Istanbul stanbul UUniversityniversity Faculty of Faculty of Economics who also studied at LSE and Harvard University.Economics who also studied at LSE and Harvard University.

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duction methods.

duction methods.242 This brief fixation reveals a massive behavioThis brief fixation reveals a massive behavioral ral baggage settled in the minds which must be surpassed on the develop-baggage settled in the minds which must be surpassed on the develop-mental path. mental path.

In fact, it

In fact, it wawas argued that this demonstrativeness is not only present s argued that this demonstrativeness is not only present for consumption but also for the investment for consumption but also for the investment side as most of the invest-side as most of the invest-ment gravitates to real estatement gravitates to real estate or mattress saving.or mattress saving.243 According to the According to the observations of Ülgener, tobservations of Ülgener, the businessmen here he businessmen here cancan be be described as in-described as in-decisive and capricious who seek for sudden profits.decisive and capricious who seek for sudden profits.244 Instead of con-Instead of con-siderations on productivity, the volume and enormity of the investment siderations on productivity, the volume and enormity of the investment appeal theappeal the eyes of the investoreyes of the investor. . Yet, Yet, ÜlgenerÜlgener mentions that the produc-mentions that the produc-tivity lies behind the abstract calculations and control devices, not at the tivity lies behind the abstract calculations and control devices, not at the forefront with a forefront with a concrete stateliness.concrete stateliness.245 However, this seems to be unno-However, this seems to be unno-ticed here as the inherited mentality mostly rematiced here as the inherited mentality mostly remained unchanged. ined unchanged. Based on the assertions Based on the assertions of Ülgener of Ülgener about tabout the entrepreneurs here, he entrepreneurs here, it is it is apparently apparently seen that they seen that they ddididn’t really resemble the innovative entre-n’t really resemble the innovative entre-

242 Kılıçbay, “Az İnkışafKılıçbay, “Az İnkışaf,,” ” 103103--104. 104. If the most of the part of national income is spent on If the most of the part of national income is spent on luxury consumption, internal sources would be condemned to fade away. The excess of luxury consumption, internal sources would be condemned to fade away. The excess of consumption paves the wconsumption paves the way for inflationary tendencies. The supplyay for inflationary tendencies. The supply--demand equilibri-demand equilibri-um will be ruined and unbalances for the trade will take place. He gives the example of um will be ruined and unbalances for the trade will take place. He gives the example of Russia and Japan, where the production methods and techniques are imitated. The Russia and Japan, where the production methods and techniques are imitated. The most important criterion is amost important criterion is asserted as the excsserted as the excess of production over consumption. ess of production over consumption. Kılıçbay says that even today’s developed countries experienced a phase that con-Kılıçbay says that even today’s developed countries experienced a phase that con-sumption standards were not that high during their developmental process. This sumption standards were not that high during their developmental process. This might be true but involves a trap of taking of the other detemight be true but involves a trap of taking of the other determinants from the equa-rminants from the equa-tion. tion.

243 For similar criticisms on the investments directed to unproductive sectors see the For similar criticisms on the investments directed to unproductive sectors see the articles of Kazgan, Aren, Ekin. articles of Kazgan, Aren, Ekin.

244 Sabri Ülgener, “İktisadiSabri Ülgener, “İktisadi Gelişme veGelişme ve Yenilenmemizin Zihniyet MuhasebesiYenilenmemizin Zihniyet Muhasebesi,,” in ” in Makaleler, Makaleler, 264. Ülgener ment264. Ülgener mentions that, based on the paper “İktisadi Gelişme ve Yenilenmemizin ions that, based on the paper “İktisadi Gelişme ve Yenilenmemizin Zihniyet Muhasebesi” prepared for the symposium organized by Türk Amerikan Ün-Zihniyet Muhasebesi” prepared for the symposium organized by Türk Amerikan Ün-iversiteliler Derneği, this article is rewrited in iversiteliler Derneği, this article is rewrited in Yeni Türkiye Yeni Türkiye (İstanbul, 1959).(İstanbul, 1959).

245 Sabri Ülgener, “Gelenekçi BiSabri Ülgener, “Gelenekçi Bir Toplumun İktisadi Kıymetler ve Zihniyet Meselelerir Toplumun İktisadi Kıymetler ve Zihniyet Meseleleri,,” in ” in Makaleler, Makaleler, 310310--311.311. This article was presented in Ekonomik ve Sosyal Etüdler Kon-This article was presented in Ekonomik ve Sosyal Etüdler Kon-ferans Heyeti. “İktisadi Kalkınmanın Sosyal Meseleleri,” 31. Konferans, 1963.ferans Heyeti. “İktisadi Kalkınmanın Sosyal Meseleleri,” 31. Konferans, 1963.

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preneurs conceived by Schumpeter

preneurs conceived by Schumpeter246 whowho enhance the developmental enhance the developmental capacity one step further by breakincapacity one step further by breaking out of the routine. From this point g out of the routine. From this point of view, it of view, it is seen thatis seen that,, in addition to being clashed with Keynes for his in addition to being clashed with Keynes for his emphasis on decreasing consumption in this developing country, Ülgen-emphasis on decreasing consumption in this developing country, Ülgen-er propounds the impracticability of a Schumpeterian developmental er propounds the impracticability of a Schumpeterian developmental jumpjump as as wellwell, at least for the current period. This is , at least for the current period. This is remarkable remarkable in the in the sense thatsense that Keynes and Schumpeter are twoKeynes and Schumpeter are two importantimportant figures who had figures who had the uttermost impacts on Ülgener. Even so, it seems like Ülgener never the uttermost impacts on Ülgener. Even so, it seems like Ülgener never ttookook their theories as they are, but searchtheir theories as they are, but searcheded for impfor implementation possi-lementation possi-bilities of them by considering the boundaries in the local.bilities of them by considering the boundaries in the local.

Another justifiable finding of Ülgener is related with the perception

Another justifiable finding of Ülgener is related with the perception of the object/property (eşyaya bakış). In the of the object/property (eşyaya bakış). In the WWestern world, he asserts, estern world, he asserts, wealth is considered within its abswealth is considered within its abstract magnitude. On the other hand, tract magnitude. On the other hand, people here people here --even the most intellectual oneseven the most intellectual ones-- conceive wealth as a per-conceive wealth as a per-sonal entity with its material side, as a property. He claims that we are sonal entity with its material side, as a property. He claims that we are not used to internalize the abstract indicators or symbols, we attach not used to internalize the abstract indicators or symbols, we attach weightweight to the property itself regardless of its functions or service.to the property itself regardless of its functions or service.247 Such a conceptualization is mentioned to be valid even for the savings Such a conceptualization is mentioned to be valid even for the savings part. part. Ülgener truly fixes that the money saved here is so personalized Ülgener truly fixes that the money saved here is so personalized that it is somehow regarded as an extension of ththat it is somehow regarded as an extension of the owner, a satisfactorye owner, a satisfactory instrument merely for its physical and material entity instead of its cre-instrument merely for its physical and material entity instead of its cre-ative potential for output growth.ative potential for output growth.248

Nevertheless, what is missing here for Ülgener

Nevertheless, what is missing here for Ülgener wawas not the will to s not the will to win or risk appetite, as they were even prevalent duringwin or risk appetite, as they were even prevalent during the precapital-the precapital-istic era. Yet, he justifiable underscores that these desires were un-istic era. Yet, he justifiable underscores that these desires were un-

246 Ülgener, “İktisadi YenilenmemizinÜlgener, “İktisadi Yenilenmemizin,,” 2” 26464--265. Schumpeter and Hagen, two MIT265. Schumpeter and Hagen, two MIT economists, highlighted the role of technical change and innovation in developmental economists, highlighted the role of technical change and innovation in developmental shiftsshifts..

247 Ülgener, “GelenekçiÜlgener, “Gelenekçi Bir Toplumun,” 304Bir Toplumun,” 304--306.306. This issue This issue is mentioned in Ozankaya’a is mentioned in Ozankaya’a article article as wellas well. According to him, rathe. According to him, rather than the capabilities of the individual, his iden-r than the capabilities of the individual, his iden-tity is considered tity is considered in the foreground. The implementation of laws and rules is flexible in the foreground. The implementation of laws and rules is flexible upon the subject. Özer Ozankaya, “Ekonomik Gelişmenin Safhalarıupon the subject. Özer Ozankaya, “Ekonomik Gelişmenin Safhaları,,” ” AÜSBFAÜSBFDD 20, no. 2 20, no. 2 (1965):(1965): 290.290.

248 Ülgener, “Gelenekçi Bir ToplumunÜlgener, “Gelenekçi Bir Toplumun,,” 304.” 304.

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framed by a disciplined manner, hence remained thoughtless and dis-

framed by a disciplined manner, hence remained thoughtless and dis-persed. To create a change, some of the value judgments ought to be persed. To create a change, some of the value judgments ought to be changed first.changed first.249 ItIt is true that there is true that there existexist material impossibilities inmaterial impossibilities in ldcs, but they are considered as recoverable via foreign aids or loans.ldcs, but they are considered as recoverable via foreign aids or loans. The principal deficiency here is then ascertained as the absence of peo-The principal deficiency here is then ascertained as the absence of peo-ple with ple with rational behaviorrational behavior compatible with the compatible with the WWestern standards both estern standards both in enterpin enterprises and managementrises and management..250 People here don’t feel themselves People here don’t feel themselves obliged to make calculations with the belief that a supreme power obliged to make calculations with the belief that a supreme power –– The The God, or God, or the the statestate –– would provide for them.would provide for them.251 The main problem to be The main problem to be dissolveddissolved wawas s mentioned as mentioned as this indeed. Fatalism was revealthis indeed. Fatalism was revealed as the ed as the distinctive characteristic of the traditional societies.distinctive characteristic of the traditional societies.252 Yet obviously, Yet obviously, underdevelopment, a vital point of the political phenomena which ac-underdevelopment, a vital point of the political phenomena which ac-count for the ¾ of the worldcount for the ¾ of the world253, can’t be regarded as fate., can’t be regarded as fate.

Apart from all these, the tendency towards idlen

Apart from all these, the tendency towards idlenessess254 and the nar-and the nar-rowness of the needsrowness of the needs,,255 especially observed among the peasant work-especially observed among the peasant work-ers in the ldcsers in the ldcs,, wewere also presented as other obstacles in front of devel-re also presented as other obstacles in front of devel-opment.opment.256 On account of this needlessness, labor turnover occurs and On account of this needlessness, labor turnover occurs and

249 Ülgener, “Gelenekçi Bir ToplumunÜlgener, “Gelenekçi Bir Toplumun,,” 307” 307--308.308.

250 Ibid., 299.Ibid., 299.

251 Ibid., 301. Ibid., 301.

252 Ozankaya, “Ekonomik GelişmeninOzankaya, “Ekonomik Gelişmenin,” ,” 290290..

253 Nejat BengülNejat Bengül,, “İktisadi Gelişme İçin Yatırım Kriterleri“İktisadi Gelişme İçin Yatırım Kriterleri,,” ” AÜSBFAÜSBFDD 11, no. 3 (11, no. 3 (19561956): 30): 3033..

254 Nusret Ekin, “Türkiye’de Ekonomik Gelişme ve İstihdam MeseleleriNusret Ekin, “Türkiye’de Ekonomik Gelişme ve İstihdam Meseleleri,,”” İÜİFM İÜİFM 25, no. 325, no. 3 ((11966966): ): 96 and Nevzad Yalçıntaş, “İktisaden Az Gelişmiş Memleketlerde Emek Arzının 96 and Nevzad Yalçıntaş, “İktisaden Az Gelişmiş Memleketlerde Emek Arzının Tersine ElastikiyetiTersine Elastikiyeti,,”” İÜİFM İÜİFM 25, no. 125, no. 1--2 (2 (19651965):): 9595.. Yalçıntaş makes mention of Kessler Yalçıntaş makes mention of Kessler who was astonished by the procrastination of the mining workers in Turkey during who was astonished by the procrastination of the mining workers in Turkey during their their free time, which free time, which would bewould be an unusal tendency in Germany or Poland.an unusal tendency in Germany or Poland.

255 Rustow claimed that the only purpose of the local people who act within primordial Rustow claimed that the only purpose of the local people who act within primordial instincts is only procuring and contenting themselves with the necessities for their instincts is only procuring and contenting themselves with the necessities for their humble lives. Thishumble lives. This prevents economic development. Yalçıntaş,prevents economic development. Yalçıntaş, ““İktisaden Az Gelişmişİktisaden Az Gelişmiş,” ,” 9999.. Özer OzankayaÖzer Ozankaya also emphasizes on this issue. He claims that the most distinguish-also emphasizes on this issue. He claims that the most distinguish-ing featureing featuress of the ldcs of the ldcs areare the inertia and fatalism. the inertia and fatalism. Ozankaya, “Ozankaya, “Ekonomik Gelişmenin Ekonomik Gelişmenin SafhalarSafhaları,” ı,” 286286..

256 Yalçıntaş mentions a clear reflection of this situation in a field research of David Yalçıntaş mentions a clear reflection of this situation in a field research of David Lerner in Balgat in 1950, through the answers of the mukhtar and the grocer for the Lerner in Balgat in 1950, through the answers of the mukhtar and the grocer for the

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this brings about instabilities.

this brings about instabilities.257 Based on the observationsBased on the observations, , it it wawas as as-s-sertedserted that the working time becomes shorter as the wages increase, that the working time becomes shorter as the wages increase, since the worker confines himself with the money adequate for his nar-since the worker confines himself with the money adequate for his nar-row needs. A high desire for money here is perceived as an unhallowed row needs. A high desire for money here is perceived as an unhallowed manner. The mmanner. The misinterpretations and misapplications of the religious isinterpretations and misapplications of the religious and philosophical views and philosophical views wewere exposed as the primary problems to be re exposed as the primary problems to be solved.solved.258 And it is quite obvious that the widely acknowledged mental-And it is quite obvious that the widely acknowledged mental-ity of “just enough to keep body and soul together” (bir lokma biity of “just enough to keep body and soul together” (bir lokma bir hırka) r hırka) is the opposite of “homo economicus” and it is this mentality that stands is the opposite of “homo economicus” and it is this mentality that stands against the developmental expectations from a capitalist society.against the developmental expectations from a capitalist society.

As for the possible solutions for these structural problems, Nejat

As for the possible solutions for these structural problems, Nejat BengülBengül259 and Reşat Aktanand Reşat Aktan260 emphasize on themphasize on the role of state whose prior e role of state whose prior function is considered as the provision of economic development. Crea-function is considered as the provision of economic development. Crea-tion of a community with commercial consciousness and enabling pub-tion of a community with commercial consciousness and enabling pub-

questions of the surveyor

questions of the surveyor visvis--àà--visvis monetary gain. Mukhtar is abstinent and says monetary gain. Mukhtar is abstinent and says “Tha“Thank God, what a time to be alive!” The grocer on the other hand is uneasy, desiring nk God, what a time to be alive!” The grocer on the other hand is uneasy, desiring for better things. “I am not like the villagers, they are unaware of better things.” When for better things. “I am not like the villagers, they are unaware of better things.” When it is asked “what would you like for your village?”, the mukhtar says “seeds, moneyit is asked “what would you like for your village?”, the mukhtar says “seeds, money donation” while the groces says “I would like the villagers go to town and see the donation” while the groces says “I would like the villagers go to town and see the world instead of retiring to pasture”. As for the question that “where would you like to world instead of retiring to pasture”. As for the question that “where would you like to live apart from Turkey?”, the mukhtar says “I would like to go nowhere else” while live apart from Turkey?”, the mukhtar says “I would like to go nowhere else” while the the grocer says “America, where even the ordinary people can get rich.” grocer says “America, where even the ordinary people can get rich.” Yalçıntaş,Yalçıntaş, ““İkti-İkti-saden Az Gelişmişsaden Az Gelişmiş,” ,” 112112..

257 Nusret Ekin also pays attention to this fact. Referring to Lewis, he says that there is job Nusret Ekin also pays attention to this fact. Referring to Lewis, he says that there is job specialization in the developed countries specialization in the developed countries contracontrary tory to the the casecase in the ldcsin the ldcs. Nusret Ekin, . Nusret Ekin, “İşgücü ve Ekonomik Gelişme“İşgücü ve Ekonomik Gelişme,,”” İÜİFM İÜİFM 25, no. 125, no. 1--22 ((19651965): ): 8686..

258 Nevzad Yalçıntaş, “İktisaden Az GelişmişNevzad Yalçıntaş, “İktisaden Az Gelişmiş,” ,” 119119--120120..

259 Despite his early bereavement, Nejat Bengül Despite his early bereavement, Nejat Bengül wawas among the most productive s among the most productive academics on this subjeacademics on this subject in Ankara University. Apart from his own writings, he trans-ct in Ankara University. Apart from his own writings, he trans-lated lated severalseveral texts of Paul Baran, John Kenneth Galbraith, Richard Stone and Hollis texts of Paul Baran, John Kenneth Galbraith, Richard Stone and Hollis CheneryChenery..

260 Reşat Aktan was a graduate of Ankara University Agricultural Faculty who had his Reşat Aktan was a graduate of Ankara University Agricultural Faculty who had his PPhhDD from Californfrom California Berkeley. Then he joined Economic Policy Chair in Mülkiye. He also ia Berkeley. Then he joined Economic Policy Chair in Mülkiye. He also served for the Ministry of Agriculture.served for the Ministry of Agriculture.

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lic interest in material welfare were regarded as essential.

lic interest in material welfare were regarded as essential.261 It is appar-It is appar-ent that the usual aent that the usual action is based on social or even biological habits in-ction is based on social or even biological habits in-stead of a cost benefit analysis; stead of a cost benefit analysis; but but according to the authors, this rou-according to the authors, this rou-tine ought to be abandoned right away with the emphasis on state’s tine ought to be abandoned right away with the emphasis on state’s multiplier role at this point,multiplier role at this point,262 not by force but via economic innot by force but via economic incentives. centives. The existence of democratic institutions and atmosphere The existence of democratic institutions and atmosphere wewere high-re high-lighted as the catalysators of the developmental process.lighted as the catalysators of the developmental process.263

Before ending this section regarding mentality, it would be meaning-

Before ending this section regarding mentality, it would be meaning-ful to lend an ear to Sadun Aren. In fact, one might exful to lend an ear to Sadun Aren. In fact, one might expect a more struc-pect a more struc-turalist analysis from Aren, when we think of his political viewpoint in turalist analysis from Aren, when we think of his political viewpoint in which which thethe Marxian vein makes itself apparent. Marxian vein makes itself apparent. NeverthelessNevertheless, he pays , he pays attention to problems regarding mentality as well, but with a crucial attention to problems regarding mentality as well, but with a crucial add on; he argues that the padd on; he argues that the problem is not only related with roblem is not only related with the the mindset mindset patterns in the ldcs but also with the public opinion in the developed patterns in the ldcs but also with the public opinion in the developed world. He seems to challenge the viewpoint that assumes a oneworld. He seems to challenge the viewpoint that assumes a one--sided sided neediness of the developing countries neediness of the developing countries by arguingby arguing that the developed that the developed countcountries began to ries began to contemplate oncontemplate on the developmental problems since the developmental problems since they consider their welfare to be contingent upon the welfare of the ldcs they consider their welfare to be contingent upon the welfare of the ldcs to a certain extent. This being the case, the people in the developed to a certain extent. This being the case, the people in the developed countries for Aren would better be aware of the incountries for Aren would better be aware of the interest alliance be-terest alliance be-tween the developed and lesstween the developed and less--developed countries. For him, this rela-developed countries. For him, this rela-tion should be perceived as a partnership instead of a competition.tion should be perceived as a partnership instead of a competition.264

261 Reşat AktanReşat Aktan,, “İktisaden Az Gelişmiş Memleketlerin Başlıca Ekonomik Meseleleri“İktisaden Az Gelişmiş Memleketlerin Başlıca Ekonomik Meseleleri,,” ” AÜSBFAÜSBFDD 9, no. 2 (1954):9, no. 2 (1954): 7575..

262 Nejat Nejat Bengül, “İktisadi Gelişme Bengül, “İktisadi Gelişme Mekanizması Üzerine Bir DenemeMekanizması Üzerine Bir Deneme,,”” AÜSBFAÜSBFDD 7, no. 1 7, no. 1 (1952): (1952): 196196.. Bengül asserts that the problem of unemployment in ldcs is completely Bengül asserts that the problem of unemployment in ldcs is completely different from the unemployment in mature economies. Therefore, the impact of the different from the unemployment in mature economies. Therefore, the impact of the investment is scrutinized in recognition oinvestment is scrutinized in recognition of increasing productivity, not employment. f increasing productivity, not employment.

263 Sadun Sadun Aren and Aren and Albert Albert Gorvine, “İktisadi Kalkınma ve Totaliter LiberallerGorvine, “İktisadi Kalkınma ve Totaliter Liberaller,,”” AÜSBFAÜSBFDD 11, 11, no. 3 (1956):no. 3 (1956): 388388--390390..

264 Aren, “İktisaden Az GelişmişAren, “İktisaden Az Gelişmiş”, ”, 11.. The General Manager of the WThe General Manager of the World orld BBankank Eugene Black Eugene Black claimclaimeded thathat it should not be forgotten that the capital source flowing in to the ldcs are t it should not be forgotten that the capital source flowing in to the ldcs are the savings of the public of the developed countries. Bülentthe savings of the public of the developed countries. Bülent Yazıcı,Yazıcı, “Yeni Delhi Kon-“Yeni Delhi Kon-feransı ve İktisadi Kalkınma Mevzuuferansı ve İktisadi Kalkınma Mevzuu,”,” İÜİFM İÜİFM 18, no. 118, no. 1--4 (4 (19561956): ): 8383..

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Laying stress

Laying stress on this on this factfact was important in the sense that it extends the was important in the sense that it extends the scope of the issue to a morscope of the issue to a more unnoticeable but a very complementary e unnoticeable but a very complementary domaindomain. Furthermore, such an interpretation of the importance of col-. Furthermore, such an interpretation of the importance of col-laboration signifies a theoretical distance from the dependency ap-laboration signifies a theoretical distance from the dependency ap-proaches that set apart the interests of each in a clearproaches that set apart the interests of each in a clear--cut manner. cut manner.

6.4.2 The AmenThe Amendments and Strategies for Economic Developmentdments and Strategies for Economic Development

United Nations’ and French Ministry of Foreign Affairs Technical Advis-

United Nations’ and French Ministry of Foreign Affairs Technical Advis-er Rouquet La Garrigue who came to Istanbul in 1962 to give lectures er Rouquet La Garrigue who came to Istanbul in 1962 to give lectures approximately for approximately for threethree months, defined the less developed countries months, defined the less developed countries as as nonnon--hinged, dependent and minimized economies in which the modern hinged, dependent and minimized economies in which the modern and outdated sectors coexist.and outdated sectors coexist.265 Such a definition sSuch a definition soundounds like a model s like a model indeed. indeed. On the other hand, economists like Hirschman and Myrdal men-On the other hand, economists like Hirschman and Myrdal men-tion that instead of making general presumptions, ation that instead of making general presumptions, analysis on the coun-nalysis on the coun-try specific features is more beneficial in understanding the dynamics of try specific features is more beneficial in understanding the dynamics of these countries. In this direction, Ülgener propounds that most suitable these countries. In this direction, Ülgener propounds that most suitable definition for our country is Raul Prebisch’s description that the ldcs are definition for our country is Raul Prebisch’s description that the ldcs are the countries the countries in which most of the population works in agriculture and in which most of the population works in agriculture and the real income per capita is low.the real income per capita is low.266 This This wawas obviously valid for Turkey. s obviously valid for Turkey. Other distinctive characteristics of Turkey as they tOther distinctive characteristics of Turkey as they takeake place in the place in the journals are: low and instableincome level, disguised unjournals are: low and instableincome level, disguised unemployment employment accompanying idle resources, low marginal productivity and incomplete accompanying idle resources, low marginal productivity and incomplete sectors. sectors.

In these premises, the sincere efforts of the academics to better

In these premises, the sincere efforts of the academics to better these given conditions off are apparentthese given conditions off are apparent allall through the writings. Alt-through the writings. Alt-hough a “catch up” hough a “catch up” in developmin development ent with Rostow’s words wasn’t afforded with Rostow’s words wasn’t afforded

265 La Garrigue, “İktisadLa Garrigue, “İktisadi Gelişme Teorisii Gelişme Teorisi,,” 187” 187..

266 Ülgener, “İktisadi Gelişmenin ŞartlarıÜlgener, “İktisadi Gelişmenin Şartları,,”” 194194--195195..

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yet, at least the academics in Turkey seem to “catch up” the theories of

yet, at least the academics in Turkey seem to “catch up” the theories of pioneer development economists. Estonian Ragnar Nurkse’s “vicious pioneer development economists. Estonian Ragnar Nurkse’s “vicious circle”, Austrian Rosenstein Rodan’s “big push” and government induced circle”, Austrian Rosenstein Rodan’s “big push” and government induced industindustrialization, and the LSE educated Saint Lucian economist Arthur rialization, and the LSE educated Saint Lucian economist Arthur Lewis’ “disguised unemployment” Lewis’ “disguised unemployment” aare the very first themes frequently re the very first themes frequently used in the articles. For all these economists, the prerequisite for devel-used in the articles. For all these economists, the prerequisite for devel-opment opment wawas to increase s to increase capital formation and capicapital formation and capital formation can be tal formation can be obtained by increased savings. Howeverobtained by increased savings. However, unsurprisingly in the ldcs, sav-, unsurprisingly in the ldcs, sav-ings remain low due to the lowings remain low due to the low--income levels as almost all the income is income levels as almost all the income is spent on consumption. Hence, the inadequate investment level leads to spent on consumption. Hence, the inadequate investment level leads to low national income alow national income againgain267, which can be defined as the , which can be defined as the vicious circlevicious circle of the ldcs.of the ldcs.

Indeed, this is not an insoluble fact. In line with Lewis

Indeed, this is not an insoluble fact. In line with Lewis268, Sadun , Sadun Aren comes up with a solution offer. As it is hard to cut down the con-Aren comes up with a solution offer. As it is hard to cut down the con-sumption levels more sumption levels more --since they since they wewere already very low here already very low herere-- on behalf on behalf of the savings, he suggests that capital formation should be financed by of the savings, he suggests that capital formation should be financed by the utilization of the savings at hand which is the utilization of the savings at hand which is the disguised unemploy-the disguised unemploy-mentment. As land . As land iis scarce and labor s scarce and labor iis excess, more that ¼ of the labor re-s excess, more that ¼ of the labor re-mainmainss marginal in the curremarginal in the current situation. The excess labor on land esti-nt situation. The excess labor on land esti-mated by Reşat Aktan mated by Reşat Aktan iis around 50s around 50--55 55 percentpercent..269 Hence, the marginal Hence, the marginal productivity of this excess agricultural labor equalproductivity of this excess agricultural labor equalss to zero.to zero.270 This cir-This cir-

267 NecdetNecdet SerinSerin, “Türkiye’, “Türkiye’ninnin İktisadi Kalkınmaİktisadi Kalkınması sı ve Yabancı Hususi Sermayeve Yabancı Hususi Sermaye,,”” AÜSBFAÜSBFDD 13, no. 3 (1958): 48.13, no. 3 (1958): 48.

268 Arthur Lewis in his article in Arthur Lewis in his article in Pioneers Pioneers inin DevelopmentDevelopment says that “Rsays that “Ragnar Nurkse agnar Nurkse opened the door what looked at first like a painless solution, using surplus labor for opened the door what looked at first like a painless solution, using surplus labor for capital formation.”capital formation.” Lewis, “Development Economics,” in Lewis, “Development Economics,” in Pioneers, Pioneers, 134134..

269 Nevzad Yalçıntaş, “İktisaden Az GelişmişNevzad Yalçıntaş, “İktisaden Az Gelişmiş,,”” 110110, cited in, cited in Cahit TalasCahit Talas ((19611961:: 532532--534534).).

270 Kazgan, Kazgan, İktisadi Düşünce, İktisadi Düşünce, 266. 266. Kazgan portrays the explanatory framework of the Kazgan portrays the explanatory framework of the economists emphasizing on this fact as follows: “economists emphasizing on this fact as follows: “The conglomeration of labor power in The conglomeration of labor power in agriculture results in zero marginal productivity even though they can get a share agriculture results in zero marginal productivity even though they can get a share ffrom the total income. However, capitalism assumes marginal productivity as equal to rom the total income. However, capitalism assumes marginal productivity as equal to wage. As the marginal productivity of labor in wage. As the marginal productivity of labor in less developed countrieless developed countries is zero, that s is zero, that labor is wasted. labor is wasted. AA solution solution mightmight be the organization of the public and utilization ofbe the organization of the public and utilization of that labor power in infrastructural investments. Therefore, labor becomes beneficial to that labor power in infrastructural investments. Therefore, labor becomes beneficial to capital formation. As the capital formation levels increase, the problem becomes solv-capital formation. As the capital formation levels increase, the problem becomes solv-

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cumstance unfolds the necessity of transferring the excess population

cumstance unfolds the necessity of transferring the excess population fromfrom agriculture to agriculture to newlynewly industrial sectors, to the investment fields industrial sectors, to the investment fields where maximum benefit can be provided.where maximum benefit can be provided.271 This argument is strength-This argument is strength-ened by ened by anan emphasis onemphasis on thethe increasing roles of the excess population in increasing roles of the excess population in production of the goodproduction of the goodss also to be consumed by the talso to be consumed by the themselveshemselves272 which means the total productwhich means the total product273 will increase without any decline in will increase without any decline in consumption levels in case of such a policy implementation. It is also consumption levels in case of such a policy implementation. It is also mentioned that a land reform would serve for unveiling the disguised mentioned that a land reform would serve for unveiling the disguised unemployed.unemployed.274 But But the first prerequisthe first prerequisite ite iis clarified as pulling the sur-s clarified as pulling the sur-plus laborplus labor fromfrom agriculture to productive industries.agriculture to productive industries.275

Apparently, such alterations can’t be generated automatically. Then,

Apparently, such alterations can’t be generated automatically. Then, it becomes clear that state intervention and fiscal operations play the it becomes clear that state intervention and fiscal operations play the key roles in arrangement key roles in arrangement of the recommended policies. In addition to of the recommended policies. In addition to opening up new employment possibilities for the rural people whose opening up new employment possibilities for the rural people whose marginal contribution to productivity is zero, policies that provide the marginal contribution to productivity is zero, policies that provide the transfer of funds from agriculture to other productive sectors transfer of funds from agriculture to other productive sectors aare em-re em-phaphasizedsized276 and taxation of the agricultural sector and taxation of the agricultural sector iis considered as sig-s considered as sig-

able in the sense that the surplus labor was also a result of the absence of enoug

able in the sense that the surplus labor was also a result of the absence of enough capi-h capi-taltal.”.”

271 Bengül,Bengül, “İktisadi Gelişme İçin Yatırım Kriterleri“İktisadi Gelişme İçin Yatırım Kriterleri,,”” 304304.. Similar point of view can be seen Similar point of view can be seen in Reşat Aktan’s articles in Reşat Aktan’s articles as wellas well. Aktan also emphasizes the importance of agricultural . Aktan also emphasizes the importance of agricultural productivity and he says that the shortcut to industrializatiproductivity and he says that the shortcut to industrialization is agricultural develop-on is agricultural develop-ment and productivity increase, which can be provided by abandoning the primordial ment and productivity increase, which can be provided by abandoning the primordial techniques. Aktan, “İktisaden Az Gelişmiştechniques. Aktan, “İktisaden Az Gelişmiş,” ,” 6767; ; AktanAktan,, “Türk Ziraatinde Prodüktivite“Türk Ziraatinde Prodüktivite,,”” AÜSBFAÜSBFDD 13, no. 2 (13, no. 2 (19581958):): 48.48.

272 Aren, “İktisaden Az GelişmiAren, “İktisaden Az Gelişmişş,,”” 33..

273 Here, we should attract attention to the emphasis on productivity and efforts to Here, we should attract attention to the emphasis on productivity and efforts to maximize the total product instead of a Keynesian apprehension of full employment, maximize the total product instead of a Keynesian apprehension of full employment, even in Aren’s arguments who even in Aren’s arguments who wawas one of the main actors in recognition of Keynes s one of the main actors in recognition of Keynes hhere. ere.

274 Kenan Ural, “Az Gelişmiş Milletlerin Kalkınmasında Liberalizm mi Devlet Müdahalesi Kenan Ural, “Az Gelişmiş Milletlerin Kalkınmasında Liberalizm mi Devlet Müdahalesi mimi Uygulanmalı Belli Başlı İktisadi Sektörlerdeki Tatbik Şekli,” Uygulanmalı Belli Başlı İktisadi Sektörlerdeki Tatbik Şekli,” İÜİFM İÜİFM 24, no. 124, no. 1--2 2 ((19641964): ): 277277..

275 Aktan, “İktisaden Az GelişmişAktan, “İktisaden Az Gelişmiş,,”” 7676..

276 Ural, Ural, ““Az GelişmişAz Gelişmiş,” ,” 277277..

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nificant.

nificant.277 The actual Turkish tax system is criticized The actual Turkish tax system is criticized for not beingfor not being de-de-signed for inducing economic growth.signed for inducing economic growth.278 As long as the agricultural sec-As long as the agricultural sec-tor remains nontor remains non--taxable, the agricultural income,taxable, the agricultural income, instead of being a ma-instead of being a ma-jor part of investment capital, continues to be wasted on consumption jor part of investment capital, continues to be wasted on consumption and this creates inflationary pressure.and this creates inflationary pressure.279 Even so,Even so, the peculiarity of the peculiarity of Turkish state’s potential and experience in engaging in economic enter-Turkish state’s potential and experience in engaging in economic enter-prises prises areare appreciated, wappreciated, which meant the vicious circle of low demandhich meant the vicious circle of low demand--low investment can be surpassed.low investment can be surpassed.280 The academics seem to be in pur-The academics seem to be in pur-suit of a hopeful change, they suit of a hopeful change, they are unlikely toare unlikely to be contented with remain-be contented with remain-ing as an agricultural country. The goal of industrialization has long ing as an agricultural country. The goal of industrialization has long been been acknowledged as the motor power of national development since acknowledged as the motor power of national development since the Jeune Turcsthe Jeune Turcs;; yetyet,, the disruptions and structural conditions have re-the disruptions and structural conditions have re-tarded this process leading to a more frequent calls for urgent solution tarded this process leading to a more frequent calls for urgent solution offers by the academic elites.offers by the academic elites.

Preoccupation of th

Preoccupation of the academics with this issue is both meaningful e academics with this issue is both meaningful and understandable in the sense that the decade between 1950 and and understandable in the sense that the decade between 1950 and 1960 refers to Democrat Party rule during when the agriculture1960 refers to Democrat Party rule during when the agriculture--based based economic policies were implemented. economic policies were implemented. On the other handOn the other hand, , confronting confronting with awith a ttranslation of a conference text of Redvers Opie from Harvard in ranslation of a conference text of Redvers Opie from Harvard in

277 Aren,Aren, “İktisaden Az Gelişmiş“İktisaden Az Gelişmiş,”,” 4. 4.

278 Kenan Kenan Bulutoğlu and Bulutoğlu and Orhan Orhan Dikmen, “Türkiye’nin İktisadi Gelişmesi ve Devlet Dikmen, “Türkiye’nin İktisadi Gelişmesi ve Devlet MaliyesiMaliyesi,,”” İÜİFMİÜİFM 29, no. 129, no. 1--44 ((19581958): ): 146. The authors attract146. The authors attract thethe attention to the fact attention to the fact that, despite all the benefits agriculturthat, despite all the benefits agricultural sectoral sector made bymade by the spending policies, the the spending policies, the productivity productivity wawas not really increased. In the absence of technical education and mod-s not really increased. In the absence of technical education and mod-ern production techniques, a increase should not be anticipated. When the propensity ern production techniques, a increase should not be anticipated. When the propensity to conspicuous consumption in this sector is considto conspicuous consumption in this sector is considered, a reform that would subject ered, a reform that would subject the agricultural the agricultural sector to an income tax becomes an exigency. Ibid., 137sector to an income tax becomes an exigency. Ibid., 137--145145..

279 Aren, “İktisaden Az GelişmişAren, “İktisaden Az Gelişmiş,,” 4. Most of the public spending is oriented to agriculture, ” 4. Most of the public spending is oriented to agriculture, yet agricultural sector is exempted from income tax due to vote concerns. Orhan Dik-yet agricultural sector is exempted from income tax due to vote concerns. Orhan Dik-men and Kenan Bulutoğlu, “Türkiye’nin İktisadi Gelişmesimen and Kenan Bulutoğlu, “Türkiye’nin İktisadi Gelişmesi,,” 126. Aren claims that ” 126. Aren claims that the the investments to agriculture can’t generate capital accumulation since their consump-investments to agriculture can’t generate capital accumulation since their consump-tion is not under control; paving the way for inflationary pressure. Aren, 12. A similar tion is not under control; paving the way for inflationary pressure. Aren, 12. A similar theme can also be seen in Mehmet Selik, “İktisadi Gelişme Sermaye İhtiyacı ve Yabtheme can also be seen in Mehmet Selik, “İktisadi Gelişme Sermaye İhtiyacı ve Yabancı ancı SermayeSermaye,,”” 14.14.

280 Aren, “İktisaden Az GelişmişAren, “İktisaden Az Gelişmiş,,”” 15. 15.

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1953

1953 iis s remarkableremarkable as it reflects a contradictory stance against the gen-as it reflects a contradictory stance against the gen-eral views of the academics. For Opie,eral views of the academics. For Opie, aa development model based on development model based on agriculture agriculture iis acclaimeds acclaimed281 with the assertion that a with the assertion that a shortshort--term indus-term indus-trialization is not a promising thing for the ldcs. Within this respect, trialization is not a promising thing for the ldcs. Within this respect, concentration of agriculture concentration of agriculture iis pointed as the target of developmental s pointed as the target of developmental policies instead of industrialization.policies instead of industrialization.282 For Opie, planning and national For Opie, planning and national policies policies aare located as re located as obstacles in front of the flow of foreign aid.obstacles in front of the flow of foreign aid.283 Being such an ardent opponent of planning reflects the dominance of Being such an ardent opponent of planning reflects the dominance of the ideological vein the ideological vein ––in an exaggerated manner indeedin an exaggerated manner indeed–– during those during those yearsyears,, when we think of the competition between when we think of the competition between the the Soviets and Soviets and the the US. US. At this point, this conference text can be evaluated as a representa-At this point, this conference text can be evaluated as a representa-tion of what America expects from Turkey in trade relations and even tion of what America expects from Turkey in trade relations and even more, the discourse of the texts seems like a caveat for further industri-more, the discourse of the texts seems like a caveat for further industri-alization efforts in Turkey. This viewpoint waalization efforts in Turkey. This viewpoint was compatible with the rul-s compatible with the rul-ing party’s ing party’s planplan--averseaverse economic policies and maybe the reason behind economic policies and maybe the reason behind the translation of this text the translation of this text wawas the convergence policies with the USA s the convergence policies with the USA during when during when obtaininobtaining foreign aid was relatively easy and economic g foreign aid was relatively easy and economic indicators were indicators were quite quite ffine. However, in the second half of the decade, ine. However, in the second half of the decade, economic situation was worsened due to these unplanned policies. En-economic situation was worsened due to these unplanned policies. En-suring foreign aid and investment became difficult by dint of the deteri-suring foreign aid and investment became difficult by dint of the deteri-orated economic indicators. This might have alarmed the academics to orated economic indicators. This might have alarmed the academics to speak up about the circumstance and create alternative policy sugges-speak up about the circumstance and create alternative policy sugges-tions for that current atmosphere. tions for that current atmosphere.

281 Redvers Opie, “Amerikan Yardımı ve Kalkınma MeselesiRedvers Opie, “Amerikan Yardımı ve Kalkınma Meselesi,,”” translated by Cemal translated by Cemal MıhçıoğluMıhçıoğlu, , AÜSBFAÜSBFDD 8, no. 1 (8, no. 1 (19531953): ): 9797..

282 Aren in an article he wrote years later, namely “İktisadi Aren in an article he wrote years later, namely “İktisadi KalkınmayıKalkınmayı SınırlandSınırlandırıcı Rolü ırıcı Rolü Bakımından ZiraatBakımından Ziraat,,”” AÜSBFAÜSBFDD 18, no. 3 (1963): 5618, no. 3 (1963): 56 claims that agriculture is not a rival claims that agriculture is not a rival developmental field for industrialization, it is a condition for development. developmental field for industrialization, it is a condition for development. AAlthough lthough the most important source of capital accumulation is revealed as the agthe most important source of capital accumulation is revealed as the agricultural ricultural productivity increase, he defines economic development as the expansion of activities productivity increase, he defines economic development as the expansion of activities outside agriculture. outside agriculture.

283 Opie, “Amerikan YardımıOpie, “Amerikan Yardımı,”,” 9494.. Reşat Reşat Aktan in his article Aktan in his article mentionsmentions that foreign that foreign investment might be influenced by state interventions ainvestment might be influenced by state interventions and nationalist flows, even so nd nationalist flows, even so he considers state intervention as indispensable. Aktan, “İktisaden Az Gelişmişhe considers state intervention as indispensable. Aktan, “İktisaden Az Gelişmiş,,” 91” 91--92.92.

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The articles of the 1950s were mainly dealing with the conditions

The articles of the 1950s were mainly dealing with the conditions and possibilities of development with special emphasis on existing cir-and possibilities of development with special emphasis on existing cir-cumstances, the cumstances, the mental preparation process of the public and the po-mental preparation process of the public and the po-tential obstacles in front of development. By the 1960s and the founda-tential obstacles in front of development. By the 1960s and the founda-tion of SPOtion of SPO284;; the themes on planning, foreign investment, employment the themes on planning, foreign investment, employment and demography, social change and comparisons with other land demography, social change and comparisons with other less ess ddeveevel-l-oped oped ccountrieountries became prominent. As Cahit Talas claimed, the problems s became prominent. As Cahit Talas claimed, the problems that were perceived as nonthat were perceived as non--negotiable have become discussable in the negotiable have become discussable in the aftermath of the 1960 revolution.aftermath of the 1960 revolution.285 For instance, the articles and books For instance, the articles and books of neoof neo--Marxian economists were begun to be tMarxian economists were begun to be translated. In fact, an arti-ranslated. In fact, an arti-cle of neocle of neo--Marxian Paul Baran was translated by Nejat Bengül in 1951, Marxian Paul Baran was translated by Nejat Bengül in 1951, even before the 1960s, but this tendency gained momentum by the even before the 1960s, but this tendency gained momentum by the 1960s. In 1963, Bilsay Kuruç from A1960s. In 1963, Bilsay Kuruç from Ankara nkara UUniversityniversity translated Raul translated Raul Prebisch’s “Latin Amerika’nPrebisch’s “Latin Amerika’nın İktisadi Kalkınması ve Belli Başlı Sorun-ın İktisadi Kalkınması ve Belli Başlı Sorun-ları”ları” (Economic Development of Latin America and Fundamental Prob-(Economic Development of Latin America and Fundamental Prob-lems)lems). The translator of the magnum opus . The translator of the magnum opus Das Das KapitalKapital, Mehmet Selik, Mehmet Selik286 also translated many articles of the economists including Singer, Hagen also translated many articles of the economists including Singer, Hagen and Baraand Baran. Oskar Lange’sn. Oskar Lange’s Kalkınma YöntemleriKalkınma Yöntemleri in 1964 and Maurice in 1964 and Maurice Dobb’s Dobb’s Az Gelişmiş Ülkeler ve İktisadi KalkınmaAz Gelişmiş Ülkeler ve İktisadi Kalkınma in 1965 were also trans-in 1965 were also trans-lated by Selik. Apart from the neolated by Selik. Apart from the neo--Marxians, Arthur Lewis’ “İktisadi Marxians, Arthur Lewis’ “İktisadi Kalkınma Üzerine Bir İnceleme” was translated in 1965 by CaKalkınma Üzerine Bir İnceleme” was translated in 1965 by Cavit Çelik vit Çelik Kurdoğlu and the Kurdoğlu and the translation of translation of Rostow’sRostow’s Stages of GrowthStages of Growth ((İktisadi İktisadi Gelişme MerhaleleriGelişme Merhaleleri) ) was published in 1966. Rosensteinwas published in 1966. Rosenstein--Rodan’s Rodan’s ““Doğu Doğu ve Güneydoğu Avrupa’nın Sanayileşme Problemlerive Güneydoğu Avrupa’nın Sanayileşme Problemleri” (Problems of In-” (Problems of In-

284 It is important to make mention of the name Jan Tinbergen, a Dutch economist who It is important to make mention of the name Jan Tinbergen, a Dutch economist who played an important role in foundation of Splayed an important role in foundation of State tate PPlannlanning ing OOrganizationrganization. Tinbergen was . Tinbergen was among the pioneers of developmental planning approach and Nobel Prize Winner in among the pioneers of developmental planning approach and Nobel Prize Winner in 1969 with Ragnar Frisch.1969 with Ragnar Frisch.

285 Cahit Cahit Talas, Talas, ““Plan, Kalkınma ve İktisadi SistemlerPlan, Kalkınma ve İktisadi Sistemler,,”” AÜSBFAÜSBFDD 17, no. 3 (1962):17, no. 3 (1962): 11..

286 His own PhD thesis in His own PhD thesis in İİstanbul stanbul University Faculty of Economics in 1960 was on University Faculty of Economics in 1960 was on ““Az Gelişmiş Memleketlerin Kalkınması İle İlgisi Bakımından Yabancı Sermaye ve Türkiye'de Yabancı Sermaye Meselesi”” and assoand associciate professorship thesis was ate professorship thesis was onon ““Marksist Değer TeorisiMarksist Değer Teorisi”” in 1968. He was also ain 1968. He was also a member of the member of the Workers Party of Workers Party of TurkeyTurkey..

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dustrialization of Eastern and South

dustrialization of Eastern and South--Eastern Eastern Europe)Europe) was translated by was translated by İzzettin Önder in 1966. Beyond the university journals and books, there İzzettin Önder in 1966. Beyond the university journals and books, there were also translated materials of Myrdal, Nurkse, Hershlag in the jour-were also translated materials of Myrdal, Nurkse, Hershlag in the jour-nalnal ForumForum and conferences in Istanbul regarding the multiple facets of and conferences in Istanbul regarding the multiple facets of developmental prodevelopmental process.cess.287

As can be clearly seen, the Marxian theories were much more appre-

As can be clearly seen, the Marxian theories were much more appre-ciated in Ankara University than Istanbul University, particularly after ciated in Ankara University than Istanbul University, particularly after the establishment of the new constitution in 1961. Even so, it is hard to the establishment of the new constitution in 1961. Even so, it is hard to see an ideological inclination towardsee an ideological inclination towards socialism as a system through the s socialism as a system through the articles. The choice or a comparison between capitalism and socialism articles. The choice or a comparison between capitalism and socialism was not presented as an ideological preferencewas not presented as an ideological preference by Nejat Bengülby Nejat Bengül, but , but grounded on each system’s possible contributions to development.grounded on each system’s possible contributions to development.288 And as it is allAnd as it is alleged by La Garrigue that an implementation of a single eged by La Garrigue that an implementation of a single and plain ideology is out of the question for the early phases of devel-and plain ideology is out of the question for the early phases of devel-opment.opment.289 Thus, the goal of national development seems to sweep over Thus, the goal of national development seems to sweep over the ideological adherences for a long time in Turkey. In spitethe ideological adherences for a long time in Turkey. In spite of ac-of ac-knowledging a theory with its all theoretical assumptions, the academ-knowledging a theory with its all theoretical assumptions, the academ-ics here opt for the suitable parts of these theories particularly regard-ics here opt for the suitable parts of these theories particularly regard-ing the feasibility of their practical facets, the economic policies that ing the feasibility of their practical facets, the economic policies that provide for development possibilitprovide for development possibilities.ies.

Another noteworthy

Another noteworthy but unexpectedbut unexpected observation is that the depend-observation is that the depend-ency theory dency theory dididn’t really occupy the agenda, at least for the first half of n’t really occupy the agenda, at least for the first half of the 1960s. This might be in parallel with the approach of Arthur Lewis the 1960s. This might be in parallel with the approach of Arthur Lewis who claimed that dependency theory mightwho claimed that dependency theory might be valid for the 19be valid for the 19thth century century but it is not useful for the independent countries of the 20but it is not useful for the independent countries of the 20thth century.century.290 Indeed, most of the development economists around the world con-Indeed, most of the development economists around the world con-sciously preferred to remain within the scope of the capitalistic dis-sciously preferred to remain within the scope of the capitalistic dis-course while equippicourse while equipping prescriptions for the lng prescriptions for the less ess ddeveloped eveloped ccountrieountries. s.

287 Tütengil, “Tütengil, “Az Gelişmiş Ülkeler ve Gelişme İktisadı Konularındaki Türkçe Kitaplar ve Az Gelişmiş Ülkeler ve Gelişme İktisadı Konularındaki Türkçe Kitaplar ve Yazılar BibliyografyasıYazılar Bibliyografyası,” 197,” 197--235.235.

288 Bengül, Bengül, ““İktisadi Gelişmeİktisadi Gelişme Mekanizması,” 130.Mekanizması,” 130.

289 La Garrigue, “İktisadi Gelişme TeorisiLa Garrigue, “İktisadi Gelişme Teorisi,”,” 191944..

290 LewisLewis,, “Development Economics,” “Development Economics,” in in Pioneers Pioneers inin DevelopmentDevelopment, 125, 125..

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Then it seems like the purpose was just to regulate the functioning of

Then it seems like the purpose was just to regulate the functioning of the system via state intervention and planning,the system via state intervention and planning,291 not to alter it. In par-not to alter it. In par-allel with this viewpoint, we don’t really witness a revolt agallel with this viewpoint, we don’t really witness a revolt against the ainst the world order or institutions of capitalism through the reviewed universi-world order or institutions of capitalism through the reviewed universi-ty journals in Turkey. There are no arguments advocating any disen-ty journals in Turkey. There are no arguments advocating any disen-gagement from the existing world system or trade relations. The aca-gagement from the existing world system or trade relations. The aca-demics were principled and pragmatist, butdemics were principled and pragmatist, but not doctrinaire; and this is not doctrinaire; and this is at least visible in their approaches at least visible in their approaches visvis--àà--visvis foreign investment.foreign investment.

The British

The British--German economist Hans Singer was asserting that most German economist Hans Singer was asserting that most of the investments in ldcs, namely the foreign investments, should be of the investments in ldcs, namely the foreign investments, should be considered as the local considered as the local investments of the industrialized countries. For investments of the industrialized countries. For him, these investments have never become parts of the economies of him, these investments have never become parts of the economies of the ldcs, but appear as supplementary extensions of the developed the ldcs, but appear as supplementary extensions of the developed economies, for the benefit of themselves.economies, for the benefit of themselves.292 Singer’s view regarding the Singer’s view regarding the detdetrimental effects of foreign investment, although signifying a very rimental effects of foreign investment, although signifying a very central remark for the developing world, seems not to be totally central remark for the developing world, seems not to be totally acknowledged by the acknowledged by the local local academics. This is because a crucial hinge for academics. This is because a crucial hinge for capital formation is considered as foreign capital capital formation is considered as foreign capital in a country with such in a country with such low saving rates. The willingness low saving rates. The willingness visvis--àà--visvis foreign investment is nour-foreign investment is nour-ished by the references from the UN reports and economic development ished by the references from the UN reports and economic development conferences as well. Yet, although it conferences as well. Yet, although it iis counted as a facilitating factor for s counted as a facilitating factor for a more accelerata more accelerated development processed development process,,293 it it iis not desired without s not desired without any restrictionsany restrictions294 and it shouldn’t be considered as a remedy for the and it shouldn’t be considered as a remedy for the short term problems according to the academics.short term problems according to the academics.295 The expectations The expectations from a beneficial foreign investment from a beneficial foreign investment aare portrayed as an increased ex-re portrayed as an increased ex-pport capacity of the country and a decreased import rate as it would ort capacity of the country and a decreased import rate as it would

291 Kazgan, Kazgan, İktisadi Düşünce, İktisadi Düşünce, 263263..

292 IIbid., 275. cited from Singer (1964: 163).bid., 275. cited from Singer (1964: 163).

293 Mehmet Selik, “İktisadi Gelişme, Sermaye İhtiyacı ve Yabancı SermayeMehmet Selik, “İktisadi Gelişme, Sermaye İhtiyacı ve Yabancı Sermaye,,”” AÜSBFAÜSBFDD 16, no. 16, no. 4 (4 (19611961):): 1414.. HHe emphasizes that international division of labor lowers the selfe emphasizes that international division of labor lowers the self--sacrifice in thesacrifice in the less developed countries.less developed countries.

294 This tendency can be clearly seen in This tendency can be clearly seen in Mehmet SelikMehmet Selik’s and ’s and Necdet Serin’s articlesNecdet Serin’s articles..

295 Mehmet Mehmet Selik, “Yabancı Sermayeyi Teşvik Kanunlar ve TatbikatSelik, “Yabancı Sermayeyi Teşvik Kanunlar ve Tatbikatıı,,”” AÜSBFAÜSBFDD 16, no. 3 16, no. 3 ((19611961): ): 3434..

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give a hand with the production of imported goods in the country.

give a hand with the production of imported goods in the country.296 Nonetheless, an economy totally dependent on foreign investment Nonetheless, an economy totally dependent on foreign investment iis s unwished both because the virtual level of investment unwished both because the virtual level of investment was already fall-was already fall-en behind the expected rateen behind the expected rate297 in a country with low social fixed capital in a country with low social fixed capital and economic instabilitiesand economic instabilities298 --despite all the incentives to draw foreign despite all the incentives to draw foreign capitalcapital-- and the probable unfavorable results of foreign investment in and the probable unfavorable results of foreign investment in case it is welcomed in alcase it is welcomed in all fields and sectors without any limitations.l fields and sectors without any limitations.299

Most of the academics agree on the fact that foreign investment is

Most of the academics agree on the fact that foreign investment is indispensable. On the other hand, what they really stress on is the indispensable. On the other hand, what they really stress on is the planned organization of inner sources and coordination of investments. planned organization of inner sources and coordination of investments. AreAren was associating the distribution of investments with n was associating the distribution of investments with a a chess game, chess game, in which one must take a step on planned and calculable moves.in which one must take a step on planned and calculable moves.300 With With reference to Dobb, Selik reminds us that economic development cannot reference to Dobb, Selik reminds us that economic development cannot

296 Selik, “Yabancı SermayeSelik, “Yabancı Sermaye,” ,” 77..

297 Selik claims that one should keep in mind that the United States is almost selfSelik claims that one should keep in mind that the United States is almost self--sufficient and rather than pinning hope on American capital, investment search except sufficient and rather than pinning hope on American capital, investment search except thatthat should be pursuedshould be pursued. Mehmet Selik, “Milletlerarası Sermaye Hareketlerinin Kısa . Mehmet Selik, “Milletlerarası Sermaye Hareketlerinin Kısa TarihçesiTarihçesi,,”” AÜSBFAÜSBFDD 15, no. 415, no. 4 ((19601960): ): 5959--6161..

298 Selik considers thisSelik considers this as as aa mission of mission of the the lless ess ddeveloped countrieeveloped countries, s, and capital should be and capital should be generated by its own saving potential, generated by its own saving potential, not by borrowing. Selnot by borrowing. Selik refers to UN reports ik refers to UN reports which claimwhich claimeded that both the foreign capital and debts can be found if the social fixed that both the foreign capital and debts can be found if the social fixed capital investments are done.capital investments are done. Selik,Selik, “İktisadi Gelişme, Sermaye“İktisadi Gelişme, Sermaye,,” 20” 20.. In another article, In another article, he argues that ahe argues that as long as we dons long as we don’’t prepare credit demant prepare credit demands in accordance with the ds in accordance with the required conditionsrequired conditions andand the problems in international payment continues, the result the problems in international payment continues, the result will be unchanged. Selik, “Milletlerarası Sermaye Hareketlerininwill be unchanged. Selik, “Milletlerarası Sermaye Hareketlerinin,,” 65” 65..

299 As for the unfavorable results of foreign investment without limitationsAs for the unfavorable results of foreign investment without limitations, the risk of , the risk of cash outflows, monopolizationcash outflows, monopolization andand elimination of the national investors from the mar-elimination of the national investors from the mar-ket are presented and the new Yabancı Sermayeyi Teşvik Kanunuket are presented and the new Yabancı Sermayeyi Teşvik Kanunu (Law for Incentives (Law for Incentives for the Foreign Capital)for the Foreign Capital) is criticized as it opens agricultural and trade seis criticized as it opens agricultural and trade sectors to for-ctors to for-eign investment. Selik emphasizes RPP’s opposition to expansion of these fields to eign investment. Selik emphasizes RPP’s opposition to expansion of these fields to foreign investmentforeign investment which claims that “it is very possible that the farmers will get out which claims that “it is very possible that the farmers will get out of the place foreign capital steps in”of the place foreign capital steps in”. (. (yabancı sermayenin girdiği yerdeyabancı sermayenin girdiği yerden çiftçinin n çiftçinin çıkması muhtemeldir.çıkması muhtemeldir.) ) Selik, “Yabancı Sermaye,”Selik, “Yabancı Sermaye,” 99--10.10. IIn addition, there occurs a risk n addition, there occurs a risk of tax evasion or monopolizationof tax evasion or monopolization and Selik mentions that itand Selik mentions that it must be complied with must be complied with strict legal principles. strict legal principles. Ibid., Ibid., 1212..

300 Aren,Aren, “İktisaden Az Gelişmiş“İktisaden Az Gelişmiş,,”” 1111..

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just be regarded as a fiscal issue; but a matter

just be regarded as a fiscal issue; but a matter of economic organization of economic organization and planning indeed.and planning indeed.301 A development plan with a diligent marginal A development plan with a diligent marginal analysis and a multifaceted economic development analysis and a multifaceted economic development iis in demand by the s in demand by the academicsacademics302 and this emphasis occurred as a common denominator and this emphasis occurred as a common denominator among the authors. The main point among the authors. The main point is then, not the volume of invest-is then, not the volume of invest-ment but the relations between the constitution of the sort of invest-ment but the relations between the constitution of the sort of invest-ment with economic development; in other words, finding the most ment with economic development; in other words, finding the most suitable direction for the investments.suitable direction for the investments.303 An institutionalization to de-An institutionalization to de-sign a framework fosign a framework for the investment capital r the investment capital iis desired. Therefore, a bal-s desired. Therefore, a bal-anced growth and complementarity of industries should be pursued.anced growth and complementarity of industries should be pursued.304 By the emphasis on balanced growth and prior determination on the By the emphasis on balanced growth and prior determination on the optimal distribution of productive forces,optimal distribution of productive forces, one mightone might again again see thesee the thetheo-o-retical connection with Ragnar Nurkseretical connection with Ragnar Nurkse305, Arthur Lewis and Rosenstein , Arthur Lewis and Rosenstein Rodan; and Rodan; and the drift apartthe drift apart from Albert O. Hirschman, who from Albert O. Hirschman, who wawas not really s not really a proponent of planning with his emphasis on imbalanced growth pos-a proponent of planning with his emphasis on imbalanced growth pos-sibilities. sibilities.

Hirschman, also a well

Hirschman, also a well--known economiknown economist in Turkey who describes st in Turkey who describes himself as a dissenterhimself as a dissenter306, , wawas also against the externally dictated im-s also against the externally dictated im-plementations intended to the lplementations intended to the less developed ess developed ccountrieountries, including the s, including the Marshall Plan. Yet, such a view Marshall Plan. Yet, such a view seemsseems notnot bebe really recognized in Turkey really recognized in Turkey when we think of twhen we think of the fact that the prominent economists of the he fact that the prominent economists of the WWestern estern world were frequently consulted during the critical periods. For in-world were frequently consulted during the critical periods. For in-stance, American development economist Hollis Chenery prepared a stance, American development economist Hollis Chenery prepared a report on economic development in Turkey in 1953 and Nobel Laurate report on economic development in Turkey in 1953 and Nobel Laurate DutcDutch economist Jan Tinbergen played a key function in foundation of h economist Jan Tinbergen played a key function in foundation of

301 Selik, “İktisadi GelişmeSelik, “İktisadi Gelişme,,” 28” 28..

302 Aktan,Aktan, “İktisaden Az Gelişmiş“İktisaden Az Gelişmiş,”,” 7676..

303 For further analysis, see For further analysis, see Bengül, “İktisadi Gelişme İçin Yatırım Kriterleri”Bengül, “İktisadi Gelişme İçin Yatırım Kriterleri”..

304 Aktan,Aktan, “İktisaden Az Gelişmiş“İktisaden Az Gelişmiş,”,” 8787.. CComplementary industries approach also existomplementary industries approach also existss in in Hirschman’sHirschman’s analysis but for analysis but for Hirschman, Hirschman, planning is not planning is not considered considered necessary.necessary.

305 Aktan makes mention of Nurkse by saying that Say’s Law might be valid for the lAktan makes mention of Nurkse by saying that Say’s Law might be valid for the less ess ddeveloped eveloped ccountrieountries only under certain s only under certain limitations. Aktan, “İktisaden Az Gelişmiş”, 87.limitations. Aktan, “İktisaden Az Gelişmiş”, 87.

306 Albert O. HAlbert O. Hirschman, “A Dissenter’s Confession: ‘The Strategy of Economic Develop-irschman, “A Dissenter’s Confession: ‘The Strategy of Economic Develop-ment’ Revisited,” in ment’ Revisited,” in PioneersPioneers, 88, 88..

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SPO with the support of OECD.

SPO with the support of OECD.307 Indeed, Hirschman in his opposition Indeed, Hirschman in his opposition against the dictations outside was relying on the creative potential of against the dictations outside was relying on the creative potential of the ldcs for their capability of materializing the uthe ldcs for their capability of materializing the unexpected things.nexpected things.308 This was based on his faith for the “hidden rationality” in the societies This was based on his faith for the “hidden rationality” in the societies of the lof the less ess ddeveloped eveloped ccountrieountries. Then it is not surprising that his theory s. Then it is not surprising that his theory iis not really embraced s not really embraced locallylocally; because more than the presence of such a ; because more than the presence of such a hidden rationalhidden rationalityity, the existence of , the existence of hidden unemployment hidden unemployment in this coun-in this coun-try made sense for the try made sense for the prior prior concerns of the academics.concerns of the academics.

Another famous development economist whose theory was not real-

Another famous development economist whose theory was not real-ly acknowledgedly acknowledged at localat local was Walt Whitman Rostow. His hopeful theory was Walt Whitman Rostow. His hopeful theory that is that is ““stagesstages of growthof growth”” ddididn’t yield a great acceptance among the n’t yield a great acceptance among the journal articles, though very welljournal articles, though very well--known. Indeed, this theory known. Indeed, this theory iis de-s de-scribed as a systematic analysis of economic development for many de-scribed as a systematic analysis of economic development for many de-veloped and developing countries by Necdet Serinveloped and developing countries by Necdet Serin309;; yetyet,, the criticathe critical l voices against voices against aare much more resounded. Özer Ozankaya mentions that re much more resounded. Özer Ozankaya mentions that Rostow Rostow iis not even aware of the problems of the ldcs and this unaware-s not even aware of the problems of the ldcs and this unaware-ness is not coincidental. In his opinion, Rostow intendedly disregarded ness is not coincidental. In his opinion, Rostow intendedly disregarded the peculiarities and inner dynamics of the lthe peculiarities and inner dynamics of the less ess ddeveloped eveloped ccountrieountries in s in attempt to write out a attempt to write out a ““nonnon--communist manifestocommunist manifesto”.”. Besides, this thesis Besides, this thesis is regarded as inconsistent with theoretical ambiguities within which is regarded as inconsistent with theoretical ambiguities within which the whole obtainable data is not taken into consideration. Ozankaya the whole obtainable data is not taken into consideration. Ozankaya

307 Pamuk, Pamuk, Türkiye’nin 200 Yıllık, Türkiye’nin 200 Yıllık, 235.235.

308 Kazgan,Kazgan, İktisadi Düşünce,İktisadi Düşünce, 282282.. In the article In the article of Hirschmanof Hirschman in in Pioneers Pioneers inin DevelopmentDevelopment he speaks of his experihe speaks of his experience of Columbia and says that “a synthetic development plan ence of Columbia and says that “a synthetic development plan compiled on the basis of heroic estimates is the least need of Columbia. This was a compiled on the basis of heroic estimates is the least need of Columbia. This was a repetition of what I had most disliked about the work on the Marshall Plrepetition of what I had most disliked about the work on the Marshall Plan. […] an. […] My My instinct was to try to underinstinct was to try to understand better “their” patterns of action, rather than assume stand better “their” patterns of action, rather than assume from the outset that they could only be “developed” bu importing a set of techniques from the outset that they could only be “developed” bu importing a set of techniques they knew nothing about.” Hirschman,they knew nothing about.” Hirschman, “A Dissenter’s Confession,”“A Dissenter’s Confession,” in in Pioneers,Pioneers, 91.91.

309 Necdet Serin was graduatedNecdet Serin was graduated from SBF in 1957 and became assistant in from SBF in 1957 and became assistant in ““Economic Economic Theory.Theory.”” He went to Wisconsin University for master degree and wrote his PhD on He went to Wisconsin University for master degree and wrote his PhD on Industrialization of Turkey in SBF. He worked as an expert in UN European Economy Industrialization of Turkey in SBF. He worked as an expert in UN European Economy Commission in Geneva in between 1964Commission in Geneva in between 1964--1965.1965. https://www.biyografya.com/biyografi/10638https://www.biyografya.com/biyografi/10638

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strengthens his argu

strengthens his arguments by referring to Marxist academicsments by referring to Marxist academics likelike Paul Paul Baran and Eric Hobsbawm, for whom this thesis was Baran and Eric Hobsbawm, for whom this thesis was also considered as also considered as circular and opencircular and open--ended as well.ended as well.310 This theory This theory iis not s not regarderegarded appro-d appro-priate for the conditions of Turkey, also for the incidence that the cpriate for the conditions of Turkey, also for the incidence that the con-on-tribution of the agricultural income to public income is insignificant tribution of the agricultural income to public income is insignificant contrary to the assumptions of Rostow’s theory.contrary to the assumptions of Rostow’s theory.311

It is commonly accepted that economic development can be

It is commonly accepted that economic development can be achieved by a substantial rise in the savingachieved by a substantial rise in the saving--investment volume. On the investment volume. On the other other hand, potential responses for the questions like who would un-hand, potential responses for the questions like who would un-dertake the financing of development or who would benefit from the dertake the financing of development or who would benefit from the income growth are shaped around the ideological attitudes of the econ-income growth are shaped around the ideological attitudes of the econ-omists.omists.312 On the relation between income distribution and deOn the relation between income distribution and develop-velop-ment, a similar tendency is witnessed. Even unequal income distribu-ment, a similar tendency is witnessed. Even unequal income distribu-tion is favored by some theorists with the apprehension that tion is favored by some theorists with the apprehension that consumption would increase in case of equality, decelerating the devel-consumption would increase in case of equality, decelerating the devel-opmental process. opmental process. According toAccording to the theory of Rostow fthe theory of Rostow for instance, in-or instance, in-come must be distributed on behalf of the entrepreneur if an increase in come must be distributed on behalf of the entrepreneur if an increase in the the saving ratesaving ratess is desired.is desired.313 Lewis was also supporting the transfer of Lewis was also supporting the transfer of income towards the capitalists assuming they would make relatively income towards the capitalists assuming they would make relatively

310 Ozankaya,Ozankaya, ““Ekonomik Gelişmenin SafhalarıEkonomik Gelişmenin Safhaları,,” 285” 285.. He He assertsasserts that a developmental that a developmental mechanism that interconnects the stages is absent and the concept of takemechanism that interconnects the stages is absent and the concept of take--off doesn’t off doesn’t have a predictive account.have a predictive account.

311 Rostow claimed that Turkey was taking off by 1937Rostow claimed that Turkey was taking off by 1937.. YYet for Ozankaya, Tuet for Ozankaya, Turkey is stillrkey is still bounded by the vicious circlebounded by the vicious circle and and still amongst the lstill amongst the less ess ddeveloped eveloped ccountrieountries. s. Ozankaya, Ozankaya, ““Ekonomik GelişmeninEkonomik Gelişmenin,” ,” 292292..

312 Kazgan, Kazgan, İktisadi Düşünce, İktisadi Düşünce, 273273..

313 Also Mükerrem Hiç claims that such an assumption might not be valid as the tendency Also Mükerrem Hiç claims that such an assumption might not be valid as the tendency towartowards consumption and import among theds consumption and import among the locallocal entrepreneurs is high. Hiç, “Ricar-entrepreneurs is high. Hiç, “Ricar-do’nın Büyüme Teorisido’nın Büyüme Teorisi,” ,” 3232.. Besides, Kenan Ural mentions that the idea of enterprise is Besides, Kenan Ural mentions that the idea of enterprise is very weak as the entrepreneur thinks that his efforts might not be remunerated. The very weak as the entrepreneur thinks that his efforts might not be remunerated. The pressurepressure of the traditions, low educational level, the presence of socially or religiously of the traditions, low educational level, the presence of socially or religiously priviliged people thinking of themselves as the only beneficiaries priviliged people thinking of themselves as the only beneficiaries aare all re all portrayed portrayed as as the obstacles in front of development. Kenan Uralthe obstacles in front of development. Kenan Ural,, “Az Gelişmiş Milletlerin “Az Gelişmiş Milletlerin kalkınmaskalkınmasında Liberalizm mi Devlet Müdahalesi mi Uygulanmalı?ında Liberalizm mi Devlet Müdahalesi mi Uygulanmalı?,,” ” İÜİFMİÜİFM 24, no. 1 24, no. 1 ((19641964): ): 276276--277277..

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high savings and investments.

high savings and investments. Yet, in contrast with Lewis, Korkut Yet, in contrast with Lewis, Korkut Boratav argueBoratav arguess that income transfers from rich to poor decreases total that income transfers from rich to poor decreases total amount of consumption. In a similar vein with Nurkse, he suggests that amount of consumption. In a similar vein with Nurkse, he suggests that inequality in income distribution lowers the average saving rates due to inequality in income distribution lowers the average saving rates due to the the conspicuous consumption.conspicuous consumption.314 For Boratav, saving isn’t a function of For Boratav, saving isn’t a function of absolute income but relative income levels and consumption might be absolute income but relative income levels and consumption might be contingent upon “contingent upon “karşılıklı bağıntıkarşılıklı bağıntı” between the consumer groups. As-” between the consumer groups. As-sertions disregarding this possibility remain baseless, they are theoreti-sertions disregarding this possibility remain baseless, they are theoreti-cally incomplete and incorrect according to Boratav.cally incomplete and incorrect according to Boratav.315 This viewThis view of of BoratavBoratav expands the field by driving forward both the psychologicexpands the field by driving forward both the psychological and al and sociological aspect of development and embodies a manifesto against sociological aspect of development and embodies a manifesto against stereotyped categorizations of the occidental rational patterns.stereotyped categorizations of the occidental rational patterns.

Lastly, the recommended institutional reforms on the way to devel-

Lastly, the recommended institutional reforms on the way to devel-opmentopment should also be touched uponshould also be touched upon. “The growth cap. “The growth capital is not only ital is not only money. It is the money effectively used for accelerating economic devel-money. It is the money effectively used for accelerating economic devel-opment. It is the money combined with particular behaviors, institu-opment. It is the money combined with particular behaviors, institu-tions and technology.”tions and technology.” claimed Eugene Black, The General Manager of claimed Eugene Black, The General Manager of the World Bank during the New Delthe World Bank during the New Delhi Conference in 1958.hi Conference in 1958.316 The de-The de-termining ingredient of development is then not only the level of in-termining ingredient of development is then not only the level of in-vestment on factors; but the knowledge, qualifications, political impact, vestment on factors; but the knowledge, qualifications, political impact, capabilities of labor, entrepreneurship and other psychological factors. capabilities of labor, entrepreneurship and other psychological factors. In other woIn other words, the “human” factor.rds, the “human” factor.317

In conducting a developmental process within which the human In conducting a developmental process within which the human factor lies at the heart, the critical importance of a social reforms shines factor lies at the heart, the critical importance of a social reforms shines out. Gunnar Myrdal was putting the egalitarian institutional reforms out. Gunnar Myrdal was putting the egalitarian institutional reforms including heaincluding health care, food production, sanitary facilities and better lth care, food production, sanitary facilities and better schooling for the poor at the center as prerequisites of rapid develop-schooling for the poor at the center as prerequisites of rapid develop-ment. Raising the consumption levels of the less advantageous seg-ment. Raising the consumption levels of the less advantageous seg-ments of the society is considered as a condition for a higher ments of the society is considered as a condition for a higher productivi-productivi-

314 Korkut Korkut Boratav, “Gelir Dağılımı ve Tüketim EğilimiBoratav, “Gelir Dağılımı ve Tüketim Eğilimi,,” ” AÜSBFAÜSBFDD 18, no. 1 (18, no. 1 (19631963): ): 2626..

315 Boratav, “Gelir DağılımıBoratav, “Gelir Dağılımı,,”” 6161..

316 Yazıcı, “Yeni Delhi KonferansıYazıcı, “Yeni Delhi Konferansı,” ,” 8282..

317 TalasTalas, “Plan, Kalkınma, “Plan, Kalkınma,” ,” 1111..

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ty.

ty.318 In the absence of a developed labor market, the In the absence of a developed labor market, the WWestern categori-estern categori-zations and existing conceptualizations on unemployment become zations and existing conceptualizations on unemployment become meaningless for him. Then, investment towards the manpower is essen-meaningless for him. Then, investment towards the manpower is essen-tial. Such a need tial. Such a need isis also emphasized for Turkeyalso emphasized for Turkey as the quality of labor as the quality of labor force is low.force is low.319 As it is underlined by Necdet Serin, the mentioned vi-As it is underlined by Necdet Serin, the mentioned vi-cious circle is also valid at the micro level.cious circle is also valid at the micro level.320 In line with the goal of in-In line with the goal of in-creasing per capita income claims Nusret Ekin; the labor aspect, which creasing per capita income claims Nusret Ekin; the labor aspect, which was neglected tilwas neglected till the 20l the 20thth century, must be paid attention henceforth.century, must be paid attention henceforth.321 For a more qualified labor force to fulfill the needs of development, a For a more qualified labor force to fulfill the needs of development, a significant amount of investments should be oriented to better off the significant amount of investments should be oriented to better off the educational and sanitary conditions.educational and sanitary conditions.322 All these approacheAll these approaches are the s are the signs of prioritizing a total development instead of obtaining a quantita-signs of prioritizing a total development instead of obtaining a quantita-tive growth ratiotive growth ratio. Indeed, i. Indeed, it is little wondert is little wonder for two reasons: First, in a for two reasons: First, in a country lacking the adequate capital, economic growth is a distant country lacking the adequate capital, economic growth is a distant dream. Second, the orthodox grdream. Second, the orthodox growth models were far away from reflect-owth models were far away from reflect-ing the realities of ing the realities of the the economy. Unless there exists economy. Unless there exists a a functionalfunctional,, institu-institu-tional and mental structure, obtaining economic growthtional and mental structure, obtaining economic growth, , though it is though it is hard to achievehard to achieve, , might only be comprised of a limited progress, for a might only be comprised of a limited progress, for a limilimited coterie. Development indeed, is a prerequisite for growth in an ted coterie. Development indeed, is a prerequisite for growth in an economy in which the social aspects are strongly embedded. The em-economy in which the social aspects are strongly embedded. The em-phasis on mentality and institutional reforms, efforts for changing the phasis on mentality and institutional reforms, efforts for changing the stationary habits, clearly reveal how stationary habits, clearly reveal how the issue ofthe issue of development development iis regard-s regard-eded preponderantlypreponderantly atat thethe locallocal academia.academia.

318 Gunnar Myrdal, “International Inequality,” inGunnar Myrdal, “International Inequality,” in PioneersPioneers, 159, 159..

319 Necdet Serin, “İnsan Gücüne Yatırım ve İktisadi KalkınmaNecdet Serin, “İnsan Gücüne Yatırım ve İktisadi Kalkınma,,” ” AÜSBFAÜSBFDD 17, no. 3 (17, no. 3 (19621962): ): 7070..

320 IbIbiidd.,., 6666--6767.. Individuals who can’t properly work can’t generate adequate Individuals who can’t properly work can’t generate adequate income. income. They can’t eat well due to low incomeThey can’t eat well due to low income,, which results in low working performance and which results in low working performance and low incomeslow incomes..

321 Nusret Nusret Ekin, “İşgücü ve Ekonomik GelişmeEkin, “İşgücü ve Ekonomik Gelişme,,”” İÜİFMİÜİFM 25, no. 125, no. 1--2 (1965): 2 (1965): 8080.. Ekin claims Ekin claims that even Marx’ term reserve army was used for an explanation fthat even Marx’ term reserve army was used for an explanation for his model, instead or his model, instead of attracting attention to unemployment.of attracting attention to unemployment.

322 Serin, “İnsan Gücüne YatırımSerin, “İnsan Gücüne Yatırım,” ,” 7373..

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§ 6.5 Concluding RemarksConcluding Remarks

It is clearly seen

It is clearly seen that the pioneers that the pioneers inin development were mostly emanat-development were mostly emanat-ed from the developed countries. However, as Gunnar Myrdal strongly ed from the developed countries. However, as Gunnar Myrdal strongly emphasizeemphasizedd, the underdeveloped co, the underdeveloped countries should generate their own untries should generate their own economistseconomists.. AAs these economists would be more familiar with the prob-s these economists would be more familiar with the prob-lems of their countries, creation of a more realistic and relevant body of lems of their countries, creation of a more realistic and relevant body of thoughtthought would be better achievedwould be better achieved..323 In case of Turkey, In case of Turkey, one can one can see see the the currentcurrent ggeneration of economists ardently engaged into the develop-eneration of economists ardently engaged into the develop-mental issues. A review on the journals provides an opportunity to see mental issues. A review on the journals provides an opportunity to see both their involvement into the existing literature and ideological stanc-both their involvement into the existing literature and ideological stanc-eses visvis--àà--visvis various theoriesvarious theories. . The The similarities and difsimilarities and differences between ferences between them and the pioneersthem and the pioneers inin development development might be might be easily easily extracted as they extracted as they simultaneously followed the literaturesimultaneously followed the literature on development economicson development economics.. Wit-Wit-nessing the main concerns and questions on their mindnessing the main concerns and questions on their mindss while concep-while concep-tualizing development, leads us atualizing development, leads us a better understanding of the actual better understanding of the actual necessities and shortcomings of Turkey for that transition period. The necessities and shortcomings of Turkey for that transition period. The emphasis onemphasis on thethe traditional ways of thinking, divergencetraditional ways of thinking, divergences from the ho-s from the ho-momo--economicus economicus mentality,mentality, the criticisms ofthe criticisms of the conspicuous consump-the conspicuous consump-tion, tion, the insithe insistent recalls about stent recalls about the immense disguised unemployment, the immense disguised unemployment, recommended recommended industrialization strategies with balanced growth and industrialization strategies with balanced growth and planning, the need planning, the need for for and limits of foreign investment, the central role and limits of foreign investment, the central role of state in provision of educational and developmental opporof state in provision of educational and developmental opportunities tunities occurred as occurred as thethe centralcentral concernsconcerns regarding this regarding this mattermatter. The presence of . The presence of such such an immense an immense archival archival material material related with therelated with the developmental as-developmental as-pects reflects both the urgency of the issue and the enthusiasm or faith pects reflects both the urgency of the issue and the enthusiasm or faith of the academics for aof the academics for a prospectiveprospective advanced socioadvanced socio--economic change in economic change in Turkey.Turkey.

323 Meier, “The Formative Period,” in Meier, “The Formative Period,” in PioneersPioneers, 19, 19..

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For the theoretical standpoints, it is clearly seen that the orthodox

For the theoretical standpoints, it is clearly seen that the orthodox approach approach wawas not taken into consideration due to the incoherency of its s not taken into consideration due to the incoherency of its assumptions for the material needs of the currentassumptions for the material needs of the current eraera. This . This iis not s not unan-unan-tticipatedicipated, though. , though. Notwithstanding, a more or less contrary alternative Notwithstanding, a more or less contrary alternative like dependency theory doesn’t really seem to be adopted as well. In-like dependency theory doesn’t really seem to be adopted as well. In-deed, wdeed, witnessing the rising influence of dependency approach itnessing the rising influence of dependency approach amongamong some developing countries in Latin America, one misome developing countries in Latin America, one might expect a similar ght expect a similar vein vein wouldwould have been dominant have been dominant aallso for the Turkish experienceso for the Turkish experience. Indeed, . Indeed, it’s true that the neoit’s true that the neo--Marxist approaches Marxist approaches wewere frequently referred by re frequently referred by the academics, especially through the journal ofthe academics, especially through the journal of Ankara UniversityAnkara University. Even . Even so, so, itit can’t sacan’t saidid thathat the academics totally have taken sides with these t the academics totally have taken sides with these neoneo--Marxist approaches or dependency theory. On the contrary, what Marxist approaches or dependency theory. On the contrary, what was insistently emphasized here is the presence of a mutual benefit be-was insistently emphasized here is the presence of a mutual benefit be-tween the countries. There tween the countries. There occurred occurred a hybrid approach in this sensea hybrid approach in this sense, , the need for foreign investment in a country lacking capital was consid-the need for foreign investment in a country lacking capital was consid-ered indispensable. Although the academics were aware of the reasons, ered indispensable. Although the academics were aware of the reasons, conditions and limitations of this foreign investment; severance of trade conditions and limitations of this foreign investment; severance of trade relations was not regarded as a solutiorelations was not regarded as a solution, the faith for industrialization n, the faith for industrialization was still alive and the belief in the hopedwas still alive and the belief in the hoped--for social change was still per-for social change was still per-severed.severed.

It is known

It is known that the dependency approach also gained dominance in that the dependency approach also gained dominance in the local academia the local academia particulary in the second half ofparticulary in the second half of the 1960s; but as the 1960s; but as the time interval of this dissertation ends upthe time interval of this dissertation ends up byby the midthe mid--sixties, the rela-sixties, the rela-tive absence of dependency is worth contemplation. This might be be-tive absence of dependency is worth contemplation. This might be be-cause of the fact that the economic indicators during first half of the cause of the fact that the economic indicators during first half of the 1960s were relatively better with respect 1960s were relatively better with respect to the 1970s Turkey, as these to the 1970s Turkey, as these years referred to the easy stages of import substitution strategy. There years referred to the easy stages of import substitution strategy. There might might have have still bestill beemem a reliance on a prospective recuperation provided a reliance on a prospective recuperation provided by a big push. The references for Nurkse, Rodan and Lewis reflect the by a big push. The references for Nurkse, Rodan and Lewis reflect the central concentral concern cern which which was not sealing the borders and becoming intro-was not sealing the borders and becoming intro-verted, but focusing on solving the problem of hidden unemployment, verted, but focusing on solving the problem of hidden unemployment, which might indirectly be related with the Keynesian spiritwhich might indirectly be related with the Keynesian spirit, yet a local-, yet a local-ized version of the concepts including different essences. ized version of the concepts including different essences. More im-More im-portantly, is the portrayal of the mentality patterns in front of the de-portantly, is the portrayal of the mentality patterns in front of the de-

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sired levels of development,

sired levels of development, which proves the arguments of Duesenber-which proves the arguments of Duesenber-ry and Veblen ry and Veblen aboutabout conspicuous consumption conspicuous consumption tendencies, regardless of tendencies, regardless of the income level.the income level. Nevertheless, the impNevertheless, the implicit emphasis licit emphasis of academics of academics on on people’speople’s viewpoints regarding working life, viewpoints regarding working life, their tendency to their tendency to be content be content of what of what theythey have, have, their propensity to their propensity to lean towards a supreme powerlean towards a supreme power; ; all remind all remind the validity of the validity of Weberian arguments Weberian arguments which which establishestablisheded con-con-nections betweennections between the religious devotion and behaviours of individuals the religious devotion and behaviours of individuals regarding worldly affairs.regarding worldly affairs.

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7 The Impact of Keynesian RevolutionThe Impact of Keynesian Revolution

The theory of economics is a method rather than

The theory of economics is a method rather than a doctrine, an apparatus of the mind, a tech-a doctrine, an apparatus of the mind, a tech-nique of thinique of thinking which helps its possessors to nking which helps its possessors to draw correct conclusionsdraw correct conclusions..

–

– Keynes, 1921Keynes, 1921

his chapter concentrates on the reception of John Maynard Keynes,

his chapter concentrates on the reception of John Maynard Keynes, who left his mark on economics particularly for the period in be-who left his mark on economics particularly for the period in be-

tween the 1930s and

tween the 1930s and the the 1970s in the local acad1970s in the local academia. The translation of emia. The translation of Keynesian theory signifies one of the most important breaking points in Keynesian theory signifies one of the most important breaking points in the story presented in this dissertation, which underpins the prospec-the story presented in this dissertation, which underpins the prospec-tive paradigm shift in the production of economic knowledge. Presuma-tive paradigm shift in the production of economic knowledge. Presuma-bly, any economist wasbly, any economist was as frequently referred as Keynes for that time, as frequently referred as Keynes for that time, explicitly or implicitly. Various countries came under the influence of explicitly or implicitly. Various countries came under the influence of the Keynesian precepts via developing different modalities. And in this the Keynesian precepts via developing different modalities. And in this chapter,chapter, II intend to locate Turkey at some place among those cointend to locate Turkey at some place among those countries untries regarding the ways of regarding the ways of academics in academics in reevaluation of Keynesian theory. reevaluation of Keynesian theory. While doing this, While doing this, II would seek answers for the following questions: would seek answers for the following questions: When Keynesian theory arrived at the local academia and who were the When Keynesian theory arrived at the local academia and who were the

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agents that

agents that played the leading roles inplayed the leading roles in ththe establishment of e establishment of his his ideas? ideas? How the congruity of its precepts wHow the congruity of its precepts wasas debated by the academics in a debated by the academics in a developing country like Turkey? What difference Keynesian theory developing country like Turkey? What difference Keynesian theory made in economics teaching made in economics teaching locallylocally and what is maintainedand what is maintained//remained remained from from Keynesian Keynesian legacy?legacy?

If the story between the beginning and the end of this dissertation the story between the beginning and the end of this dissertation is is likened likened to a journey, this chapter might resemble a warning sign that to a journey, this chapter might resemble a warning sign that informs about a drastic change in the prospective roadmap, which also informs about a drastic change in the prospective roadmap, which also transforms the nature of the journey itself. So transforms the nature of the journey itself. So indeed, what Keynes did indeed, what Keynes did in economics by clarifying the divide between micro and macro, was in economics by clarifying the divide between micro and macro, was a a revolutionary change bringing along many alterations both in theoreti-revolutionary change bringing along many alterations both in theoreti-cal/practical senses and opening new avenues forcal/practical senses and opening new avenues for furtherfurther improved improved studies. His theory studies. His theory iis regars regarded among the key constituents of the new ded among the key constituents of the new mainstream that is the micro based macro approach, namely the neo-mainstream that is the micro based macro approach, namely the neo-classical synthesis and the worldwide dissemination of Paul Samuel-classical synthesis and the worldwide dissemination of Paul Samuel-son’s son’s EconomicsEconomics based on this neoclassical synthesis, transformed the based on this neoclassical synthesis, transformed the ways how the ways how the discipline of economics was conceived in many countries, discipline of economics was conceived in many countries, similar with what happened in Turkey a few years belatedly.similar with what happened in Turkey a few years belatedly.

In this chapter,

In this chapter, I wouldI would take a step back from the establishment of take a step back from the establishment of the new mainstream in the local academia by the translation of Samuel-the new mainstream in the local academia by the translation of Samuel-soson, and concentrate on the potential effectualness of Keynesian theory n, and concentrate on the potential effectualness of Keynesian theory by examining how the local academics translated the ideas of Keynes. by examining how the local academics translated the ideas of Keynes. First, the background that First, the background that laid the groundworklaid the groundwork for the emergence of for the emergence of Keynesian thought will be revealed and the dimensKeynesian thought will be revealed and the dimensions of its reception ions of its reception among various countries will be presented. Next, the economic policies among various countries will be presented. Next, the economic policies implemented in Turkey for the given periodimplemented in Turkey for the given period will be elaboratedwill be elaborated, in , in search of any Keynesian imprints. After introducing the current debates search of any Keynesian imprints. After introducing the current debates of the academics on Keyneof the academics on Keynesian theory, two local agents associated with sian theory, two local agents associated with Keynes; Sabri Ülgener from Istanbul University and Sadun Aren from Keynes; Sabri Ülgener from Istanbul University and Sadun Aren from Mülkiye, whose influence on the teaching of economics was literally Mülkiye, whose influence on the teaching of economics was literally central as they werecentral as they were thethe “teachers of teachers” and played key roles in “teachers of teachers” and played key roles in disdisposing economics onposing economics on moremore solid foundationssolid foundations will be focusedwill be focused. There-. There-fore, how these two academics translated Keynes in their Keynesian fore, how these two academics translated Keynes in their Keynesian thought inspired books andthought inspired books and which other theoretical inspirations which other theoretical inspirations

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Keynesian theory was combined by them, become even more impo

Keynesian theory was combined by them, become even more important. rtant. Consequently, Consequently, II will will contemplatecontemplate on on somesome potential reasons behind the potential reasons behind the meeting of these two agents, whose personal backgrounds, mindsets meeting of these two agents, whose personal backgrounds, mindsets and ideological stances were pretty much different, on the common and ideological stances were pretty much different, on the common ground of Keynesground of Keynesian thoughtian thought..

§ 7.1 Historical BackHistorical Backgroundground

The long nineteenth century ended by a world war that resulted in dis-

The long nineteenth century ended by a world war that resulted in dis-solution of the empires and a break down of the economic prosperity. solution of the empires and a break down of the economic prosperity. The war was characterized as a zeroThe war was characterized as a zero--sum game in which even the win-sum game in which even the win-ners of the war underwent severe economic crners of the war underwent severe economic crisis due to the great loss-isis due to the great loss-es they faced during the war. This situation increased the feelings of es they faced during the war. This situation increased the feelings of resentment, even among the triumphants of the war. Germany was resentment, even among the triumphants of the war. Germany was among the losing parties and the soamong the losing parties and the so--called peace called peace TTreaty of Versailles reaty of Versailles imposed a great burden on imposed a great burden on Germany, both in material and immaterial Germany, both in material and immaterial sensesensess. On the other hand, unlike the European countries, the US was . On the other hand, unlike the European countries, the US was experiencing a great prosperity in the aftermath of the world war. Most experiencing a great prosperity in the aftermath of the world war. Most of the European countries were indebted to US of the European countries were indebted to US whichwhich were also the were also the trade patrade partners of the country. The imbalance between the US and Eu-rtners of the country. The imbalance between the US and Eu-rope was obviously unsustainable, but this was neglected at first. rope was obviously unsustainable, but this was neglected at first. What What wawas more on the agenda in the US s more on the agenda in the US wawass a strong desire to acquire more a strong desire to acquire more wealth especially via a rush in purchasing shares. By thewealth especially via a rush in purchasing shares. By the increase in the increase in the stock market prices, many Americans from different segments of the stock market prices, many Americans from different segments of the society emerged as winners. Nevertheless, the immense sale of equities society emerged as winners. Nevertheless, the immense sale of equities created a tension on the stock markets more than created a tension on the stock markets more than theythey could bear and could bear and the situation the situation turned out to be aturned out to be a debt spiral. Finally, in debt spiral. Finally, in that that “black thurs-“black thurs-

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day”

day”,, the stock markets collapsed and thethe stock markets collapsed and the 19291929 Great Depression exer-Great Depression exer-cised cised a huge a huge influence all over the world.influence all over the world.1

Heilbroner argues that e

Heilbroner argues that economists who were in search conomists who were in search ofof a solution a solution for the depression first had to sofor the depression first had to solve the puzzle of the coexistence of in-lve the puzzle of the coexistence of in-adequte production and involuntary unemployment. The problem was adequte production and involuntary unemployment. The problem was not easy to solve through the lenses of liberal classical economics. not easy to solve through the lenses of liberal classical economics. In In Heilbroner’s words, tHeilbroner’s words, the man who found the solution was not really a he man who found the solution was not really a representatirepresentative of proletariat coming from a leftist tradition. His name ve of proletariat coming from a leftist tradition. His name was John Maynard Keynes, who was born just the same year Karl Marx was John Maynard Keynes, who was born just the same year Karl Marx dieddied2, as the son of a famous Cambridge professor of economics. He had , as the son of a famous Cambridge professor of economics. He had definitely a genius mind, overt even during his childhood;definitely a genius mind, overt even during his childhood; discovering discovering the economic meaning of interest at the age of 4.5, wondering about the economic meaning of interest at the age of 4.5, wondering about how his own brain works at the age of 6.how his own brain works at the age of 6.3 Intellectually enriched by the Intellectually enriched by the Bloomsbury Society which he was a memberBloomsbury Society which he was a member ofof and being the apple of and being the apple of

1 In order to understand the devastatingIn order to understand the devastating impact of Great Depression, the following data impact of Great Depression, the following data presented by Hpresented by Heilbroner eilbroner may provide may provide usefuluseful insightinsights: “s: “By the end of the 1930, one out By the end of the 1930, one out of four worker in Muncie in Indiana has lost his job. Most of the women working in of four worker in Muncie in Indiana has lost his job. Most of the women working in Chicago were earning less than 25 cent per hour. Almost 2000 unemployed were there Chicago were earning less than 25 cent per hour. Almost 2000 unemployed were there in the bread queuein the bread queue in Bowery in New York. Household construction was downfell by in Bowery in New York. Household construction was downfell by 95 95 percentpercent. 9 million saving account were disappeared in the air. 80000 workplace . 9 million saving account were disappeared in the air. 80000 workplace were closed down. Salaries were dissolved by 40 were closed down. Salaries were dissolved by 40 percentpercent, wages by 60 , wages by 60 percentpercent and and profit rates by 56 profit rates by 56 percentpercent. Na. National income was decreased to 75 billion dollars from 87 tional income was decreased to 75 billion dollars from 87 billion. It was 42 billion in 1931 billion. It was 42 billion in 1931 --a misery levela misery level-- and 39 billion in 1933, which meant and 39 billion in 1933, which meant that economy was fallen flat on its face. More than a half of the welfare was disappea-that economy was fallen flat on its face. More than a half of the welfare was disappea-red and average living sred and average living standards were declined to the point where it was 20 years tandards were declined to the point where it was 20 years before. There were 14 million unemployed waiting in the streetcorners and Hoovervil-before. There were 14 million unemployed waiting in the streetcorners and Hoovervil-lesles””. . Robert Robert HeilbronerHeilbroner, , İktisat Düşünürleriİktisat Düşünürleri, 219., 219.

2 Heilbroner, Heilbroner, İktisat Düşünürleriİktisat Düşünürleri, , 221. Heilbroner, 221. Heilbroner, while comparingwhile comparing Marx and Keynes, Marx and Keynes, describes Marx as the rigid, suffering and disappointed technical depictor of the describes Marx as the rigid, suffering and disappointed technical depictor of the doomsday of capitalism. Keynes, on the other hand, is portradoomsday of capitalism. Keynes, on the other hand, is portrayed yed by him by him as cheerful as cheerful and vivacous architect of applicable capitalism. Heilbroner relates Marx’s prophecy on and vivacous architect of applicable capitalism. Heilbroner relates Marx’s prophecy on the collapse of capitalism with his neurotic downfalls determining his practical life. the collapse of capitalism with his neurotic downfalls determining his practical life. Keynes’ persuasive speech that reestablishKeynes’ persuasive speech that reestablisheses the system on the system on the other is related with the other is related with his joy and victorious life.his joy and victorious life.

3 Ibid.,Ibid., 221221..

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its eye

its eye4, with great self confidenc, with great self confidence and longsightedness, he also was the e and longsightedness, he also was the one who anticipated that the Versailles Treaty would result in the re-one who anticipated that the Versailles Treaty would result in the re-surgence of autarky and militarism severely in Germany.surgence of autarky and militarism severely in Germany.5 Eventhough Eventhough he voiced against the precepts of the treaty, his objections fell on deaf he voiced against the precepts of the treaty, his objections fell on deaf ears.ears.6 In fact, most of his works were written before the Great Depres-In fact, most of his works were written before the Great Depres-sionsion;; but in 1936, Keynes revolutionised economics by writing a mas-but in 1936, Keynes revolutionised economics by writing a mas-terpiece namely terpiece namely The General Theory of EmploymentThe General Theory of Employment,, Interest and MoneyInterest and Money7,, with the challenge of transforming the profession of ewith the challenge of transforming the profession of economics.conomics.

Before elaborating on what Keynes done, it would be meaningful to

Before elaborating on what Keynes done, it would be meaningful to take a glance at the predecessors of him. Although the Great Depression take a glance at the predecessors of him. Although the Great Depression resulted in abandonment of liberalism for a while, the objections resulted in abandonment of liberalism for a while, the objections against liberalism were already existent bagainst liberalism were already existent before. The challenges posed efore. The challenges posed were mainly against the ideas of John Baptiste Saywere mainly against the ideas of John Baptiste Say8, who can be charac-, who can be charac-terized as a representative figure of terized as a representative figure of the the classical economics. Say’s claim classical economics. Say’s claim was simple: supply creates its own demand and markets clear. A Swe-was simple: supply creates its own demand and markets clear. A Swe-dish economist Kndish economist Knut Wicksell objected that by a new theory of money ut Wicksell objected that by a new theory of money

4 Ibid.,Ibid., 220220..

5 Heilbroner, Heilbroner, İktisat, İktisat, 225225..

6 Keynes was a head representative in British Treasury until he resigned after Keynes was a head representative in British Treasury until he resigned after protesting the articles related with the reparations of Versailles protesting the articles related with the reparations of Versailles AAgreement. greement. George-George-Peden. Peden. ““Keynes ve İngiliz Ekonomi PolitikasıKeynes ve İngiliz Ekonomi Politikası,” in ,” in KeynesKeynes,, ededs.s. RobertRobert BackhouBackhousese and W. and W. BradleyBradley BatemanBateman (Ankara:(Ankara:Dost Kitabevi, 2008Dost Kitabevi, 2008),), 104104..

7 The representative figure of the neoclassical synthesis Paul Samuelson’s words on this The representative figure of the neoclassical synthesis Paul Samuelson’s words on this book are book are remarkableremarkable: “It is a badly written book, poorly organized... It is arrogant, bad: “It is a badly written book, poorly organized... It is arrogant, bad--tempered, poletempered, polemical... It aboumical... It abounnds mareds mare’s ’s nest and confusions... but when finally mas-nest and confusions... but when finally mas-tered, we find its analysis to be obvious and at the same time new. In short, it is the tered, we find its analysis to be obvious and at the same time new. In short, it is the work of a genius." Markwork of a genius." Mark EyskensEyskens,, “The Influence of the Great Depression on Economic “The Influence of the Great Depression on Economic TheoryTheory,,”” İÜİFM İÜİFM 28, no. 128, no. 1--4 (1968):4 (1968): 4141..

8 John Baptiste Say John Baptiste Say wawas the author of the best seller of economic books of its period. s the author of the best seller of economic books of its period. Özveren states that althoÖzveren states that althouugh it was Adam Smith who made a successful synthesis of gh it was Adam Smith who made a successful synthesis of economic thought, Say was the one who introduced it to economic thought, Say was the one who introduced it to the world by his own inter-the world by his own inter-pretation of Smith. pretation of Smith. Özveren, “İster İstemez KarşılaştırmalıÖzveren, “İster İstemez Karşılaştırmalı,,” in ” in Türkiye’de İktisadi Türkiye’de İktisadi DüşünceDüşünce, 8. Philip Steiner mentions that rather than a detailed consideration of theo-, 8. Philip Steiner mentions that rather than a detailed consideration of theo-retical aspect, Say’s books were mostly retical aspect, Say’s books were mostly aimed foraimed for disseminatdissemination of political economy, ion of political economy, as as systematicalsystematical presentationpresentationss of the discipline. of the discipline. SteinerSteiner,, “Cours, Leçons,” in“Cours, Leçons,” in Economic Economic Reader, Reader, 7878..

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and interest, asserting that money must be generated to feed the de-

and interest, asserting that money must be generated to feed the de-mand. Richard Kahn from Cambridge emphasized on the multiplier ef-mand. Richard Kahn from Cambridge emphasized on the multiplier ef-fect by arguing that an additional increase in the purchasing power will fect by arguing that an additional increase in the purchasing power will be reproduced by the outflows, hence it would result in creation of addi-be reproduced by the outflows, hence it would result in creation of addi-tional goods and producers.tional goods and producers.9 Even in the early 1930s, Frank Knight and Even in the early 1930s, Frank Knight and A.C. Pigou were proponents of deficit spending and A.C. Pigou were proponents of deficit spending and state work pro-state work pro-grams grams in order to expand the economy.in order to expand the economy.10 However, However, the epistemological the epistemological break cbreak caame up with Keynes, who wrote a letter to Roosevelt in 1933 me up with Keynes, who wrote a letter to Roosevelt in 1933 published in published in New York TimesNew York Times, emphasizing the role of public spending , emphasizing the role of public spending ––financed by the debtsfinanced by the debts-- in increasin increasinging the purchasing power.the purchasing power.11 Briefly, Briefly, wwhat Keynes hat Keynes did,did, was to piece was to piece many fragmentary parts together and many fragmentary parts together and constitute a clear cut receipt in eliminaton of the adverse effects of the constitute a clear cut receipt in eliminaton of the adverse effects of the economic depression.economic depression.

§ 7.2 Keynesian Theory and Its Influence on the Nature of Keynesian Theory and Its Influence on the Nature of Economic AnalysisEconomic Analysis

Similar with the other economic theorists hitherto

Similar with the other economic theorists hitherto, the current agenda , the current agenda partially triggered the theory of Keynes, partially because most of the partially triggered the theory of Keynes, partially because most of the theory was already evaluated before the Great Depression. His purpose theory was already evaluated before the Great Depression. His purpose wawas to safeguard capitalisms to safeguard capitalism12 against the danger of increasing unem-against the danger of increasing unem-

9 David Laidler, “Keynes ve Modern Makroekonominin Doğuşu,” in David Laidler, “Keynes ve Modern Makroekonominin Doğuşu,” in Keynes, Keynes, 5151--56.56.

10 DavidDavid Colander,Colander, "Teaching Keynes in the 21st Ce"Teaching Keynes in the 21st Centuryntury,,"" The Journal of Economic The Journal of Economic EducationEducation 30, no. 4 (1999): 367.30, no. 4 (1999): 367.

11 IvanIvan Berend, Berend, 20. Yüzyıl Avrupa İktisat Tarihi20. Yüzyıl Avrupa İktisat Tarihi, , 9696--9797..

12 In factIn fact,, his effort to sustain the functioning of the system was regarded as a temporary his effort to sustain the functioning of the system was regarded as a temporary exigency for Ayşe Buğra. She suggests thexigency for Ayşe Buğra. She suggests that the capitalist system is unlikeableat the capitalist system is unlikeable for for KeynesKeynes, based on the moral perspective. It would eventually be surmounted. The ac-, based on the moral perspective. It would eventually be surmounted. The ac-ceptance of such an order was only dependent upon its successceptance of such an order was only dependent upon its success, , not an average level of not an average level of successsuccess,, but a great success is essential forbut a great success is essential for the acceptance and sustaithe acceptance and sustainanabilitybility of itof it. . Buğra, Buğra, İktisatçılar ve İnsanlarİktisatçılar ve İnsanlar, 269, 269..

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ployment and decreasing wea

ployment and decreasing wealth.lth.13 In a letter he wrote to Bernard Shaw, In a letter he wrote to Bernard Shaw, he claimed that the book he was writing on economic theoryhe claimed that the book he was writing on economic theory will trans-will trans-form the way of thinking on the economic problems with a revolution form the way of thinking on the economic problems with a revolution although not although not atat an instant but in the forthcoming decade.an instant but in the forthcoming decade.14 He was pret-He was pret-ty suty sure on the prospective influential re on the prospective influential power of power of tthehe General TheoryGeneral Theory and it and it was proved to be so. What was the receipt propounded against the de-was proved to be so. What was the receipt propounded against the de-pression then? Keynes asserted that as it is clarified by the economic pression then? Keynes asserted that as it is clarified by the economic facts and realities, there is no automatic safetyfacts and realities, there is no automatic safety mechanism in econom-mechanism in econom-ics.ics.15 Nothing Nothing iis automatic, especially s automatic, especially regardingregarding the savingthe saving--invesment invesment equation. In explaining why, he claims that a prudent society would re-equation. In explaining why, he claims that a prudent society would re-serve a certain amount of income for savingserve a certain amount of income for saving,, but business world is not but business world is not always inclined to expandalways inclined to expand its activities. There might be its activities. There might be severalseveral reasons reasons for that. An abundance in the market, critical international circum-for that. An abundance in the market, critical international circum-stances or inflation might result in a decrease in the incentives for in-stances or inflation might result in a decrease in the incentives for in-vestment. The possibility of crisis just layvestment. The possibility of crisis just layss ahead at this point. Foahead at this point. For him, r him, if savings if savings aare not used for investments by the business firms, the gen-re not used for investments by the business firms, the gen-eraleral level oflevel of income income would be would be lowered and economy engages into a spi-lowered and economy engages into a spi-ral of recession.ral of recession.16 Therefore, investment is portrayed as the driving Therefore, investment is portrayed as the driving

13 Richard D. Richard D. Wolff Wolff and Stephen A. Resnickand Stephen A. Resnick,, Çatışan İktisadi Teoriler: Neoklasik, Keynesçi Çatışan İktisadi Teoriler: Neoklasik, Keynesçi ve Marksçı,ve Marksçı, translated by Can Evrentranslated by Can Evren (İstanbul: İletişim Yayınları, 2016),(İstanbul: İletişim Yayınları, 2016), 140. The a140. The au-u-thors claim that, his theory was not really engaged into the aspects such as scarcity of thors claim that, his theory was not really engaged into the aspects such as scarcity of resourcesresources which which might be related to the might be related to the availabilityavailability of an immense productive power. of an immense productive power. It can be said that Keynes and Keynesians focus’ on the effective demand reflect It can be said that Keynes and Keynesians focus’ on the effective demand reflect their their concerns not only for concerns not only for tthe analytical and political objects but also for the workers. They he analytical and political objects but also for the workers. They accept that the downfall and depression periods heavily damage the workeraccept that the downfall and depression periods heavily damage the workerss and this and this is regarded as an important contribution to the policy side.is regarded as an important contribution to the policy side.

14 HeilbronerHeilbroner,, 234234, c, cited ited inin Roy Harrod, Roy Harrod, The Life of John Maynard Keynes The Life of John Maynard Keynes (New York: (New York: Augustus Kelley, 1969):Augustus Kelley, 1969): 462.462.

15 Ibid., 235. According to his view, economicsIbid., 235. According to his view, economics iis depicted as an elevator instead of a s depicted as an elevator instead of a teeter totter. It might go up, go down or remain still. The place itteeter totter. It might go up, go down or remain still. The place it remained still can remained still can both be the ground or the top floor. In other words, depression could never cure for both be the ground or the top floor. In other words, depression could never cure for itself. Economy, like a ship that is not exposed to the wind, could remain stagnant in-itself. Economy, like a ship that is not exposed to the wind, could remain stagnant in-definitely.definitely.

16 IbidIbid.,., 232. Heilbroner recalls Malthus by his imp232. Heilbroner recalls Malthus by his implication on occurrence of saving as an lication on occurrence of saving as an economic problem. This assertion was not approved by Smith, Ricardo and Mill. The economic problem. This assertion was not approved by Smith, Ricardo and Mill. The

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force of the economy. But there is uncerta

force of the economy. But there is uncertainty, instead of reliance, inher-inty, instead of reliance, inher-ent in capitalist economy.ent in capitalist economy.17 ThisThis circumstancecircumstance becomes central particu-becomes central particu-larly at times of crisis. A flood of saving is unelarly at times of crisis. A flood of saving is unexpectable at times of cri-xpectable at times of cri-sis, and interest ratesis, and interest rate, , which is the price of savingwhich is the price of saving,, cannot be decreased cannot be decreased to a lto a level that would encourage the investors make investments. In addi-evel that would encourage the investors make investments. In addi-tion, the demand side is also important in this equation. Economy pro-tion, the demand side is also important in this equation. Economy pro-duces to satisfy the demands and in times of crisis and mass unem-duces to satisfy the demands and in times of crisis and mass unem-ployment, demand is as poor as the purses of the people.ployment, demand is as poor as the purses of the people.18 Then what Then what would stimulate the investor to invest? Keynes’ answer would stimulate the investor to invest? Keynes’ answer to that to that was the was the uutilizationtilization of public spending. In order to provide the essential impulse, of public spending. In order to provide the essential impulse, public spending has to be increasedpublic spending has to be increased19 and in case the business and in case the business iis not s not able to expandable to expand by itselfby itself, stat, statee iis expecteds expected to fill the gap. to fill the gap.

Briefly, Keynesian theory can be characterized by the rejection of

Briefly, Keynesian theory can be characterized by the rejection of Say’s Law, rejection of the conventional view on the relation of saving Say’s Law, rejection of the conventional view on the relation of saving and investment and and investment and and an approval of theand an approval of the belief that governments can belief that governments can influence overainfluence overall levels of growth and employment. In fact, what Keynes ll levels of growth and employment. In fact, what Keynes longed for longed for was the prosperity of the earlier decades. was the prosperity of the earlier decades. In the opinion ofIn the opinion of Skidelsky at Warwick University, “much of Keynes’s work was motivated Skidelsky at Warwick University, “much of Keynes’s work was motivated by a desire to return to the stability and growth of the by a desire to return to the stability and growth of the prepre--1914 period 1914 period that had been shattered by the that had been shattered by the FirsFirst t WWorld orld wwar. Although the workings ar. Although the workings of the Victorian and Edwardian gold standard did a good job of this, of the Victorian and Edwardian gold standard did a good job of this,

reason is th

reason is that theat the economic realities they faced with didn’t fit the content of this as-economic realities they faced with didn’t fit the content of this as-sumption. In the period they lived in, the ones sumption. In the period they lived in, the ones that were able to savethat were able to save, , wwereere the land-the land-lords and capitalists, who also were the ones that used those savings. Hence, saving lords and capitalists, who also were the ones that used those savings. Hence, saving was swiftly used for capital accumulation and making more money. Over the years, as was swiftly used for capital accumulation and making more money. Over the years, as the distribution of wealth got better, a larger sethe distribution of wealth got better, a larger segment of society gment of society has becomehas become able to able to save. Heilbroner mentions that all these processes were not foreseen by Malthus in-save. Heilbroner mentions that all these processes were not foreseen by Malthus in-deeddeed;; but but even so, legitimated his assumptioneven so, legitimated his assumption.. Ibid., 230.Ibid., 230.

17 Ayşe Buğra also puts emphasis on Keynes’ focus on state’s role in the econoAyşe Buğra also puts emphasis on Keynes’ focus on state’s role in the economy, it was my, it was basicly the elimination of the lack of information and reducing uncertainty. Buğra, basicly the elimination of the lack of information and reducing uncertainty. Buğra, “Homo oeconomicusa karşı üç liberal: Hutchison, Knight and Keynes“Homo oeconomicusa karşı üç liberal: Hutchison, Knight and Keynes,,”” inin İktisatçılar ve İktisatçılar ve İnsanlarİnsanlar, 268., 268.

18 Heilbroner, Heilbroner, İktisat Düşünürleriİktisat Düşünürleri, 23, 236.6.

19 Ibid.,Ibid., 238238..

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they had broken down by 1919.”

they had broken down by 1919.”20 ““All these works share one underly-All these works share one underly-ing featureing feature——the ideathe idea that the interthat the internal stability of an economy (of prices nal stability of an economy (of prices and unemployment) should be prioritised above abstract principles that and unemployment) should be prioritised above abstract principles that were directed at maintaining external stability (of exchange rates or the were directed at maintaining external stability (of exchange rates or the free movement of capital, for instance) at all costs.”free movement of capital, for instance) at all costs.”21

The main impact

The main impact of Keynes, as of Keynes, as argued by argued by Hans Singer is thatHans Singer is that,, he he “moved economics from “moved economics from ‘‘monomono--economicseconomics’’ of neoclassical full employ-of neoclassical full employ-ment to ment to ‘‘duoduo--economicseconomics’’ dealing with the world of unemployment equi-dealing with the world of unemployment equi-librium and economic policylibrium and economic policy..””22 Economist Economist Robert W. Robert W. Brazelton refers to Brazelton refers to ThirThirlwall lwall who who says for Keynes that, says for Keynes that, ““HHe treated economics as a branch e treated economics as a branch of ethicsof ethics, in the Marshallian tradition, in the Marshallian tradition. Indeed, he once d. Indeed, he once describedescribed what what he drew him to economics. It was, he said, its combination of the practi-he drew him to economics. It was, he said, its combination of the practi-cal and mathematical coupled with its potentiacal and mathematical coupled with its potentiality for goodlity for good..””23 Keynes’ Keynes’ contribution discredited the idea that selfcontribution discredited the idea that self--regulated mechanism will regulated mechanism will come up with socially desirable outcomes, independent from the good come up with socially desirable outcomes, independent from the good or bad faith of the individuals. His criticism headed away from a microe-or bad faith of the individuals. His criticism headed away from a microe-conomic analysis and cconomic analysis and concluded by the vitality of intervention.oncluded by the vitality of intervention.24 By im-By im-plying such a radical transformation of the free market system, he suc-plying such a radical transformation of the free market system, he suc-ceded in changing the nature of macroeconomic policy making. ceded in changing the nature of macroeconomic policy making. It can’t It can’t be saidbe said that his revolutionary book gained widespread influence simuthat his revolutionary book gained widespread influence simul-l-taneously, but especially in the aftermath of the Second World War, its taneously, but especially in the aftermath of the Second World War, its influence dominated the economic sphere of the world, until the oil influence dominated the economic sphere of the world, until the oil shock in 1973.shock in 1973.25

20 https://www.economist.com/freehttps://www.economist.com/free--exchange/2013/11/26/aexchange/2013/11/26/a--keyneskeynes--forfor--allall--seasonsseasons

21 https://www.economist.com/freehttps://www.economist.com/free--exchange/2013/11/26/aexchange/2013/11/26/a--keyneskeynes--forfor--allall--seasonsseasons

22 Robert W. Brazelton, Robert W. Brazelton, RReview of eview of Keynes and Economic DevelopmentKeynes and Economic Development ed. ed. A.P. ThirlwallA.P. Thirlwall 1987,1987, Journal of Economic IssuesJournal of Economic Issues 22, no22, no.. 3 (sep 1988)3 (sep 1988): : 897897..

23 Ibid., 897Ibid., 897, , cited cited inin Thirlwall, 27. BuğraThirlwall, 27. Buğra also mentions that G.E. Moore, the writer of also mentions that G.E. Moore, the writer of Principia EthicaPrincipia Ethica had an everlasting influence on Keynes. For Keynes, the only sources had an everlasting influence on Keynes. For Keynes, the only sources of information under uncertainty are intuition and belief. Buğra, of information under uncertainty are intuition and belief. Buğra, İktisatçılar ve İnsan-İktisatçılar ve İnsan-lar,lar, 259259..

24 BuBuğra, ğra, İktisatçılar ve İnsanlarİktisatçılar ve İnsanlar, 267, 267..

25 Sir Roy Harrod, who wrote the biography of Keynes, asks for the reasons why Keynes’ Sir Roy Harrod, who wrote the biography of Keynes, asks for the reasons why Keynes’ message was more acceptable in the aftermath of 1945 rather than it had been just the message was more acceptable in the aftermath of 1945 rather than it had been just the

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§ 7.3 The Spread of Keynesian Ideas Across Some Industri-The Spread of Keynesian Ideas Across Some Industri-al Nationsal Nations

Following different trajectories of

Following different trajectories of the evolution of professions in vari-the evolution of professions in vari-ous countries is worth analyzing in the sense that it can portray the key ous countries is worth analyzing in the sense that it can portray the key elements of the complex governmental structures of those countries. As elements of the complex governmental structures of those countries. As Carlos IbarraCarlos Ibarra mentions about the inference in his review of Sarah Babb’s mentions about the inference in his review of Sarah Babb’s MManaging Mexicoanaging Mexico,, ““ssocial science professions reflect national systems of ocial science professions reflect national systems of institutions as well as relations between state and societyinstitutions as well as relations between state and society..””26 The evolu-The evolu-tion of the professions is shaped by the encounters and networks that tion of the professions is shaped by the encounters and networks that contribute to the theories, it can somehowcontribute to the theories, it can somehow be characterized as an im-be characterized as an im-port and export of ideas. In line with this belief, Peter Hall’s edited book, port and export of ideas. In line with this belief, Peter Hall’s edited book, which is created by State and Social Structures Committewhich is created by State and Social Structures Committeee of the Social of the Social Science Research Council is a good example of an Science Research Council is a good example of an endevaorendevaor to under-to under-stand how the stand how the economic ideas disseminate across the nations and ac-economic ideas disseminate across the nations and ac-quire impacts over policy decisions.quire impacts over policy decisions.27 While glancing at how Keynes’ While glancing at how Keynes’ ideas were received among the major industrial nations and to what ideas were received among the major industrial nations and to what extent they have become componentextent they have become componentss of their policies, of their policies, one would one would wit-wit-neness significant differences on the degree they were embraced. Alt-ss significant differences on the degree they were embraced. Alt-hough Keynesian ideas were designed in accordance with the major hough Keynesian ideas were designed in accordance with the major given advantages of industrialized countries, given advantages of industrialized countries, it can beit can be observed that the observed that the

year

year The General TheoryThe General Theory was published or beforwas published or before. His answer is mainly based on the e. His answer is mainly based on the idea that the challenge posed by the war idea that the challenge posed by the war wawas far more radical than the mass employ-s far more radical than the mass employ-mentment. . Robert Skidelsky,Robert Skidelsky, ““The Reception of the Keynesian RevolutionThe Reception of the Keynesian Revolution,” in,” in Essays on John Essays on John Maynard KeynesMaynard Keynes, , ed. Milo Keynes (Toronto: MacMillaed. Milo Keynes (Toronto: MacMillan, n, 191975),75), 110404--105.105.

26 Carlos Fiueroa IbarraCarlos Fiueroa Ibarra, review of , review of Managing Mexico: Economists from Nationalism to Managing Mexico: Economists from Nationalism to Neoliberalism, Neoliberalism, by Sarah Babb, by Sarah Babb, Journal of Latin American StudiesJournal of Latin American Studies 39, no. 239, no. 2 ((20072007):): 414166.. JSTOR, www.jstor.org/stable/4491830.JSTOR, www.jstor.org/stable/4491830.

27 PeterPeter HallHall., ed. ., ed. The PoThe Political Power of Economic Ideas: Keynesianism Across Nationslitical Power of Economic Ideas: Keynesianism Across Nations. . Princeton University Press, 1989.Princeton University Press, 1989.

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theory

theory takes on varioustakes on various meanings in the political andmeanings in the political and economic realms economic realms of the dof the distinctistinct nations.nations.28 Hall argues that the implementation of Keynes-Hall argues that the implementation of Keynes-ian ideas depend upon ian ideas depend upon subtlesubtle reversalreversals in states in state--society relations. In oth-society relations. In oth-er words, the acceptance of Keynesian policies reflects more of a politi-er words, the acceptance of Keynesian policies reflects more of a politi-cal statement, instead cal statement, instead of its usage as a technical apparatus to solve the of its usage as a technical apparatus to solve the problems generated by the depression; and that political statement is problems generated by the depression; and that political statement is about the proper borders of state behavior.about the proper borders of state behavior.29 Hall, justifies his choice of Hall, justifies his choice of Keynes by claiming that “Keynes by claiming that “hhe was the most influential economie was the most influential economist of his st of his own generation, his work left an indelible mark on modern economic own generation, his work left an indelible mark on modern economic theory… his ideas were central to major debates of economic policy, his theory… his ideas were central to major debates of economic policy, his works were read and discussed around the world, they are particularly works were read and discussed around the world, they are particularly suitable for crosssuitable for cross--national studynational study..””30

In order to make a meaningful analysis on the reception of Keynes in

In order to make a meaningful analysis on the reception of Keynes in Turkey, we first look at some of the European countries, Soviet Union, Turkey, we first look at some of the European countries, Soviet Union, Japan and Latin America. To start with the reception of him among the Japan and Latin America. To start with the reception of him among the South European countries during the interwar pSouth European countries during the interwar period, we first consider eriod, we first consider Italy Italy because we see a familiar name who was more popular than because we see a familiar name who was more popular than Keynes in Italy. It was Wilhelm Röpke. It can be said that economists in Keynes in Italy. It was Wilhelm Röpke. It can be said that economists in Italy were “intent on explaining the switch from equilibrium to cycles Italy were “intent on explaining the switch from equilibrium to cycles and were also busy tryinand were also busy trying to build a model for a regulated or corporated g to build a model for a regulated or corporated economy. Between Hayek and Keynes, they preferred Röpke and tried to economy. Between Hayek and Keynes, they preferred Röpke and tried to work out of a new neoclassical synthesis.”work out of a new neoclassical synthesis.”[[……] ] “capitalism if it is to be “capitalism if it is to be saved, needs a series of acts of public intervention conformable saved, needs a series of acts of public intervention conformable to the to the market order. According to Einmarket order. According to Einauaudi and Bresciani Turroni, the famous di and Bresciani Turroni, the famous Italian economists should be conformable in Röpke’s sense, i.e. outside Italian economists should be conformable in Röpke’s sense, i.e. outside the market.”the market.”31

28 IbidIbid., ., 44..

29 Hall, Hall, The Political PowerThe Political Power, , 1919--2020..

30 IbidIbid.,., 4242..

31 Antonio Magliulo, “The Reception of Austrian Economics in ItalyAntonio Magliulo, “The Reception of Austrian Economics in Italy,,” ” Russian Journal of Russian Journal of EconEconomics omics 44, no. 1 (2018), no. 1 (2018): 83.: 83.

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One can see the moral and political prejudices were deeply embed-

One can see the moral and political prejudices were deeply embed-ded in their vision which madeded in their vision which made them hostile to a statethem hostile to a state--led strategy.led strategy.32 ““TThe che coore identity of Italian economics is its propensity to enrich, rather re identity of Italian economics is its propensity to enrich, rather than abandon the inherited neoclassical tradition”than abandon the inherited neoclassical tradition”33 and accordingly, and accordingly, Keynes Keynes seemedseemed like an unorthodox interventionistlike an unorthodox interventionist for them.for them.34 The rela-The rela-tivtive ineffectiveness and the slow dissemination progress of Keynesian e ineffectiveness and the slow dissemination progress of Keynesian ideas are considered to be related with the hierarchical structure and ideas are considered to be related with the hierarchical structure and smsmallness of the profession. There were few influential figures that allness of the profession. There were few influential figures that think themselves as the think themselves as the promoterspromoters of the traditioof the tradition of classical econom-n of classical econom-ics such as Pareto, Pantaleoni, Eunadi and Turroni.ics such as Pareto, Pantaleoni, Eunadi and Turroni.35

The example of Italy is interesting for us because the most reputed

The example of Italy is interesting for us because the most reputed way for them is claimed to be Röpke’s way; the devotion to his way was way for them is claimed to be Röpke’s way; the devotion to his way was considered as an ideological impediment forconsidered as an ideological impediment for Keynes. Same thing can Keynes. Same thing can also be said for the 1930s Turkey. Not only his ideas, but he himself was also be said for the 1930s Turkey. Not only his ideas, but he himself was in Turkey during the second half of the interwar period, at a powerful in Turkey during the second half of the interwar period, at a powerful position in the Faculty of Economics in Istanbul University, and he was position in the Faculty of Economics in Istanbul University, and he was lecturing on thlecturing on the historical schools of economic thought. It is then very e historical schools of economic thought. It is then very understandable that Keynesian ideas just slightly touched and passed in understandable that Keynesian ideas just slightly touched and passed in Turkey in similar periods.Turkey in similar periods.

The impact and progress of Keynes’ ideas in France can be perceived

The impact and progress of Keynes’ ideas in France can be perceived as dimensionas dimensionss of a broader evolof a broader evolution of political culture, instead of a ution of political culture, instead of a Kuhnian paradigm shift. Although generally ignored in the interwar pe-Kuhnian paradigm shift. Although generally ignored in the interwar pe-riod,riod,36 it turned out to be a central element of the transformation of it turned out to be a central element of the transformation of statestate--society relations in the aftermath of the Second World Warsociety relations in the aftermath of the Second World War. French . French

32 Hall, Hall, The Political PowerThe Political Power, , 2121. For further details, see Marcello Cecco’s article in . For further details, see Marcello Cecco’s article in TheThe Political Power of Economic Ideas: Keynesianism Across NationsPolitical Power of Economic Ideas: Keynesianism Across Nations. . Princeton University Princeton University Press, 1989.Press, 1989.

33 Magliulo, “The Reception of AustriaMagliulo, “The Reception of Austriann,,” 83.” 83.

34 Hall, Hall, The Political PowerThe Political Power, 21., 21.

35 Ibid., 21.Ibid., 21.

36 Ibid.,Ibid., 20. Largentaye states that 20. Largentaye states that ssix of ix of Keynes’Keynes’ writings wwritings wereere published in French published in French between 1919 and 1933between 1919 and 1933; yet, ; yet, nnone of Keynes’one of Keynes’ furtherfurther writings were writings were publishedpublished in in be-be-tween tween the years the years 1933 and 1942.1933 and 1942. HélHélèène Largentayene Largentaye, , “Gained in Translation: The “Gained in Translation: The French Edition of The General Theory by JM KeynesFrench Edition of The General Theory by JM Keynes,,” (201” (20177)):: 2.2.

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Key

Keynesianism nesianism iis defined by Rosanvallon s defined by Rosanvallon as “the economic expression of as “the economic expression of a reformist and modernizing political cua reformist and modernizing political culltureture” in between 1945 and the ” in between 1945 and the 1950s.1950s.37 This can also be seen through the curriculThis can also be seen through the curriculaa in which in which The The Gen-Gen-eral Theoryeral Theory was given awas given an outstandingn outstanding place startinplace starting from the corre-g from the corre-sponding era. Hence, the institutions that sponding era. Hence, the institutions that were orientedwere oriented to train civil to train civil servants, were strongly servants, were strongly engaged intoengaged into Keynesian ideas.Keynesian ideas.38 However, Guil-However, Guil-herme Sampaio’s PhD thesis challenges the assertion that Keynes’ writ-herme Sampaio’s PhD thesis challenges the assertion that Keynes’ writ-ings had barely any impact in iings had barely any impact in interwar France due to nterwar France due to Keynes’ allegation Keynes’ allegation ofof French foreign policiesFrench foreign policies andand hishis decreedecree in in the First World Warthe First World War repara-repara-tions. tions. SampaioSampaio argueargues that Keyness that Keynes’’ opinions regarding reparations were opinions regarding reparations were discussed anddiscussed and had many proponentshad many proponents in the 1920s in the 1920s especially from the especially from the left. left. NeverthelessNevertheless,, he he mentions that evenmentions that even after the Wafter the World orld WWar ar IIII,, there there was neverwas never aa vvigorous Keynesian revolutionigorous Keynesian revolution in France.in France.39

In fact,

In fact, The General TheoryThe General Theory was translated by Largentayewas translated by Largentaye in 1939 in 1939 while thewhile the French edition French edition waswas published in 194published in 1942 due to the censure of 2 due to the censure of GeGerman occupation forcesrman occupation forces..40 Largentaye mentions that this translationLargentaye mentions that this translation was the last book in which Keynes himself prefaced and supervised de-was the last book in which Keynes himself prefaced and supervised de-eply.eply.41 At the end of the preface Keynes asserted that “Perhaps I can best At the end of the preface Keynes asserted that “Perhaps I can best express to French readerexpress to French readers what I claim in this s what I claim in this book by saying that in the book by saying that in the theory of production it is a final breaktheory of production it is a final break--away from the doctrines of J.B. away from the doctrines of J.B.

37 Pierre Rosanvallon, “The Development of Keynesianism in France,” in Pierre Rosanvallon, “The Development of Keynesianism in France,” in The Political The Political PowerPower, , 188188--189.189.

38 Hall, Hall, The Political PowerThe Political Power, 20., 20.

39 GGuilherme Sampaio, “The Translation, Diffusion and Reception of John Maynard uilherme Sampaio, “The Translation, Diffusion and Reception of John Maynard Keynes’s Writings in France (1920sKeynes’s Writings in France (1920s--50s)50s),,” Ph” PhDD diss. (European University Institute, diss. (European University Institute, 2016): abstract.2016): abstract.

40 Largentaye, “Gained in TranslationLargentaye, “Gained in Translation,,” 6. The author of this article is the d” 6. The author of this article is the daughter of the aughter of the French translator Jean de Largentaye. She mentions a letter of his father to Keynes in French translator Jean de Largentaye. She mentions a letter of his father to Keynes in which he wrote the following words: “which he wrote the following words: “TThe wide distribution of your work in France, by he wide distribution of your work in France, by contributing to dissipate the errors which are so deeply anchored incontributing to dissipate the errors which are so deeply anchored in the public mind, the public mind, would certainly facilitate a solution of the difficulties in the midst of which our country would certainly facilitate a solution of the difficulties in the midst of which our country is at present struggling”. (Largentaye, 31 January 1938, GTE / 3 / 49is at present struggling”. (Largentaye, 31 January 1938, GTE / 3 / 49--50) Largentaye, 1.50) Largentaye, 1.

41 Ibid., 1.Ibid., 1.

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Say and that in the theory of interest it is a return to the doctrines of

Say and that in the theory of interest it is a return to the doctrines of Montesquieu”.Montesquieu”.42

For the Scandinavian countries we again witness different recep-

For the Scandinavian countries we again witness different recep-tiontions of Keynesianism. s of Keynesianism. Based on the article of Based on the article of Pekkarinen, Pekkarinen, Hall argues Hall argues that that in Swedenin Sweden,, for instance, we see a reflationary experiment in the for instance, we see a reflationary experiment in the 1930s and in Norway, they had substantial effect on policy. On the other 1930s and in Norway, they had substantial effect on policy. On the other hand, Keynesian ideashand, Keynesian ideas are mentioned to haveare mentioned to have nono influence influence in in policypolicy makingmaking in Finlandin Finland..43

Keynesian ideas

Keynesian ideas,, became appealing for among a group of became appealing for among a group of devoted devoted followers as an attractive third wayfollowers as an attractive third way in the US “in the midst of creedal in the US “in the midst of creedal period” said Hirschman.period” said Hirschman.44 However, as the implementation possibilites However, as the implementation possibilites are bound tare bound to formation of a coalition between the divergent material o formation of a coalition between the divergent material interests of social groups, Keynesian policies can only be applied suc-interests of social groups, Keynesian policies can only be applied suc-cessfully after 1938 and the Wcessfully after 1938 and the World orld WWar ar II, as these certain periods II, as these certain periods laid laid the groundthe ground for the necessary conditions in persuasion ofor the necessary conditions in persuasion of the public to f the public to do so.do so.45

One of the most interesting reception of Keynes was in the Soviet

One of the most interesting reception of Keynes was in the Soviet Union. Although it is hard to generalize, based on Carl B. Turner’s “An Union. Although it is hard to generalize, based on Carl B. Turner’s “An Analysis of Soviet Views on J. M. Keynes”, Durham, N.N.., Duke University Analysis of Soviet Views on J. M. Keynes”, Durham, N.N.., Duke University Press, 1969., Press, 1969., NicholNicholas Balabkins argues that Keynes was misperceived as Balabkins argues that Keynes was misperceived in Soviet Union, as a profascist, by in Soviet Union, as a profascist, by dintdint of the preface of German transla-of the preface of German transla-tion of tion of thethe General TheoryGeneral Theory. It was indeed just saying that “full employ-. It was indeed just saying that “full employ-ment would be easier to achieve in totalitarian conditionsment would be easier to achieve in totalitarian conditions..””46 Yet, Yet, Balab-Balab-

42 Largentaye, “Gained in TranslationLargentaye, “Gained in Translation,” ,” 7.7.

43 Hall, Hall, The Political Power, The Political Power, 25. For further details, see Jukka Pekkarinen25. For further details, see Jukka Pekkarinen,, “Keynesianism “Keynesianism and the Scandinavian Models of Economic Policyand the Scandinavian Models of Economic Policy,,” in ” in The Political Power of Economic The Political Power of Economic IdeasIdeas, , 311311--345.345.

44 AAlbertlbert O.O. Hirschman, “How the Keynesian Revolution wasHirschman, “How the Keynesian Revolution was Exported from the United Exported from the United States, and Other Comments,” in States, and Other Comments,” in The Political Power,The Political Power, 350. 350.

45 IbidIbid.., 26. For more information , 26. For more information see see AAlbertlbert O.O. HirschmanHirschman “How Keynes Was Spread “How Keynes Was Spread from Americafrom America,,”” ChallengeChallenge 31, no.6 31, no.6 ((19881988))44––7.7. JSTOR, www.jstor.org/stable/40720419.JSTOR, www.jstor.org/stable/40720419.

46 NNicholasicholas BalabkinsBalabkins,, “A “A NoteNote on theon the SSovietoviet EEvaluationvaluation ofof J.M. KJ.M. Keynes,eynes,”” Canadian Slavonic Canadian Slavonic Papers / Revue Canadienne Des SlavistesPapers / Revue Canadienne Des Slavistes 12, no. 3 12, no. 3 ((19701970):): 343343. . www.jstor.org/stable/40866306.www.jstor.org/stable/40866306.

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kins sticks up for Keynes

kins sticks up for Keynes and mentions thatand mentions that he meant that a deflation-he meant that a deflation-ary gapary gap is easier to be closedis easier to be closed in a totalitarian society than in a society in a totalitarian society than in a society adopting the principles ofadopting the principles of laissez faire, but it was perceived as a profas-laissez faire, but it was perceived as a profas-cist cist discoursediscourse..47 In another In another article, again taking Turner’s article as a ref-article, again taking Turner’s article as a ref-erence point, it is asserted that Lenin, especially on the basis of erence point, it is asserted that Lenin, especially on the basis of The The Economic Consequences of Economic Consequences of the the PPeaceeace, appreciated Keynes’ conclusions , appreciated Keynes’ conclusions and made and made considerable rconsiderable references to Keynes in his writings.eferences to Keynes in his writings.48 Notwith-Notwith-sstanding, Keynesian theory was tanding, Keynesian theory was generally criticized. There were also generally criticized. There were also reviews before the official translation of the reviews before the official translation of the General TheoryGeneral Theory, contending , contending that Keynes had ignored or underestimated the dangers of inflation.that Keynes had ignored or underestimated the dangers of inflation.49 The official translation came in 1948The official translation came in 1948;; howevehowever, r, certain passages certain passages were were omitted such as “The authoritarian state systems today seem to solve omitted such as “The authoritarian state systems today seem to solve the problem of unemployment at the expense of efficiency and free-the problem of unemployment at the expense of efficiency and free-domdom..””50 The critiques became more severe after the translation and par-The critiques became more severe after the translation and par-ticularly throughout the Colticularly throughout the Cold War process. In the 1950s, Keynesianism d War process. In the 1950s, Keynesianism was accused of being an “ideological basis for fascism and cosmopoli-was accused of being an “ideological basis for fascism and cosmopoli-tanism, and Keynesians were the worst enemies of the working class”, tanism, and Keynesians were the worst enemies of the working class”, while Keynes was depicted as “an open ideologist of imperialist wars” while Keynes was depicted as “an open ideologist of imperialist wars” and “a and “a cynical intriguer, the trusted cynical intriguer, the trusted servant of contemporary imperial-servant of contemporary imperial-ism”ism” by a Soviet economistby a Soviet economist..51 In fact, it was not only Keynes but the In fact, it was not only Keynes but the Western economic theory that was interpreted as a tool of imperialist Western economic theory that was interpreted as a tool of imperialist coalition among institutes of economics, included the coalition among institutes of economics, included the universities.universities.52 Soviet economics was oriented toward long run growth with an empha-Soviet economics was oriented toward long run growth with an empha-sis on heavy industry, taking the differences between the developed and sis on heavy industry, taking the differences between the developed and semisemi--developed regions into account. These concerns were claimed to developed regions into account. These concerns were claimed to be unavailable in Keynes. The absenbe unavailable in Keynes. The absence of a discussion on technical pro-ce of a discussion on technical pro-

47 Ibid., 345.Ibid., 345.

48 JJ. M. Letiche, “Soviet Views on Keynes: A Review A. M. Letiche, “Soviet Views on Keynes: A Review Article Surveying the rticle Surveying the Litera-Litera-tureture,,”” Journal of Economic LiteratureJournal of Economic Literature 9, no. 2 (1971): 442. 9, no. 2 (1971): 442. www.jstor.org/stable/2721057.www.jstor.org/stable/2721057.

49 Ibid., 443.Ibid., 443.

50 Ibid., 443Ibid., 443-- 444.444.

51 Ibid., 444.Ibid., 444.

52 Ibid., 444.Ibid., 444.

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gress or capital formation in Keynes, posed a problem for the Soviets.

gress or capital formation in Keynes, posed a problem for the Soviets.53 Therefore, we can say that Soviets represent an extreme case, precisely Therefore, we can say that Soviets represent an extreme case, precisely because they also rejected the theory even during the golden age of it. because they also rejected the theory even during the golden age of it. On thOn the other hand, this affirms the fact that the reception of economic e other hand, this affirms the fact that the reception of economic ideas in a specific country has a lot to say about the political stance of ideas in a specific country has a lot to say about the political stance of that country and state society relations in it.that country and state society relations in it.

Apart from the European countries, Soviets and US, looking at a

Apart from the European countries, Soviets and US, looking at a cocountry from the far east may also be interesting. Japan was among the untry from the far east may also be interesting. Japan was among the countries in which the Keynesian ideas made very little progress until countries in which the Keynesian ideas made very little progress until the 1960s. From then on, they first became influential among the mem-the 1960s. From then on, they first became influential among the mem-bers of Economic Planning Agency which was chargbers of Economic Planning Agency which was charged with the evolve-ed with the evolve-ment of macroeconomic forecasting and national income statistics. This ment of macroeconomic forecasting and national income statistics. This is understandable in the sense that the senior economic officials were is understandable in the sense that the senior economic officials were mostly composed of administrators instead of professional economists. mostly composed of administrators instead of professional economists. For the university level, For the university level, the neoclassical synthesis became prominent in the neoclassical synthesis became prominent in Tokyo University since the 1960s.Tokyo University since the 1960s.54 From this aspectFrom this aspect,, Japan shows some Japan shows some temporal similarities with Turkey as State Planning Organization was temporal similarities with Turkey as State Planning Organization was established in 1960 and the neoclassical synthesis was existent in theestablished in 1960 and the neoclassical synthesis was existent in the textbook level in Turkey by Demir Demirgil’s translation of Samuelson textbook level in Turkey by Demir Demirgil’s translation of Samuelson in 1965.in 1965.

Lastly, it would be meaningful to focus on the Keynesian influence in

Lastly, it would be meaningful to focus on the Keynesian influence in Latin America. One of the mosts prominent agents in the spread of Latin America. One of the mosts prominent agents in the spread of Keynesian thought in Latin America was RKeynesian thought in Latin America was Raul Prebisch.aul Prebisch.55 He undertook He undertook the decisive role in shaping the economic recovery plans in Argentina in the decisive role in shaping the economic recovery plans in Argentina in a Keynesian perspective. Similar with Alvin Hansen in the US, Raul a Keynesian perspective. Similar with Alvin Hansen in the US, Raul Prebisch in Latin America can be considered as the former introducer of Prebisch in Latin America can be considered as the former introducer of Keynes. He wroteKeynes. He wrote a book namely a book namely Introduccion a KeynesIntroduccion a Keynes in 1947, six in 1947, six

53 Ibid., 445Ibid., 445..

54 Hall, Hall, The Political Power, The Political Power, 24. For 24. For further information see Eleanor Hadleyfurther information see Eleanor Hadley, “The , “The Diffusion of Keynesian Ideas in Japan” Diffusion of Keynesian Ideas in Japan” in thein the samesame book.book.

55 Prebisch Prebisch iis chosen in understanding the dissemination of Keynesianism in Latin s chosen in understanding the dissemination of Keynesianism in Latin America because he was also the Executive Secretary of the United NatioAmerica because he was also the Executive Secretary of the United Nation's Economic n's Economic Commission for Latin America and the Caribbean (ECLAC).Commission for Latin America and the Caribbean (ECLAC).

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years before Hansen’s

years before Hansen’s A Guide to KeynesA Guide to Keynes.. Notwithstanding, Prebisch was Notwithstanding, Prebisch was critical of some aspects of critical of some aspects of The General Theory of Employment, Interest The General Theory of Employment, Interest and Moneyand Money, particularly on the theory of interest and the multip, particularly on the theory of interest and the multiplier ef-lier ef-fect. The presence of that critical tone can be explained both by a differ-fect. The presence of that critical tone can be explained both by a differ-ence in the object and method of analysis. What Prebisch mainly fo-ence in the object and method of analysis. What Prebisch mainly fo-cused were the dynamics and cycle, cused were the dynamics and cycle, the the aspects that were peripheral to aspects that were peripheral to Keynes’ central concerns.Keynes’ central concerns.56 Caldente anCaldente and Vernengo claim thatd Vernengo claim that,,

Prebisch’s Keynesian influence and his rejection of some aspects

Prebisch’s Keynesian influence and his rejection of some aspects of Keynes magnum opus explains why at the same time that of Keynes magnum opus explains why at the same time that Prebisch is often described as the Latin American Keynes, he is Prebisch is often described as the Latin American Keynes, he is portrayed as concerned mainly with the longportrayed as concerned mainly with the long--runrun development development problem of Latin America and without proper consideration to problem of Latin America and without proper consideration to demand factors as fundamental determinants of output and em-demand factors as fundamental determinants of output and em-ployment.ployment.57

In fact,

In fact, the authors argue thatthe authors argue that Keynes was Keynes was primarilyprimarily concerned with an concerned with an entrepreneur economy and the decision makentrepreneur economy and the decision making ing process process under uncerta-under uncerta-inty in inty in The General TheoryThe General Theory. In this. In this respect,respect, ““the multiplier analysis ap-the multiplier analysis ap-pears in fact in a superficial and perhaps incomplete formpears in fact in a superficial and perhaps incomplete form”.”.58 Prebisch Prebisch asserassertedted that multiplier effect that multiplier effect iis not relevant for developing countries, s not relevant for developing countries, because the mabecause the main problem in these countries in problem in these countries aare already low levels of re already low levels of domestic saving.domestic saving.59 Despite the theoretical divergences, similarities Despite the theoretical divergences, similarities between his ideas and Keynes’ between his ideas and Keynes’ aare clearly seen at the policy level. He re clearly seen at the policy level. He indicateindicatedd this situation in his own words as: “Keynes has lefthis situation in his own words as: “Keynes has left practical t practical solutions that are independent of his theory.solutions that are independent of his theory..... tthese can be accepted or hese can be accepted or rejected with complete independence of his theory.”rejected with complete independence of his theory.”[[……] ] ““TThere is no here is no

56 Esteban Pérez Caldenteyy and and Matias Vernengo, Matias Vernengo, ““Reading Keynes in Buenos Aires: Reading Keynes in Buenos Aires: Prebisch and the Dynamics of CapitalismPrebisch and the Dynamics of Capitalism,”,” Cambridge Journal of EconomicsCambridge Journal of Economics 40, no.6 40, no.6 (2016): 1725.(2016): 1725.

57 IbidIbid., 1725.., 1725.

58 Ibid., 1733.Ibid., 1733.

59 IbiIbid., 1733d., 1733--1734.1734.

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contradiction between my theoretical position on which to judge Key-

contradiction between my theoretical position on which to judge Key-nes and my respect for some of his pnes and my respect for some of his practical policiesractical policies..””60

Although Prebisch’s concerns offer useful insights for the potential

Although Prebisch’s concerns offer useful insights for the potential adaptability of Keynesian theory in developing countries, one should adaptability of Keynesian theory in developing countries, one should keep in mind that reception modalities are not only dependent upon the keep in mind that reception modalities are not only dependent upon the level of development indeelevel of development indeed. The experience of Turkey might manifest d. The experience of Turkey might manifest several several similarities and differences from the developing and developed similarities and differences from the developing and developed countries due to a variety of inner dynamics. In order to reveal these countries due to a variety of inner dynamics. In order to reveal these similarities and differences, a diligent examination both in theoreticasimilarities and differences, a diligent examination both in theoretical l and practical sense is necessary. The next section would explain the pe-and practical sense is necessary. The next section would explain the pe-culiar road map of Keynesianism in Turkey, both in policy making and culiar road map of Keynesianism in Turkey, both in policy making and academic field.academic field.

§ 7.4 The Impact of Keynes on Policy Making in TurkeyThe Impact of Keynes on Policy Making in Turkey

Every country, generates its own “culture” ove

Every country, generates its own “culture” over the centuries r the centuries which, as a rule, finds its most open and selfwhich, as a rule, finds its most open and self--cognizant expres-cognizant expres-sion in the philosophical field. This culture, it must be added, un-sion in the philosophical field. This culture, it must be added, un-derpins the cultural balance between the scientific disciplines derpins the cultural balance between the scientific disciplines and those called, and those called, lato sensulato sensu, humanities., humanities.….…. cecertain concepts or rtain concepts or theoretical developments do not take root in a given country be-theoretical developments do not take root in a given country be-cause the general imprinting of the national culture is unfavour-cause the general imprinting of the national culture is unfavour-ableable..61

Ideas disseminate and are acclimatized around the world through cer-

Ideas disseminate and are acclimatized around the world through cer-tain networks. In order to analyze htain networks. In order to analyze how a theory has become accepted in ow a theory has become accepted in

60 Ibid., 1731, cIbid., 1731, cited ited inin PrebischPrebisch, “Introduccion al Curso de Dinamica Economica,” , “Introduccion al Curso de Dinamica Economica,” Revista Revista de al Facultad de Ciencias Economicasde al Facultad de Ciencias Economicas 3,3, ((191948A: 48A: 506506))..

61 GiacomoGiacomo Becattini, Becattini, ““The Dissemination of Economic IdeasThe Dissemination of Economic Ideas,”,” History of Economic IdeasHistory of Economic Ideas 2020, n, no.o. 2 (2012)2 (2012)::186186..

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a particular academic circle,

a particular academic circle, first it is essentialfirst it is essential to understand the rea-to understand the rea-sons that render the local adaptation of that theory possible and the sons that render the local adaptation of that theory possible and the linkages that linkages that lay the groundworklay the groundwork for such a process. Conversely, if a for such a process. Conversely, if a dominantdominant theory is negated in that circle, then we should again try to theory is negated in that circle, then we should again try to see the differences in the mentalities and the fractions in the network. see the differences in the mentalities and the fractions in the network. Mainly, the divergences in the perceptions and roles of the concepts Mainly, the divergences in the perceptions and roles of the concepts among different cultures, may lead to different refamong different cultures, may lead to different reflections on minds and lections on minds and result in a result in a negationnegation of a theory. The primary concerns of the local envi-of a theory. The primary concerns of the local envi-ronment mronment mightight play decisive roleplay decisive roless as well. as well.

Dissemination of a certain theory into a certain network might also

Dissemination of a certain theory into a certain network might also be considered as a collision of power between the be considered as a collision of power between the status quo and newly status quo and newly born ideas. Such a collision can be clearly seen in a developing country born ideas. Such a collision can be clearly seen in a developing country like Turkey, which represent a fruitful field in the sense that it is both like Turkey, which represent a fruitful field in the sense that it is both located in the middle of east and west, liberal democracies and social-located in the middle of east and west, liberal democracies and social-ism. Indeed, the ism. Indeed, the status quo was also borrowed from outside, as Turkey status quo was also borrowed from outside, as Turkey has not really grown its own economic tradition. This is natural, as the has not really grown its own economic tradition. This is natural, as the Ottoman Empire began to articulate in world capitalism as late as 1838. Ottoman Empire began to articulate in world capitalism as late as 1838. The rapid and reluctant articulation was lacking The rapid and reluctant articulation was lacking a solida solid ttheoretical base, heoretical base, the the Ottomans became the object of capitalism before constructing an Ottomans became the object of capitalism before constructing an intellectual transformation. The French ecole, especially Say’s writingsintellectual transformation. The French ecole, especially Say’s writings,, were influential and during the Young Turkswere influential and during the Young Turks eraera, the aim of creation of a , the aim of creation of a bourgeoisie directed thbourgeoisie directed the way they turned their faces, which was the e way they turned their faces, which was the German Historical School. That is to say, the practical concerns of the German Historical School. That is to say, the practical concerns of the governing powers were determined by governing powers were determined by the the economic ideas during that economic ideas during that times. times.

Peter Hall says that “ideas play an important role in affairs of

Peter Hall says that “ideas play an important role in affairs of state”.state”.62 In a similar vein with Hall, who emphasizes the relation be-In a similar vein with Hall, who emphasizes the relation be-tween state policies and economic ideas, tween state policies and economic ideas, I primarily intendI primarily intend to analyse to analyse the state policies and construct relationsthe state policies and construct relations, particulary by focusing on, particulary by focusing on to to what degree they might bewhat degree they might be determineddetermined underunder the influence of the domi-the influence of the domi-nant economic ideas. Keynesian ideas are very suitable for such an nant economic ideas. Keynesian ideas are very suitable for such an

62 Hall, Hall, The PoliticalThe Political PPowerower,, 44..

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analysis in the sense that together with a strong theoretical background,

analysis in the sense that together with a strong theoretical background, they were mostly utilized for the practical solutions they generate. It they were mostly utilized for the practical solutions they generate. It was obvious that was obvious that the theory regards the economic problems in the in-the theory regards the economic problems in the in-dustrial countries and the policy suggestions were shaped accordingly. dustrial countries and the policy suggestions were shaped accordingly. But can we see some policy implementations in Turkey But can we see some policy implementations in Turkey ––like the First like the First New Deal in the USNew Deal in the US63-- which might be characterized as Keynesian, evwhich might be characterized as Keynesian, even en before becoming familiar with his theory? For instance, the idea sug-before becoming familiar with his theory? For instance, the idea sug-gesting that government is expected to take the place of private sector gesting that government is expected to take the place of private sector in case the private business in case the private business iis not able to invest, occurred as a common s not able to invest, occurred as a common trend in the 1930strend in the 1930s64. Another similarity . Another similarity is on the perception of state is on the perception of state intervention. In line with Keynesian ideas, state intervention was con-intervention. In line with Keynesian ideas, state intervention was con-sidered as a part of capitalist development line; that is to say, a tempo-sidered as a part of capitalist development line; that is to say, a tempo-rary policy. Although the developmental plans were borrowed from the rary policy. Although the developmental plans were borrowed from the Soviets, Soviets, the éthe étatist policies implemented in Turkey was mostly oriented tatist policies implemented in Turkey was mostly oriented to nurture the private sector which was expected to guarantee the to nurture the private sector which was expected to guarantee the maintenance of the capitalist system.maintenance of the capitalist system.

Apart from such commonalities, it would be also meaningful to have

Apart from such commonalities, it would be also meaningful to have a look at some divergences a look at some divergences between Keynesian ideas and concrete reali-between Keynesian ideas and concrete reali-ties of Turkey. As it was previously mentioned, the primary concern of ties of Turkey. As it was previously mentioned, the primary concern of Keynes was to ensure full employment and prevent the uncertainties or Keynes was to ensure full employment and prevent the uncertainties or other causes that bring about a decline in the amount of investment. other causes that bring about a decline in the amount of investment. WithWith the intent ofthe intent of understandunderstandinging how these issues might be handled how these issues might be handled through the eyes of the government in the 1930s and through the eyes of the government in the 1930s and the the 1940s1940s, , it it would be meaningful to begin withwould be meaningful to begin with the unemployment part: Unem-the unemployment part: Unem-ployment was not regarded as a central problem of the economy duriployment was not regarded as a central problem of the economy during ng

63 In fact, the New Deal policies, initiated in 1931, are regarded as being regulatory In fact, the New Deal policies, initiated in 1931, are regarded as being regulatory in in substance substance rather thanrather than beingbeing Keynesian. Hall, Keynesian. Hall, The Political PowerThe Political Power, 14. For further i, 14. For further in-n-formation see Walter Salant’s article in the book.formation see Walter Salant’s article in the book.

64 In the book that is aimed to analyse the reception of Keynes’ ideas by the major In the book that is aimed to analyse the reception of Keynes’ ideas by the major industrialized countries, Hall also emphasizes on a similar tendency. He argues that industrialized countries, Hall also emphasizes on a similar tendency. He argues that the reflationary policies the reflationary policies duridurinngg tthe interwar he interwar yearsyears owed little to Keynes’ ideas but owed little to Keynes’ ideas but could be defined as Keynesiancould be defined as Keynesian roughlyroughly. Hall, . Hall, The Political PowerThe Political Power, , 7. However, while 7. However, while emphasizing the similar tendencies in policies, we should remember that the fear of emphasizing the similar tendencies in policies, we should remember that the fear of inflation left its mark to the 1930s inflation left its mark to the 1930s Turkey.Turkey.

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that time a

that time ass this situation this situation becomes becomes intrinsically intrinsically more visible in an in-more visible in an in-dustrialized country compared with an agricultural one. As it was pre-dustrialized country compared with an agricultural one. As it was pre-viously mentioned in the chapter regarding social poliviously mentioned in the chapter regarding social policycy, state preferred , state preferred to implement certain policies in order to implement certain policies in order to make the rural population stay to make the rural population stay in the rural areas, instead of immigrating to urban. Thin the rural areas, instead of immigrating to urban. This policy was pre-is policy was pre-sumably implemented for sumably implemented for the prevention of proletarianization. Asthe prevention of proletarianization. As long long asas proletarianization was delayed, the emergenceproletarianization was delayed, the emergence--composition of a composition of a working class working class was delayed, too; hence the unemployment problems was delayed, too; hence the unemployment problems might have been less obvious to the state’s eye. It might be understand-might have been less obvious to the state’s eye. It might be understand-able in the sense that the industrial infrastructure was still inadequate, able in the sense that the industrial infrastructure was still inadequate, although industrialization was a precedence for that time. Yalthough industrialization was a precedence for that time. Yet, a very et, a very central problem in the rural, the hidden unemployment in the agricul-central problem in the rural, the hidden unemployment in the agricul-tural sector was gone unnoticed. Although there were reports regarding tural sector was gone unnoticed. Although there were reports regarding this problem, “full employment” might not be appeared as a prior policy this problem, “full employment” might not be appeared as a prior policy field for the state. In other wordfield for the state. In other words, it might not only be the theoretical s, it might not only be the theoretical skepticism about skepticism about the the Keynesian ideas, but also the current conjunctural Keynesian ideas, but also the current conjunctural conditions that precluded the adoption of Keynesian priorities regard-conditions that precluded the adoption of Keynesian priorities regard-ing full employment in economic policy making. After all, the retarding ing full employment in economic policy making. After all, the retarding effeffect of governmental policies in formation of a working class should ect of governmental policies in formation of a working class should not be neglected in understanding the current needs.not be neglected in understanding the current needs.

The second part is the investment. For Keynes, saving is useless un-

The second part is the investment. For Keynes, saving is useless un-less it is transformed into investment. In Keynesian theory, investmless it is transformed into investment. In Keynesian theory, investment ent iis mostly made by businessman and when he mentions mostly made by businessman and when he mentionss the inadequacy the inadequacy in investment, itin investment, it isis about the reluctance of businessman to invest by dint about the reluctance of businessman to invest by dint of some certain conditions. On the other hand, in the 1930s Turkey, in-of some certain conditions. On the other hand, in the 1930s Turkey, in-vestment was mostly made by government asvestment was mostly made by government as the private sector was too the private sector was too infant to invest. Eventhough the banks aspiring to support the private infant to invest. Eventhough the banks aspiring to support the private sector investments were founded such as İş Bankası and Sanayi Maadin sector investments were founded such as İş Bankası and Sanayi Maadin Bankası, it’s hard to confront with an effective private sector investment Bankası, it’s hard to confront with an effective private sector investment that immenselthat immensely contributed to economic growth. So, in Turkey, the re-y contributed to economic growth. So, in Turkey, the re-sponsibility of investment was already taken by the state. What Keynes sponsibility of investment was already taken by the state. What Keynes also stressed on was that unless the money circulates, growth is not also stressed on was that unless the money circulates, growth is not ensured. When we think of the situation in Turkey, it was noensured. When we think of the situation in Turkey, it was not clear to t clear to what degree state was what degree state was consideringconsidering the savingthe saving--investment balance as a investment balance as a

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priority. The main source of state capital wer

priority. The main source of state capital weree the taxes, most of which the taxes, most of which were indirect. This might be a compulsory cut back for the citizens, were indirect. This might be a compulsory cut back for the citizens, which might be described as a way which might be described as a way of obligatory saving.of obligatory saving.

One last point might be

One last point might be related withrelated with the budgetary issues. The the budgetary issues. The 1930s in Turkey were the years that the reminiscents of the inflationary 1930s in Turkey were the years that the reminiscents of the inflationary memories of the war and depression made themselves evident. As it memories of the war and depression made themselves evident. As it was previously stated in the chawas previously stated in the chapter of public finance, there was a fear pter of public finance, there was a fear of budget imbalances. Balanced budget and aversion from inflation ap-of budget imbalances. Balanced budget and aversion from inflation ap-peared as primacpeared as primaciesies in state policies. A cyclical budget alternative, in state policies. A cyclical budget alternative, which suggests an increase in government spending during busts, hence which suggests an increase in government spending during busts, hence revivinreviving demand and employment g demand and employment –– parallel with Keynesian policiesparallel with Keynesian policies –– was not in great demand. As the provision of a balanced budget was was not in great demand. As the provision of a balanced budget was regarded as a prerequisite of a strong economy, it again becomes com-regarded as a prerequisite of a strong economy, it again becomes com-prehensible. Constitution of a solid economic infrastructureprehensible. Constitution of a solid economic infrastructure capable of capable of shouldering the employment was prioritized. Fabrics, capital stock, shouldering the employment was prioritized. Fabrics, capital stock, technical knowledge wtechnical knowledge wereere expected to be already prevalent before car-expected to be already prevalent before car-rying the employment policies out. All these inconsistencies made it rying the employment policies out. All these inconsistencies made it difficult to implement difficult to implement the the Keynesian poKeynesian policies as they werelicies as they were,, in a develop-in a develop-ing country like Turkey. As there existed such a disharmony between ing country like Turkey. As there existed such a disharmony between the theoretical framework of Keynes and factual realities in Turkey the theoretical framework of Keynes and factual realities in Turkey dur-dur-inging the 1930s;the 1930s; Keynesian ideas were not really on the front burner of Keynesian ideas were not really on the front burner of the economic kthe economic knowledge produced in the universities, especially for the nowledge produced in the universities, especially for the period before the Wperiod before the World War orld War II. At this point, it is worth to recallII. At this point, it is worth to recall the the impression asserted byimpression asserted by ÖzverenÖzveren,, that that the the economic thought in Turkey is economic thought in Turkey is “policy driven”.“policy driven”.65

65 Özveren, “İster İstemez KarşılaştırmalıÖzveren, “İster İstemez Karşılaştırmalı,,” in ” in Türkiye’de İktisadi Düşünce, Türkiye’de İktisadi Düşünce, 9.9.

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§ 7.5 The Reception of Keynes in AcademThe Reception of Keynes in Academic Sphere in Tur-ic Sphere in Tur-keykey

The impact

The impactss of of the the Keynesian theory through some industrialized coun-Keynesian theory through some industrialized coun-tries tries aare indicated in the previous parts. Nonetheless, the experience of re indicated in the previous parts. Nonetheless, the experience of developing countries with Keynesdeveloping countries with Keynesian thoughtian thought is less emphasized. In this is less emphasized. In this sense, an analysis onsense, an analysis on the footprints of Keynesian ideas on the academic the footprints of Keynesian ideas on the academic sphere of Turkey might contribute to the literature on reception of them sphere of Turkey might contribute to the literature on reception of them in a developing country. As theories disseminate through certain net-in a developing country. As theories disseminate through certain net-works, the reception of the theory in a particular nation would works, the reception of the theory in a particular nation would reveal reveal the dynamics of interaction, the linkages and disconnections in be-the dynamics of interaction, the linkages and disconnections in be-tween. These interactions might be reciprocal, but when we look at the tween. These interactions might be reciprocal, but when we look at the case of Turkey, this interaction represents an inquivalent exchange.case of Turkey, this interaction represents an inquivalent exchange.66 As As there was no independent economic schoothere was no independent economic school of thought in Turkey, we are l of thought in Turkey, we are confronted with a shift from the French ecole to German influence confronted with a shift from the French ecole to German influence –– a a combination of ordoliberalism and German Historical Schoolcombination of ordoliberalism and German Historical School –– based on based on practical concerns. The reason behind the nonexistence of Anglosaxon practical concerns. The reason behind the nonexistence of Anglosaxon ecole in this piecole in this picture is worth analysis. By saying that, cture is worth analysis. By saying that, II don’t mean that don’t mean that they were completely unaware of the Anglosaxon ecole, but its analyti-they were completely unaware of the Anglosaxon ecole, but its analyti-cal tools were not really appreciated especially before the Second World cal tools were not really appreciated especially before the Second World War. The neglect of this ecole might be explained by thWar. The neglect of this ecole might be explained by the e influentialinfluential presence presence ofof thethe German professors who themselves representGerman professors who themselves representeded sepa-sepa-rate standpoints. One might expect that Turkey, deprived of an inde-rate standpoints. One might expect that Turkey, deprived of an inde-pendent tradition in economic thinking, would be a “tabula rasa” for the pendent tradition in economic thinking, would be a “tabula rasa” for the encounter of various ideologies and tencounter of various ideologies and the interaction of ideas. But the he interaction of ideas. But the dominance of dominance of the the Germans seems to be an obstacle in front of other Germans seems to be an obstacle in front of other dominant flows of thought in the early years of the faculty.dominant flows of thought in the early years of the faculty.

66 Özveren, “İster İstemez KarşılaştırmalıÖzveren, “İster İstemez Karşılaştırmalı,,” 32. Özveren states that ” 32. Özveren states that KadroKadro Journal and Journal and Murat Sertel’s contributions are exceptions. Murat Sertel’s contributions are exceptions. KadroKadro provided the soul for “depeprovided the soul for “dependency” ndency” approachapproach and Murat Sertel’s and Murat Sertel’s Economic DesignEconomic Design created an impression in mathematical created an impression in mathematical economics. Ibid.,economics. Ibid., 4242--4343..

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Presence of a prudent approach against the name John Maynard

Presence of a prudent approach against the name John Maynard Keynes throughout the articles pubKeynes throughout the articles published in the 1930s and lished in the 1930s and the the 1940s in 1940s in Turkey is not a surpriseTurkey is not a surprise indeedindeed. He was the representative agent of An-. He was the representative agent of An-glosaxon economics at that times, although he himself posed a challenge glosaxon economics at that times, although he himself posed a challenge against the existing Anglosaxon traditionagainst the existing Anglosaxon tradition as wellas well..67 However, in However, in the the 1930s Tur1930s Turkey, the German Historical School and social market economy key, the German Historical School and social market economy were representing the peculiar positionwere representing the peculiar positionss of the academic thinking with of the academic thinking with respect to the orthodox mainstream approaches.respect to the orthodox mainstream approaches.68 But it is important to But it is important to note that Turkey was not an exception in this matter. note that Turkey was not an exception in this matter. Although Keynes Although Keynes has already written his masterpiecehas already written his masterpiece The General TheoryThe General Theory, he was not a , he was not a figure that simultaneously becfigure that simultaneously becaame popular, especially in the South Eu-me popular, especially in the South Eu-ropean countries till the 1950s.ropean countries till the 1950s.69 In fact, the main problematic for a de-In fact, the main problematic for a de-

67 Inspired by the methodological approaches of Marshall, Keynes brought a new way of Inspired by the methodological approaches of Marshall, Keynes brought a new way of understanding economics. understanding economics. Their topics of agenda were dTheir topics of agenda were different with his colleague ifferent with his colleague Sraffa and analytical tools utilized by Pigou and Robertson were not appreciated by Sraffa and analytical tools utilized by Pigou and Robertson were not appreciated by Keynes. For Keynes. For a a detailed information about the relations of Keynes and Cambridge detailed information about the relations of Keynes and Cambridge School, see Marcuzzo, “Keynes ve CambridgeSchool, see Marcuzzo, “Keynes ve Cambridge,,” 125” 125--127. Keynes’ mer127. Keynes’ merging point from ging point from the Anglosaxon school is presented as his reintroduction of the ideas associated with the Anglosaxon school is presented as his reintroduction of the ideas associated with Malthus and underconsumptionists which are disregarded during the evolution of the Malthus and underconsumptionists which are disregarded during the evolution of the Anglosaxon tradition. Thomas Palley, “The General TheoryAnglosaxon tradition. Thomas Palley, “The General Theory at 80: Reflecat 80: Reflections on the tions on the History and Enduring Relevance of Keynes’ EconomicsHistory and Enduring Relevance of Keynes’ Economics,,”” Investigación EconómicaInvestigación Económica 76, 76, no. 301 (2017): 90.no. 301 (2017): 90. www.jstor.org/stable/26205119.www.jstor.org/stable/26205119.

68 Since the 1880s there has been a split between the AngloSince the 1880s there has been a split between the Anglossaxon school and axon school and the the German German Historical School. ThHistorical School. The method dispute controversy resulted in the Anglosaxon school’s e method dispute controversy resulted in the Anglosaxon school’s domination on modern economics. However, the ideas represented by the German domination on modern economics. However, the ideas represented by the German School School which which wwereere ““history, critique of equilibrium, history, critique of equilibrium, institutions, institutions, social relationssocial relations,, cul-cul-ture and ture and psychologypsychology”, ”, contcontinued to pose challenges againstinued to pose challenges against thethe mainstream. Palley, mainstream. Palley, “The General “The General TheoryTheory at 80at 80,,” 89.” 89.

69 Sadun Aren also emphasized on Keynes’ lack of recognition in Italy.Sadun Aren also emphasized on Keynes’ lack of recognition in Italy. ““Sadun Aren’le Sadun Aren’le Görüşme” in Görüşme” in Sadun Aren’e Armağan Sadun Aren’e Armağan ed. by Tuncer Bulutay (Ankara: Mülkiyeliler Birliği ed. by Tuncer Bulutay (Ankara: Mülkiyeliler Birliği Vakfı Yayınları:Vakfı Yayınları: 1989), 4. On the1989), 4. On the other hand, it is also claimed that the intellectual other hand, it is also claimed that the intellectual revo-revo-lution of Keynesianism rapidly dominated the UK. In the US, althoulution of Keynesianism rapidly dominated the UK. In the US, although it became domi-gh it became domi-nant in the policy side, it was theoretically contested. And Germany was mentioned as nant in the policy side, it was theoretically contested. And Germany was mentioned as one of the countries in which the influence of the revolution was weakest and as the one of the countries in which the influence of the revolution was weakest and as the robustness of classical macroeconomics was persistent both theoreticrobustness of classical macroeconomics was persistent both theoretically and practi-ally and practi-cally. Palley,cally. Palley, “The General Theory“The General Theory at 80at 80,”,” 9797.. The Australian case The Australian case reflects a flourishing reflects a flourishing

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veloping country behind the ch

veloping country behind the choice of the path of a certain theory was oice of the path of a certain theory was the question of which theory would better fit to satisfy the needs of a the question of which theory would better fit to satisfy the needs of a developing country; a developing country which has distinct peculiar developing country; a developing country which has distinct peculiar conditions and needs? Although the German ecole did not also have a conditions and needs? Although the German ecole did not also have a lot tolot to say on this; the Anglosaxon ecole, which represented an embodi-say on this; the Anglosaxon ecole, which represented an embodi-ment of much further concerns than such developmental issues, might ment of much further concerns than such developmental issues, might have been regarded as a more remote possibility to generate solid an-have been regarded as a more remote possibility to generate solid an-swers for this question. Yet, things have started to chanswers for this question. Yet, things have started to change after the Sec-ge after the Sec-ond World War, not only in Turkey, but almost ond World War, not only in Turkey, but almost in in all over the world.all over the world.

Contemplating on the reasons behind the change after that time is

Contemplating on the reasons behind the change after that time is important. The period after the Second World War is known as the important. The period after the Second World War is known as the ggolden age of capitalism and the era of olden age of capitalism and the era of the Cold War. It was the the Cold War. It was the ggolden olden age because the European countries were engaged into a recovery pro-age because the European countries were engaged into a recovery pro-cess, economic stability became a prominent affair and Bretton Woods cess, economic stability became a prominent affair and Bretton Woods System was established with its institutions like IMF and WB. Before the System was established with its institutions like IMF and WB. Before the WWorld orld WWar ar II, eII, economic dirigism was on the rise and development pos-conomic dirigism was on the rise and development pos-sibilities made the poor countries show a tendency towardsibilities made the poor countries show a tendency towardss the eco-the eco-nomic implications of fascism. Emergence of fascism and socialism as nomic implications of fascism. Emergence of fascism and socialism as alternative ideologies of economic recovery was regarded as a threat alternative ideologies of economic recovery was regarded as a threat for for liberal democracies. Therefore, Keynesian policies gained dominance liberal democracies. Therefore, Keynesian policies gained dominance and introduction of welfare state came to agenda. and introduction of welfare state came to agenda. WithinWithin the dynamics the dynamics of the Cold War, countries were somehow obliged to take a side. Turkey of the Cold War, countries were somehow obliged to take a side. Turkey chosechose the path of the path of the the liberal democracies aliberal democracies and this convergence made nd this convergence made itself evident in the relations between Turkey and America.itself evident in the relations between Turkey and America.

It is true that the Keynesian policies shaped the economic agenda of

It is true that the Keynesian policies shaped the economic agenda of the European countries after that time but it should be kept in mind the European countries after that time but it should be kept in mind that it was an uneven process. Ththat it was an uneven process. The reception of Keynes varied from the e reception of Keynes varied from the given economic positions and politics of the countries. The disparity given economic positions and politics of the countries. The disparity

understanding of

understanding of thethe theoretical theoretical ooutlookutlook of Keynesof Keynes which allowed which allowed them to undertake them to undertake policy prescriptions that brought about full employment in 1938. “Apolicy prescriptions that brought about full employment in 1938. “Australia, 1936ustralia, 1936––1938: the Nascent Keynesian State?1938: the Nascent Keynesian State?,,”” The Power of Economic IdeasThe Power of Economic Ideas: : The Origins of The Origins of Keynesian Macroeconomic Management in Interwar AustraliaKeynesian Macroeconomic Management in Interwar Australia 19291929--39, by Alex Mill-39, by Alex Mill-mow (Canberra: ANU Press, 2010): 248.mow (Canberra: ANU Press, 2010): 248. www.jstor.org/stable/j.ctt24hdkx.15.www.jstor.org/stable/j.ctt24hdkx.15.

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became obvious particularly

became obvious particularly inin the developing countries. However, it the developing countries. However, it should be noted that Keynes can be defined rather as a pragmatist should be noted that Keynes can be defined rather as a pragmatist whose prescriwhose prescriptions might undergo some changes in case, instead of a ptions might undergo some changes in case, instead of a hardhard--edged economist. Hence, his methods were regarded as more ac-edged economist. Hence, his methods were regarded as more ac-ceptable than his theoretical framework, and Keynesianism became ceptable than his theoretical framework, and Keynesianism became open to be streched out. This helped Keynes to create followers among open to be streched out. This helped Keynes to create followers among the economists in the developing countries.the economists in the developing countries.

The reception of Keynes in Turkey corresponds to the 1950s. It was

The reception of Keynes in Turkey corresponds to the 1950s. It was not a coincidence indeed. not a coincidence indeed. ÉÉtatism was abandoned in government poli-tatism was abandoned in government poli-cies and a new bourgeoisie was recently emerging that would carry cies and a new bourgeoisie was recently emerging that would carry out out the econothe economic growth. As far as the immigration from rural areas to ur-mic growth. As far as the immigration from rural areas to ur-ban emerged as an inevitable fact, unemployment became more ban emerged as an inevitable fact, unemployment became more visible visible because the economy was still lacking the capital stock to employ those because the economy was still lacking the capital stock to employ those masses. The 1950s weremasses. The 1950s were alsoalso the years that the economic the years that the economic growth was growth was driven by the agricultural exports. There were infrastructural invest-driven by the agricultural exports. There were infrastructural invest-mentsments,, like highways and barrages,like highways and barrages, whilewhile industry was considered as industry was considered as secondary importance. Planning and a long run perspective were laid secondary importance. Planning and a long run perspective were laid aside aside despite the outloud demands ofdespite the outloud demands of thethe industrialindustrial sectorsector. The reac-. The reac-tions from the industrial sector tions from the industrial sector and even from OECDand even from OECD,, against the against the ab-ab-sence sence of plan were mostly disregarded for the sake of populist imple-of plan were mostly disregarded for the sake of populist imple-mentations. The temporary economic upturn was provided by the mentations. The temporary economic upturn was provided by the exogeneous conditions and as thexogeneous conditions and as those conditions began to change in the ose conditions began to change in the second half of the 1950s, basic structural problems became more ap-second half of the 1950s, basic structural problems became more ap-parent in the economy. The 1950s can also be characterized as a parent in the economy. The 1950s can also be characterized as a periodperiod of monetary expansion in which the credit facilities were increased of monetary expansion in which the credit facilities were increased which resultewhich resulted in inflation.d in inflation.70 In the second half of the 1950s, it was un-In the second half of the 1950s, it was un-derstood that these policies were unsustainable. In 1958, moratorium derstood that these policies were unsustainable. In 1958, moratorium was announced and a sharp devaluation of the currency followed it. The was announced and a sharp devaluation of the currency followed it. The coup d’coup d’éétattat took place in 1960; took place in 1960; it it not only changnot only changeded the gthe government, but overnment, but also the statealso the state--society relations and economic policies. State Planning society relations and economic policies. State Planning Organization was founded and a new development path, namely import Organization was founded and a new development path, namely import

70 EğEğilmez,ilmez, Değişim Sürecinde Değişim Sürecinde Türkiye, Türkiye, 143.143.

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substitution strategy was adopted as a new way of protectionism, for

substitution strategy was adopted as a new way of protectionism, for the sake of domestic industry. the sake of domestic industry.

Parallel with the world agenda, the possibilities of economic devel-rallel with the world agenda, the possibilities of economic devel-opment and argumentations on that topic became more tangible. It was opment and argumentations on that topic became more tangible. It was not the direct adaptation of Keynesian precepts. What brought Keynes not the direct adaptation of Keynesian precepts. What brought Keynes into into the the agendaagenda of the current articles publishedof the current articles published waswas probably the em-probably the em-phasis on the role of investment and usage of labor powerphasis on the role of investment and usage of labor power. . The task and The task and the structure of employment became central aspects of those published the structure of employment became central aspects of those published materials. In fact, it was not the first time the academics were engaged materials. In fact, it was not the first time the academics were engaged into Keynesian methods, tinto Keynesian methods, there were many references to him through here were many references to him through the writings of the German the writings of the German émigréémigré academics. And even before, academics. And even before, The The Economic Consequences of Economic Consequences of the the PeacePeace was translated into Ottoman Turk-was translated into Ottoman Turk-ish with Arabic letters soon after its publication in 1919.ish with Arabic letters soon after its publication in 1919.71 However, we However, we have to whave to wait for ait for 223 years to achieve the complete translation of the mas-3 years to achieve the complete translation of the mas-terpiece, terpiece, The General TheoryThe General Theory..72 The time lag between these two transla-The time lag between these two transla-tions tions is presumablyis presumably related with the content of each work. Turkey might related with the content of each work. Turkey might have felt more sympathy for the former, in which Keyhave felt more sympathy for the former, in which Keynes was criticizing nes was criticizing the economic consequences of the imposed peace agreement as the Ot-the economic consequences of the imposed peace agreement as the Ot-tomans were on the side of Germans during the World War and the re-tomans were on the side of Germans during the World War and the re-

71 Eyüp Özveren and Seven Ağır, “The Reception and Impact of Keynes’s Eyüp Özveren and Seven Ağır, “The Reception and Impact of Keynes’s The Economic The Economic Consequence of the PeaceConsequence of the Peace in Turkeyin Turkey,,” in ” in Keynes’ Economic Consequences of the Peace: A Keynes’ Economic Consequences of the Peace: A ReappraisalReappraisal, eds. Jens Hölscher and Matthias Kl, eds. Jens Hölscher and Matthias Klaes (London: Pickering and Chatto,aes (London: Pickering and Chatto, 2014), 65. Özveren and Ağır indicate that the book was among the prior ones the 2014), 65. Özveren and Ağır indicate that the book was among the prior ones the printing press has published even before the foundation of the printing press has published even before the foundation of the RRepublic. Ibid., 66. The epublic. Ibid., 66. The authors argue that some of the members of the committauthors argue that some of the members of the committee sent for Lausanne were ee sent for Lausanne were probably familiar with the book. Ibid., 75.probably familiar with the book. Ibid., 75.

72 The General TheoryThe General Theory was translated into Turkish by Asım Baltacıgil in 1959. In was translated into Turkish by Asım Baltacıgil in 1959. In the note the note of the translator section of the bookof the translator section of the book, he defines this book as a prominent pathfinder , he defines this book as a prominent pathfinder scientifiscientific work in development for both universities and statesmen after the Wc work in development for both universities and statesmen after the World orld WWar ar II, risen with a perfect balance between theory and practice.II, risen with a perfect balance between theory and practice. John Maynard John Maynard Keynes, Keynes, İstihdam, Faiz ve Para Genel Teorisiİstihdam, Faiz ve Para Genel Teorisi translated by Asım Baltacıgil (İstanbul: translated by Asım Baltacıgil (İstanbul: Fakülteler MatbaaFakülteler Matbaası, 1959). Zafersı, 1959). Zafer Toprak says that the first press of this translation Toprak says that the first press of this translation was immediately consumed away and was immediately consumed away and the the second press was printed. Toprak, “second press was printed. Toprak, “Adam Adam Smith’ten Smith’ten Maynard Maynard Keynes’eKeynes’e Türkiye’de İktisadi Düşünce,Türkiye’de İktisadi Düşünce,”” in in Aydınlanma ve Ekonomi Aydınlanma ve Ekonomi ed. Taner Berksoy (İstanbued. Taner Berksoy (İstanbul: Osmanlı Araştırma Merkezi Yayını, 2009): 30l: Osmanlı Araştırma Merkezi Yayını, 2009): 30--31.31.

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cent war memories were still alive. On the other hand,

cent war memories were still alive. On the other hand, The General The-The General The-oryory was a revolutionary book challwas a revolutionary book challenging the prevalent doctrines. That enging the prevalent doctrines. That book might not be easily received in Turkey, book might not be easily received in Turkey, due to due to the strong influence the strong influence of Germanof German émigré economists.émigré economists.

In fact, as it is mentioned in the previous paragraph, Keynes was

In fact, as it is mentioned in the previous paragraph, Keynes was recognized by the German émigré academics, but mostrecognized by the German émigré academics, but most of them were not of them were not really engaged into his theory to feel a motivation to translate/localize really engaged into his theory to feel a motivation to translate/localize the dynamics of it. This might be mainly because Wilhelm Röpke was the dynamics of it. This might be mainly because Wilhelm Röpke was reluctant to accept the ideas asserted by Keynes due to his loyalty to reluctant to accept the ideas asserted by Keynes due to his loyalty to market economics.market economics.73 Among hAmong his articles we see some references to is articles we see some references to Keynesian thought but Keynesian thought but mostly mostly in a negative mannerin a negative manner.. Neumark claims Neumark claims that Röpke’s attitude towards Keynesianism that Röpke’s attitude towards Keynesianism diddid not really change even not really change even after the publication of after the publication of The General Theory.The General Theory. Neumark, acknowledging Neumark, acknowledging Keynesian TheoKeynesian Theory in some respects, criticizes the defiance of Röpke ry in some respects, criticizes the defiance of Röpke against Keynes, claiming that Röpke was an impenitent liberalagainst Keynes, claiming that Röpke was an impenitent liberal who in-who in-terpreted the modern conceptualization of fiscal theory as state sociterpreted the modern conceptualization of fiscal theory as state sociaal-l-ismism..74 At this point,At this point, a controversial questiona controversial question might occur in mimight occur in minds: how nds: how the position of Keynes the position of Keynes visvis--àà--visvis liberalism can be defined?liberalism can be defined?75 HHis struggle is struggle to sustain capitalism in line with his bourgeoise identity, reveals that to sustain capitalism in line with his bourgeoise identity, reveals that instead of being a proponent of permanent dirigism, he would opt in instead of being a proponent of permanent dirigism, he would opt in favor of market economics, interfavor of market economics, intervened by state when necessary.vened by state when necessary.76

73 Röpke and Rüstow Röpke and Rüstow werewere among the participants among the participants of Walter Lipmann Cof Walter Lipmann Colloqueolloque that is that is the seed for neoliberalismthe seed for neoliberalism. Even so, it should be noted that Röpke’s and Rüstow’s ideas . Even so, it should be noted that Röpke’s and Rüstow’s ideas diverge from the laissezdiverge from the laissez--faire lfaire liberalism and converge to social market economy.iberalism and converge to social market economy. On On the other hand, Neumark from the the other hand, Neumark from the “P“Public ublic FFinanceinance”” desk, received Keynes different desk, received Keynes different from them, from them, probablyprobably because fiscal policies were central to Keynesian approach. Ercan because fiscal policies were central to Keynesian approach. Ercan Eren argues that Röpke was close to Eren argues that Röpke was close to Keynesian approaches in Keynes’ Keynesian approaches in Keynes’ A Treatise on A Treatise on MoneyMoney, while the criticisms were more apparent in later , while the criticisms were more apparent in later works. Eren, “Avusturya İk-works. Eren, “Avusturya İk-tisadından” in tisadından” in Türkiye’de İktisadi Düşünce, Türkiye’de İktisadi Düşünce, 265.265.

74 Neumark, Neumark, Boğaziçine SığınanlarBoğaziçine Sığınanlar, 76., 76.

75 Ayşe Buğra implies that liberalism for Keynes was a moral category, independent from Ayşe Buğra implies that liberalism for Keynes was a moral category, independent from the functioning of the economy or economic policiethe functioning of the economy or economic policies. Buğra, s. Buğra, İktisatçılar ve İnsanlarİktisatçılar ve İnsanlar, , 256.256.

76 Maria CristinaMaria Cristina MarcuzzoMarcuzzo, “, “Keynes ve CambridgeKeynes ve Cambridge,” in,” in KeynesKeynes, ed, eds. s. Backhouse Backhouse and and BatemanBateman,, 131. 131. The author argues that in consideringThe author argues that in considering fiscal policy, social security and fiscal policy, social security and

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Despite the distance from Keynesian thought in the early years, it

Despite the distance from Keynesian thought in the early years, it can’t be said that the Turkish Academy was in the world of its own. In-can’t be said that the Turkish Academy was in the world of its own. In-deed, Turkey was sending students to study abroad which made them deed, Turkey was sending students to study abroad which made them familiar with the thefamiliar with the theories produced outside. Mostly, the students were ories produced outside. Mostly, the students were sent to Scandinavian countries, France, Germany and Sweden. There sent to Scandinavian countries, France, Germany and Sweden. There was an exception though, Cambridge. Osman Okyar, the son of Fethi Ok-was an exception though, Cambridge. Osman Okyar, the son of Fethi Ok-yar who was a close friend of Mustafa Kemal Atatürk and the prime yar who was a close friend of Mustafa Kemal Atatürk and the prime ministminister of Turkey, was sent there and became a student of Keynes. His er of Turkey, was sent there and became a student of Keynes. His PhD was PhD was based on the comparison of Keynesian Theory and the neo-based on the comparison of Keynesian Theory and the neo-classical theory which includes a part on “Türkiye Ekonomisi Bakımın-classical theory which includes a part on “Türkiye Ekonomisi Bakımın-dan Keynes Teorisi”dan Keynes Teorisi” (Keynesian Theory in regard to Turkish Economy)(Keynesian Theory in regard to Turkish Economy). . In this part Okyar presents some data on investment/national incIn this part Okyar presents some data on investment/national income ome and employment issues in Turkey and employment issues in Turkey for for revealing the assumptional revealing the assumptional boundaries of Keynesian logic in practical level, but he boundaries of Keynesian logic in practical level, but he also also suggestsuggestss that that ““the point is not only the point is not only explainingexplaining the reality; if the subject matter is the reality; if the subject matter is changingchanging that reality, Keynesian theory wthat reality, Keynesian theory would be useful.ould be useful.””77

full employment equation as bas

full employment equation as basees of welfare ss of welfare state, Keynes, primarily concentrated on tate, Keynes, primarily concentrated on full employment and partially focused on the other two aspects. The purpose of public full employment and partially focused on the other two aspects. The purpose of public spending was to balance and compansate the potential shrinkages in the private in-spending was to balance and compansate the potential shrinkages in the private in-vestment, in order to procure required level of dvestment, in order to procure required level of demand which would maintain full emand which would maintain full employment. She refers to Skidelsky’s words that “Keynes has never been a passionate employment. She refers to Skidelsky’s words that “Keynes has never been a passionate social reformist” and adds that he was much inclined to be a liberal than to be a social reformist” and adds that he was much inclined to be a liberal than to be a cham-cham-pion of state intervention. The main political messagpion of state intervention. The main political message in e in The General TheoryThe General Theory was to was to sustain a certain level of invesment. There are also some other viewpoints that stress sustain a certain level of invesment. There are also some other viewpoints that stress on the liberal vision of Keynes. Durbin, for instance claims that, Keynes as a liberal on the liberal vision of Keynes. Durbin, for instance claims that, Keynes as a liberal believed that the central problem was unemployment believed that the central problem was unemployment and once this problem is solved, and once this problem is solved, market capitalizm would restitute the allocative position. (Durbin, 1988):41. In addi-market capitalizm would restitute the allocative position. (Durbin, 1988):41. In addi-tion, Peacock asserted that the growth in public sector especially after the Second tion, Peacock asserted that the growth in public sector especially after the Second World War cannot be evaulated as a reasonable outcome World War cannot be evaulated as a reasonable outcome of the Keynesian ideas. (Pea-of the Keynesian ideas. (Pea-cock, 1993):28. Ibidcock, 1993):28. Ibid., 134. ., 134. All these argumentAll these argumentss focusing onfocusing on the liberal vein in Keynes-the liberal vein in Keynes-ian philosophy ian philosophy areare partly true. Keynes was a proponent of expansionary fiscal policy at partly true. Keynes was a proponent of expansionary fiscal policy at times of bust. Therefore, high levels of public spenditimes of bust. Therefore, high levels of public spending is not a general ruleng is not a general rule;; insteadinstead,, a a regulatory mechanism.regulatory mechanism.

77 OsmanOsman Okyar,Okyar, Neoklasik Teoriden Keynes TeorisineNeoklasik Teoriden Keynes Teorisine (İstanbul: İstanbul Üniversitesi,(İstanbul: İstanbul Üniversitesi, 1954), 84.1954), 84.

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Through

Through the the journal articlesjournal articles, even , even along along the writings of Osman Ok-the writings of Osman Ok-yaryar,, who can be identified as a liberal with Keynesian sensitivities,who can be identified as a liberal with Keynesian sensitivities,78 the the focus travelled around the question whether Keynesian Theory focus travelled around the question whether Keynesian Theory isis appli-appli-cable on developing countriescable on developing countries or not. The answer for this question was or not. The answer for this question was not positivenot positive in general termsin general terms. The theory was examined within many . The theory was examined within many aspects in the articles ofaspects in the articles of the local academics likethe local academics like Erdoğan Alkin and Atil-Erdoğan Alkin and Atil-la Karaosmanoğlu, the translated materials la Karaosmanoğlu, the translated materials ofof the the French economist French economist FrançoFrançois Perrouxis Perroux79 and Mark Eyskens from Belgium.and Mark Eyskens from Belgium.80 All these articles All these articles serveservess for justifying the implementation impossibilities of the theory. for justifying the implementation impossibilities of the theory. Beside the analysisBeside the analysis onon the inapplicability the inapplicability iin Turkey, the problems n Turkey, the problems relat-relat-ed with its ed with its theoretical structure theoretical structure wewere also analyre also analyzed. In line with Per-zed. In line with Per-roux, Karaosmanoğlu argued whether roux, Karaosmanoğlu argued whether The General TheoryThe General Theory is truly gen-is truly gen-eral or not. In other words, he interrogated whether the theory was a eral or not. In other words, he interrogated whether the theory was a specified one, belonging to a particular field of economy or not. specified one, belonging to a particular field of economy or not. The The General TheoryGeneral Theory was also critiwas also criticized as it merely reckoned with the shortcized as it merely reckoned with the short--term economic phenomena.term economic phenomena.81 The conjunctural anticipations were con-The conjunctural anticipations were con-sidered to be inadequate and the theory was charged by ignoring the sidered to be inadequate and the theory was charged by ignoring the impact of technological progress on relative prices.impact of technological progress on relative prices.82 As for the imple-As for the imple-mentation mentation possibilities, Karaosmanoğlu referred to Dillard, a famous possibilities, Karaosmanoğlu referred to Dillard, a famous Keynesian in supporting his Keynesian in supporting his argumentargument that the theory is not applicable that the theory is not applicable for less developed countries in the sense that wealth in thfor less developed countries in the sense that wealth in theese countries se countries

78 https://www.ekodialog.com/Makaleler/liberalhttps://www.ekodialog.com/Makaleler/liberal--bilimbilim--adamiadami--osmanosman--okyar.htmlokyar.html

79 François. PerrouxFrançois. Perroux,, “Genel Teorinin Umumi“Genel Teorinin Umumileştirilmesileştirilmesi,,” ” İÜİFMİÜİFM 10 10 no.no. 11--44 ((19491949).). As As Özveren indicates, Perroux presented the Keynes section of his book Özveren indicates, Perroux presented the Keynes section of his book Keynes, Schum-Keynes, Schum-peter, Marxpeter, Marx in İstanbul University.in İstanbul University.

80 MarkMark Eyskens, “The Influence of the Great Depression on Economic TheoryEyskens, “The Influence of the Great Depression on Economic Theory,,”” İÜİFM İÜİFM 28, 28, no. 1no. 1--4 4 (1968).(1968).

81 Atilla Atilla KaraosmanoğluKaraosmanoğlu, “Keynes İktisadının Bugün Kabul Edilmeyen Tarafları,” , “Keynes İktisadının Bugün Kabul Edilmeyen Tarafları,” AÜSBFAÜSBFDD 13, no.4 (1958):13, no.4 (1958):1, cited 1, cited inin Schumpeter J. ASchumpeter J. A. History of Economic Analysis. History of Economic Analysis ((New YorkNew York: : Oxford University Press, 1955Oxford University Press, 1955),), 11441144..

82 KaraosmanoğluKaraosmanoğlu, “Keynes İktisadının, “Keynes İktisadının,” ,” 22,, cited cited inin Fellner, “What is SurvivingFellner, “What is Surviving,,” ” American American Economic ReviewEconomic Review, , ((May 1957May 1957::7676).).

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is not a short

is not a short--term opportunity term opportunity sincesince the traditionalthe traditional methods methods aarere stillstill prevalent.prevalent.83

Although Keynesianism was criticized for its static character

Although Keynesianism was criticized for its static character84, it , it was not denied that there are some dynamic parts in it. The concepts of was not denied that there are some dynamic parts in it. The concepts of positive savings and expectations were acknowledged within that dy-positive savings and expectations were acknowledged within that dy-namic nature. Howevenamic nature. However, here in this article the concept of equilibrium r, here in this article the concept of equilibrium analysis analysis wawas very central and the theory s very central and the theory wawas evaluated with respect to s evaluated with respect to its convenience to the dynamic nature of equilibrium analysis. Inflation, its convenience to the dynamic nature of equilibrium analysis. Inflation, conjuncture and developmental issues conjuncture and developmental issues aare regarded as the aspre regarded as the aspects that ects that methods of dynamic analysis are strongly required.methods of dynamic analysis are strongly required. Karaosmanoğlu Karaosmanoğlu agreeagreess on Schumpeter’s assertion regarding Keynesian theory that on Schumpeter’s assertion regarding Keynesian theory that these dynamic concepts are attached to a static skeleton.these dynamic concepts are attached to a static skeleton.85 Keynes as-Keynes as-sumed that consumption spending is bound to the sumed that consumption spending is bound to the volume of national volume of national income and consumer plays a passive role here. For him, the dynamic income and consumer plays a passive role here. For him, the dynamic elements that change the total demand elements that change the total demand aare outside the spending habits re outside the spending habits of the consumers. The only dynamic constituent appears as investment of the consumers. The only dynamic constituent appears as investment

83 IIbbid.,id., 22, , citedcited inin D. Dillard, “The Influence of Keynesian Economics on Contemporary D. Dillard, “The Influence of Keynesian Economics on Contemporary ThoughtThought,,” A.E.R. ” A.E.R. ((May 1957May 1957: : 7777--8787))..

84 According to Raul Prebisch, who was ExecuAccording to Raul Prebisch, who was Executive Secretary of the United Nations tive Secretary of the United Nations Economic Commission for Latin America and the Caribbean (ECLAC), market econo-Economic Commission for Latin America and the Caribbean (ECLAC), market econo-mies were mies were extremelyextremely cyclical and economics had to be built upon the dynamic struc-cyclical and economics had to be built upon the dynamic struc-ture. ture. For him, pFor him, purely static analysis would urely static analysis would absolutely absolutely be inebe ineffective ffective in examiningin examining and and approaching approaching real world problems, real world problems, especially experienced inespecially experienced in the peripherythe periphery. The dissat-. The dissat-isfaction of Prebisch converted toisfaction of Prebisch converted to a a severesevere critique of Keynes, critique of Keynes, particulary particulary after after pub-pub-lishing lishing his his IntroductionIntroduction.. CaldenteyCaldentey and and Vernengo, Vernengo, ““Reading KeReading Keynes in Buenos Airesynes in Buenos Aires,” ,” 1731.1731.

85 Karaosmanoğlu, “Keynes İktisadının,” 3. cited in Karaosmanoğlu, “Keynes İktisadının,” 3. cited in Schumpeter, 1174.Schumpeter, 1174. Although Although Schumpeter Schumpeter makesmakes harshharsh criticisms of Keynesianismcriticisms of Keynesianism, , he agrees that the he agrees that the General Theo-General Theo-ryry has been the most has been the most notablenotable success and success and acquired acquired a a great great influeinfluence. This nce. This impactimpact is is rather rather ascribascribed to the ed to the brilliant and simplebrilliant and simple style of Keynes instead of style of Keynes instead of the the contributions contributions to economics or the analytical toolto economics or the analytical toolss the bookthe book procureprocured. Hale, E. E.d. Hale, E. E., Review of , Review of The New The New Economics; Keynes’ Influence on Theory and Public PolicyEconomics; Keynes’ Influence on Theory and Public Policy,, byby Seymour E. Harris,Seymour E. Harris, The The Southwestern Social Science QuarterlySouthwestern Social Science Quarterly 29, no. 1 29, no. 1 ((19481948): ): 6767––69, 69, www.jstor.org/stable/42865114.www.jstor.org/stable/42865114.

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for him.

for him.86 Karaosmanoğlu emphasKaraosmanoğlu emphasizeizess that there is no permanent scar-that there is no permanent scar-city for investment possibilities as the technological progress itself city for investment possibilities as the technological progress itself turned out to be an industry.turned out to be an industry.87 Within this Within this emphasisemphasis, he seems to be , he seems to be closer to Schumpeterian economic analysiscloser to Schumpeterian economic analysis at this pointat this point..

I laid emphasis

I laid emphasis on this on this article in the sense that it article in the sense that it isis a symbolic cri-a symbolic cri-tique of Keynesian theory tique of Keynesian theory which which representrepresentss a summary of other critics a summary of other critics by making references to Keynesians and anti Keynesians. What is to be by making references to Keynesians and anti Keynesians. What is to be remembered is thatremembered is that, g, given the distinctive structures in iven the distinctive structures in the the developed developed and less developed countriesand less developed countries,, Keynesian ideas were considered as inap-Keynesian ideas were considered as inap-plicable to less developed countries both because of the virtual theoret-plicable to less developed countries both because of the virtual theoret-ical incompleteness and lack of “generality”. ical incompleteness and lack of “generality”.

7.5.1 Two Keynesians in Turkey: Sabri Ülgener and Sadun ArenTwo Keynesians in Turkey: Sabri Ülgener and Sadun Aren

As As it is it is seenseen until here, the theory of Keynes has been confronted with until here, the theory of Keynes has been confronted with some reactions from the prominent academics writing in the 1930s and some reactions from the prominent academics writing in the 1930s and the the 1940s and even during the 1950s. 1940s and even during the 1950s. BesidesBesides, by the 1950s, there , by the 1950s, there oc-oc-curred curred a revival of interest for Keynes. The historical a revival of interest for Keynes. The historical conditions also conditions also allowed this interest because most of the German allowed this interest because most of the German émigréémigré economistseconomists havehave returned to their countries or went to other universities in Europe returned to their countries or went to other universities in Europe and US. The responsibility of economics education was taken over by and US. The responsibility of economics education was taken over by the Turkish academics from then the Turkish academics from then on. As the strongest barrier was dis-on. As the strongest barrier was dis-appeared for the dissemination of appeared for the dissemination of the the Anglosaxon ecole and the aca-Anglosaxon ecole and the aca-demics became familiar with Keynesianism, the growing interest en-demics became familiar with Keynesianism, the growing interest en-gendered an academic backbone and Keynesian theorygendered an academic backbone and Keynesian theory becamebecame

86 Karaosmanoğlu, Karaosmanoğlu, “Keynes İktisadının,” 9, c“Keynes İktisadının,” 9, citedited inin S. S. SchlichterSchlichter,, “The Passing of “The Passing of Keynesian EconomicsKeynesian Economics,,” ” Atlantic MonthlyAtlantic Monthly,, ((November 1957November 1957):): 141141--146146.. Schlihter assert-Schlihter assert-ed that in between the years 1929ed that in between the years 1929--1956, consumers did not limit their consumption 1956, consumers did not limit their consumption spendings byspendings by income. Credits played an important role that created a strong and dy-income. Credits played an important role that created a strong and dy-namic effect in development of economy. namic effect in development of economy.

87 Ibid., 10.Ibid., 10.

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appreciated and taught by two i

appreciated and taught by two important figures: Sabri Ülgener in Is-mportant figures: Sabri Ülgener in Is-tanbultanbul UniversityUniversity, and Sadun Aren in , and Sadun Aren in Ankara UniversityAnkara University..

The increasing affinity for Keynes might also be considered as a re-

The increasing affinity for Keynes might also be considered as a re-action to the policies of the government in the 1950s. During the Demo-action to the policies of the government in the 1950s. During the Demo-crat Party rule, a growth crat Party rule, a growth model based on agricultural export was adopt-model based on agricultural export was adopt-ed, accompanying to expansionary monetary policy by opening on the ed, accompanying to expansionary monetary policy by opening on the credit taps. Fiscal policies fell behind the monetary policcredit taps. Fiscal policies fell behind the monetary policiesies. Indeed, for . Indeed, for the first several years, economy was functioning well due to the tempthe first several years, economy was functioning well due to the tempo-o-rary relief provided by the Marshall Aid, Korean War and moderate cli-rary relief provided by the Marshall Aid, Korean War and moderate cli-matic conditions. Neverthelessmatic conditions. Nevertheless;; since 1954since 1954,, these conditions hathese conditions hadd changed. There was financial bottleneck, it became hard to borrow in changed. There was financial bottleneck, it became hard to borrow in the sense that the policy suggestions were ignored bthe sense that the policy suggestions were ignored by the governing y the governing elites. Both the domestic bourgeoisie and the OECD welites. Both the domestic bourgeoisie and the OECD wereere insisting on insisting on the necessity of plan, but plan was not a part of the government’s eco-the necessity of plan, but plan was not a part of the government’s eco-nomic agenda. The country was circling the drain and moratorium nomic agenda. The country was circling the drain and moratorium wawas s enunciated. A sharp devaluation oenunciated. A sharp devaluation of currency followed this and the eco-f currency followed this and the eco-nomic mentality underwent a transformation by the new institutional nomic mentality underwent a transformation by the new institutional framework after the framework after the coup d’etatcoup d’etat. Prioritization of fiscal policies might be . Prioritization of fiscal policies might be related with the increasing relevancy of Keynesian ideas, as the institu-related with the increasing relevancy of Keynesian ideas, as the institu-tiontional directions and state intervention into the economy again became al directions and state intervention into the economy again became central in policy making process in the following period.central in policy making process in the following period.

The changes

The changes atat policy level had also reflections on the academic policy level had also reflections on the academic teachingteaching.. ((vice versa is also true.vice versa is also true.)) One might think that the two One might think that the two agents agents appearing as the representatives of Keynesappearing as the representatives of Keynesian thoughtian thought would would presuma-presuma-bly bly share share more or less a more or less a similar ideological stance. similar ideological stance. Nevertheless,Nevertheless, they they were coming from distinct backgrounds and were coming from distinct backgrounds and were were politically diverse. politically diverse. Sabri Ülgener from Istanbul University wasSabri Ülgener from Istanbul University was a former assistant of the a former assistant of the German academics, who was born in a conservative environmentGerman academics, who was born in a conservative environment88 and and

88 Sabri Ülgener was born in dervish convent of Fatma Sultan Mosque in 1911, during when the Ottoman Empire was heading for the when the Ottoman Empire was heading for the last roundup. He developed a tendency last roundup. He developed a tendency towards towards IIslamic philosophy in this environment. He went to school in İstanbul Erkek slamic philosophy in this environment. He went to school in İstanbul Erkek Lisesi Lisesi (İstanbul Highschool) (İstanbul Highschool) and learnt German there. He was also learning Arabic and and learnt German there. He was also learning Arabic and Persian languages at home. After graduating fromPersian languages at home. After graduating from high school, he entered the Faculty high school, he entered the Faculty

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Sadun Aren in

Sadun Aren in Ankara UniversityAnkara University, was a socialist, was a socialist89 who had also organic who had also organic lineages with politics, as a member of the lineages with politics, as a member of the Workers’ Party of TurkeyWorkers’ Party of Turkey. .

Briefly speaking, Sabr

Briefly speaking, Sabri Ülgener can be characterized both as an i Ülgener can be characterized both as an economist, sociologist, historian who made use of a wide range of ana-economist, sociologist, historian who made use of a wide range of ana-lytical tools in understanding the economic mindset and morals of Tur-lytical tools in understanding the economic mindset and morals of Tur-key. In quest for understanding the formation of normative concepts key. In quest for understanding the formation of normative concepts regardinregarding the point of view of an economist, he mainly focused on the g the point of view of an economist, he mainly focused on the traditions and morals, the literary texts. Graduated from the Lawtraditions and morals, the literary texts. Graduated from the Law Facul-Facul-tyty in Istanbul University, he became assistant in the Institute of Econom-in Istanbul University, he became assistant in the Institute of Econom-ics and Sociology and worked together with the Gerics and Sociology and worked together with the German man émigré émigré aca-aca-demics such as Röpke, Neumark, Rüstow and Kessler. Ülgener became demics such as Röpke, Neumark, Rüstow and Kessler. Ülgener became associate in associate in ““Public Finance and General EconomicsPublic Finance and General Economics”” in 1941. He first in 1941. He first went to Harvard in 1945, having a chance to meet Schumpeter and Han-went to Harvard in 1945, having a chance to meet Schumpeter and Han-sen, whom hasen, whom hadd great influence on him, tgreat influence on him, then continued his studies in LSE hen continued his studies in LSE for a while before coming back to Turkey in 1948.for a while before coming back to Turkey in 1948.90 He became profes-He became profes-

of Law in Istanbul University.

of Law in Istanbul University. HHe was learning the Islamic “norm” from his father and e was learning the Islamic “norm” from his father and provisions of law in addition to a theoretical knowledge on the determination of price provisions of law in addition to a theoretical knowledge on the determination of price in free market and competition in the faculty in free market and competition in the faculty simultaneously. He was able to make simultaneously. He was able to make a a synthesis of them.synthesis of them. M.M. AcarAcar and and H. BilirH. Bilir, “Gerçek Bir Âlim, Mümtaz Bir Şahsiyet: Sabri , “Gerçek Bir Âlim, Mümtaz Bir Şahsiyet: Sabri Fehmi Ülgener,”Fehmi Ülgener,” KMÜ Sosyal ve Ekonomı̇k Araştırmalar Dergı̇si 1616,, no. no. 2626 (2014(2014): ): 115115. . AsAs he was brought up in an intellectually eclectic environment, his multidimensional he was brought up in an intellectually eclectic environment, his multidimensional visionvision becomes understandable.becomes understandable.

89 Sadun Aren started to think on philosophical issues since he was at the age of Sadun Aren started to think on philosophical issues since he was at the age of secondary school. The books he readsecondary school. The books he read,, like Hasan Ali Yücel’s like Hasan Ali Yücel’s MantıkMantık, Dante’s , Dante’s İlahi Kom-İlahi Kom-edyaedya and Hitler’s and Hitler’s KavgamKavgam (translated by Hüseyin Cahit Yalçın) made a great influence (translated by Hüseyin Cahit Yalçın) made a great influence on him.on him. After highschoolAfter highschool,, he entered Mülkiye and he was mostly influenced by Charles he entered Mülkiye and he was mostly influenced by Charles Darwin’s Darwin’s The Origin of SpeciesThe Origin of Species, which he read during his university education. Based , which he read during his university education. Based on his statement, this book made an impression on him in his orientation to socialism. on his statement, this book made an impression on him in his orientation to socialism. He alsHe also read Marx in those days. He has done internship in Ministry of Internal Affairs o read Marx in those days. He has done internship in Ministry of Internal Affairs Accounting department. In the corresponding years, fascism was collapsed and Accounting department. In the corresponding years, fascism was collapsed and a a sym-sym-pathy for Soviets was increased. Through the networks of his friendspathy for Soviets was increased. Through the networks of his friends,, he became famil-he became famil-iar witiar with Behice Boran and Kemal Ergin, subscribed to the journals like h Behice Boran and Kemal Ergin, subscribed to the journals like Yurt ve DünyaYurt ve Dünya and and AdımlarAdımlar and read the confidential manuscripts namely and read the confidential manuscripts namely ““the problems of Marxism”. the problems of Marxism”. He began to define himself He began to define himself a a Marxist from then on.Marxist from then on. Sadun Aren’e Sadun Aren’e 80. Yaş 80. Yaş ArmağanArmağanıı (Ankara: (Ankara: Mülkiyeliler Birliği Yayınları 31, Armağan Dizisi 5, 2003Mülkiyeliler Birliği Yayınları 31, Armağan Dizisi 5, 2003), 65), 65--200.200.

90 AcarAcar and and BiliBilirr, “Gerçek Bir Âlim,” 115., “Gerçek Bir Âlim,” 115.

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sor in 1951 and the dean of the faculty for twice. His book,

sor in 1951 and the dean of the faculty for twice. His book, Milli Gelir Milli Gelir İstihdam ve İktisadi Büyümeİstihdam ve İktisadi Büyüme, published in 1962, can be defined as a con-, published in 1962, can be defined as a con-veyance of tveyance of the track of these experiences on him. Inspired by the con-he track of these experiences on him. Inspired by the con-cept of “içtimai iktisat” brought forward by the German professors, and cept of “içtimai iktisat” brought forward by the German professors, and well equipped by the works of historical analysis on mentalities, Sabri well equipped by the works of historical analysis on mentalities, Sabri Ülgener drÜlgener dreew a road map for the implementation possibilw a road map for the implementation possibilities of ities of Keynesian theory to a developing country.Keynesian theory to a developing country. The other central academic figure was Sadun Aren. After graduating The other central academic figure was Sadun Aren. After graduating from Mülkiye, he was sent to Geneva to work in European Economic from Mülkiye, he was sent to Geneva to work in European Economic Commission that was affiliated to the United Nations. In the corre-Commission that was affiliated to the United Nations. In the corre-spondinsponding period, communist withholding was taking place in Turkey g period, communist withholding was taking place in Turkey and Aren extended the time by applying a faculty, he went to Cambridge and Aren extended the time by applying a faculty, he went to Cambridge and registered to a college. He enteredand registered to a college. He entered thethe BBC exam and passed it, then BBC exam and passed it, then he started to work in he started to work in the the Turkey section of BBC.Turkey section of BBC.91 He He was an academic was an academic who studied in England, worked in Public Finance High School and State who studied in England, worked in Public Finance High School and State Planning Organization, and at university in between the years 1955 and Planning Organization, and at university in between the years 1955 and 1965. Aren was a professor in Economics in Mülkiye, who had political 1965. Aren was a professor in Economics in Mülkiye, who had political connectionsconnections as well. Thisas well. This wawas presumable in the sense that the Mülkiye s presumable in the sense that the Mülkiye tradition serves to raise generations for the state bureaucracy. His mas-tradition serves to raise generations for the state bureaucracy. His mas-terpiece book called terpiece book called İstihdam, Para ve İktisadi Politikaİstihdam, Para ve İktisadi Politika written in 1956 written in 1956 was considered among the bookswas considered among the books in which thein which the Keynesian approach can Keynesian approach can bbe clearly seen.e clearly seen.92 The emphasis in this book, wasThe emphasis in this book, was oriented tooriented to the macro the macro foundationfoundationss of economics rather than the micro level analysis.of economics rather than the micro level analysis.

After the portrayal of personal and academic backgrounds of the two

After the portrayal of personal and academic backgrounds of the two significant academic figures, some questions might flassignificant academic figures, some questions might flash into minds: h into minds: What made Keynes a source of inspiration in economic analysisWhat made Keynes a source of inspiration in economic analysis bothboth for for

91 https://bianet.org/bianet/siyaset/105448https://bianet.org/bianet/siyaset/105448--sadunsadun--arenaren--inin--ozgecmisiozgecmisi

92 Zafer Toprak Zafer Toprak in a conversation in a conversation claimed that his book was considered as a fundamental claimed that his book was considered as a fundamental textbootextbookk for many years. Mahfi Eğilmez also says that this book was onefor many years. Mahfi Eğilmez also says that this book was one of the main of the main academic source for the exams during his student life and appreciates the book by academic source for the exams during his student life and appreciates the book by saying saying that that the theory was clearly expressed and it is still valid for understanding the theory was clearly expressed and it is still valid for understanding the the Keynesian economics. http://www.mahfiegilmez.com/2015/08/ekonomiKeynesian economics. http://www.mahfiegilmez.com/2015/08/ekonomi--ogrenciogrencisisi--icinicin--analitik.htmlanalitik.html

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a conservatist and

a conservatist and a a socialist? How could his methods socialist? How could his methods have have become that become that influential so as to constitute the main body of their basic academic influential so as to constitute the main body of their basic academic works and teachings? Were theyworks and teachings? Were they able to establish a Keynesian ecole able to establish a Keynesian ecole here covered with local patterns? Within which theoretical influences here covered with local patterns? Within which theoretical influences Keynesian precepts were combined? In the next sections, some possible Keynesian precepts were combined? In the next sections, some possible answers for these questionsanswers for these questions will be seekedwill be seeked. .

7.5.1.1 The Impact of Keynes on Sabri ÜThe Impact of Keynes on Sabri Ülgenerlgener

When Sabri Ülgener returned from America, Turkey was in quest of

When Sabri Ülgener returned from America, Turkey was in quest of economic policies that would both settle economic policies that would both settle the the economic problemeconomic problemss oc-oc-curred bycurred by dintdint of of the the WWorld orld WWar ar II and break down the stratified eco-II and break down the stratified eco-nomic backwardness. Given this portrayal of economnomic backwardness. Given this portrayal of economic realities in Tur-ic realities in Tur-key, Ülgener ckey, Ülgener cameame up with up with a a tooltoolboxbox that would both help that would both help understanding the dynamics of this stratification and the understanding the dynamics of this stratification and the patterns patterns that that determine the dominant economic mentality which resulted in the determine the dominant economic mentality which resulted in the backwardness. In fact, he was most influencebackwardness. In fact, he was most influenced by Max Weber’s analy-d by Max Weber’s analy-sissis93, who constructed , who constructed a a relation between the Protestan Ethics and func-relation between the Protestan Ethics and func-tioning of capitalism.tioning of capitalism.94 Ülgener tried to apply his method in under-Ülgener tried to apply his method in under-

93 Ülgener utilized the interpretation and explanation as Ülgener utilized the interpretation and explanation as they werethey were used by Weber and used by Weber and Sombart, instead of a positivist understanding as it was followed by GökalpSombart, instead of a positivist understanding as it was followed by Gökalp--Durkheim Durkheim tradition.tradition.

94 The interest of Sabri ÜlgenerThe interest of Sabri Ülgener forfor Weber Weber drewdrew ththe attention of Neumark ande attention of Neumark and Fındıkoğlu. Neumark claimed that Ülgener was interested in the sociological part of Fındıkoğlu. Neumark claimed that Ülgener was interested in the sociological part of economic science rather than economic or fiscal policies. He was attracted by the economic science rather than economic or fiscal policies. He was attracted by the works of Weber on sociology of religion and he completed them in a way.works of Weber on sociology of religion and he completed them in a way. Neumark, Neumark, BoğaziçiBoğaziçine Sığınanlar, ne Sığınanlar, 245.245. Ziyaeddin Fahri Fındıkoğlu said that he was the best ana-Ziyaeddin Fahri Fındıkoğlu said that he was the best ana-lyst and critic of Weberian thought, lyst and critic of Weberian thought, while also developing them. Orhan Tunawhile also developing them. Orhan Tuna, , ““Prof. Dr. Prof. Dr. Sabri Ülgener ve İki EseriSabri Ülgener ve İki Eseri,,”” İÜİFM İÜİFM 43, (1987): 4. There are also some works on the 43, (1987): 4. There are also some works on the congruencongruence of Weber and Keynes. Norbert Wiley asserts that meaning is important for ce of Weber and Keynes. Norbert Wiley asserts that meaning is important for each especially in “how they see capitalism and its history as embedded in constructed each especially in “how they see capitalism and its history as embedded in constructed or symbolically interactive (Blumer, 1969) meaning systems.” Weber focuses on the or symbolically interactive (Blumer, 1969) meaning systems.” Weber focuses on the early histoearly history of capitalism while Keynes, concentrates on the current situation of capi-ry of capitalism while Keynes, concentrates on the current situation of capi-

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standing the roots of economic backwardness and the mindset of a Mus-

standing the roots of economic backwardness and the mindset of a Mus-lim country by mainly focusinglim country by mainly focusing on the religious, ethical and cultural as-on the religious, ethical and cultural as-pects.pects.95 Apart from Weberian path he followed, the impact of Schum-Apart from Weberian path he followed, the impact of Schum-peter was also clearly seen on him, especially through his articles peter was also clearly seen on him, especially through his articles related with the sociology of intelligentsia and critiques of Marxism.related with the sociology of intelligentsia and critiques of Marxism.96

talism and its future. Norbert F Wiley, “The Congruence of Weber and

talism and its future. Norbert F Wiley, “The Congruence of Weber and KeynesKeynes,,”” Sociological TheorySociological Theory 1 (1983): 311 (1983): 31--32. www.jstor.org/stable/202046.32. www.jstor.org/stable/202046.

95 The seeking for meaning at the mThe seeking for meaning at the macro level in Weber is present from the analysis of acro level in Weber is present from the analysis of the religion and culture. the religion and culture. ÜlgenerÜlgener was both familiar with West and was both familiar with West and EEast, and he ex-ast, and he ex-plained the transition to capitalism from feodalism within the framework of mentality plained the transition to capitalism from feodalism within the framework of mentality change, the central role of the immatchange, the central role of the immaterial and cultural ingredients in addition to mate-erial and cultural ingredients in addition to mate-rial ones in his depth analysis on economic development based on our own dynamicsrial ones in his depth analysis on economic development based on our own dynamics, , which which made him a unique scientist. Acarmade him a unique scientist. Acar and and BilirBilir,, “Gerçek Bir Alim,“Gerçek Bir Alim,”” 114. On the other 114. On the other hand, this approach is criticized hand, this approach is criticized by Özveren. He claims that economic mindset and by Özveren. He claims that economic mindset and economic behaviors driven by the economic mindset are reproduced in aneconomic behaviors driven by the economic mindset are reproduced in an institution-institution-al framework. Therefore, mindsetal framework. Therefore, mindset basedbased approaches remain inadequate in under-approaches remain inadequate in under-standing the mentality changes. Özveren, standing the mentality changes. Özveren, ““İster İsİster İstemez Karşılaştırmalıtemez Karşılaştırmalı,,”” 3131..

96 An article he published in the aftermath of Schumpeter’s death reveals how Ülgener An article he published in the aftermath of Schumpeter’s death reveals how Ülgener approached the relation between themapproached the relation between them. He . He appreciateappreciatess Schumpeter’s Schumpeter’s contributions to contributions to economic theory. Presenting his theoretical background andeconomic theory. Presenting his theoretical background and the figures he was influ-the figures he was influ-enced by, he emphasizes that enced by, he emphasizes that SchumpeterSchumpeter had never been an imitator of them, neither had never been an imitator of them, neither the Austrian School which he came from, nor Walras. Before concluding the articlethe Austrian School which he came from, nor Walras. Before concluding the article inin which his academic fame as a social scientist and economistwhich his academic fame as a social scientist and economist isis strongly appreciated, strongly appreciated, Ülgener identifies the humane part of himÜlgener identifies the humane part of him as well. as well. Sabri Ülgener, “Joseph A. Schumpet-Sabri Ülgener, “Joseph A. Schumpet-er”, er”, İktisat Dergisiİktisat Dergisi, , 12. Ahmet Güner Sayar’s article would12. Ahmet Güner Sayar’s article would alsoalso be relevant in under-be relevant in under-standing the standing the enthusiasmenthusiasm of Ülgener of Ülgener on on Schumpeter. Schumpeter. SayarSayar claims that claims that ÜÜlgener was, on lgener was, on the one hand following the one hand following KKeynesian logic but eynesian logic but he was also he was also under the influence of a multi-under the influence of a multi-dimensidimensional climate of thought. Schumpeter was a part of that climate but, the show-onal climate of thought. Schumpeter was a part of that climate but, the show-down between “norm” down between “norm” --embraced by the basic elements of neoclassical systemembraced by the basic elements of neoclassical system-- and and concrete factual realities wconcrete factual realities wereere compelling for Schumpeter. He was pushed to reckon compelling for Schumpeter. He was pushed to reckon with Marx’s spherwith Marx’s sphere of influence due to the inconsistency between positive and norma-e of influence due to the inconsistency between positive and norma-tive economics. tive economics. Sayar argues that Sayar argues that Ülgener as a history philosopher was not able to Ülgener as a history philosopher was not able to keep himself aloof from this compulsion. In his analysis, the quest for an individual keep himself aloof from this compulsion. In his analysis, the quest for an individual who gained his real iwho gained his real identity in economic liberalism was very different from Schumpet-dentity in economic liberalism was very different from Schumpet-er’s prospective estimations. Sayar refers to a conversation that took place just ten er’s prospective estimations. Sayar refers to a conversation that took place just ten days before his death in 1983days before his death in 1983 and says that Ülgenerand says that Ülgener was thinking on an article in those was thinking on an article in those days that was relatdays that was related with the last century’s inheritance. ed with the last century’s inheritance. That inheritance for Ülgener,That inheritance for Ülgener,

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However,

However, in his textbook, we see the influence of Keynes much more in his textbook, we see the influence of Keynes much more than Schumpeter or any other economist. It was a textbook about mac-than Schumpeter or any other economist. It was a textbook about mac-roeconomics, without calling its name. As underdevelopment occurs as roeconomics, without calling its name. As underdevelopment occurs as main theme of the book, Keynes’ victory over Schumpeter might main theme of the book, Keynes’ victory over Schumpeter might be un-be un-derstandable. The two differs in their conceptualizations of growth and derstandable. The two differs in their conceptualizations of growth and development. Development for Schumpeter is considered as a takedevelopment. Development for Schumpeter is considered as a take--off off process for economy via technical innovations. Such technical innova-process for economy via technical innovations. Such technical innova-tions tions aare expected to be carried by a groupre expected to be carried by a group of entrepreneurs and Ülgen-of entrepreneurs and Ülgen-er probably have thought that such a group was noner probably have thought that such a group was non--existent in the cur-existent in the cur-rent conditions of Turkey. Instead, Keynes’ growth model was rent conditions of Turkey. Instead, Keynes’ growth model was acknowledged to provide new analytical tools such as consumption acknowledged to provide new analytical tools such as consumption function, accelerator and multiplfunction, accelerator and multiplier; hence, open to make contributions ier; hence, open to make contributions in the consideration of the issue. Keynes’ short run and static theory, in the consideration of the issue. Keynes’ short run and static theory, laid the groundlaid the ground for the possibilities for macro dynamic analysis via for the possibilities for macro dynamic analysis via these tools.these tools.97 This fixation is remarkable because as it was previously This fixation is remarkable because as it was previously mentimentioned in this chapter, the rejection of Keynesian ideas was mostly oned in this chapter, the rejection of Keynesian ideas was mostly justified on the ground of its static character. Ülgener, on the other hand, justified on the ground of its static character. Ülgener, on the other hand, approaches to the theory via highlighting the dynamic tools inside.approaches to the theory via highlighting the dynamic tools inside.

Another central issue behind Ülgener’s intere

Another central issue behind Ülgener’s interest in Keynes might be st in Keynes might be Keynes’ stress on the human characteristics. Obviously, for Ülgener, Keynes’ stress on the human characteristics. Obviously, for Ülgener, economics is rather a moral science than a natural science, which em-economics is rather a moral science than a natural science, which em-braces motives and intentions. This way of thinking is very close to the braces motives and intentions. This way of thinking is very close to the words of Keynes “economiwords of Keynes “economics deals with introspection and values… with cs deals with introspection and values… with motives, expectations, psychological uncertainties”motives, expectations, psychological uncertainties”98 The opennes of the The opennes of the future was based on the organic nature of human life that highly de-future was based on the organic nature of human life that highly de-pends on the intentions and beliefs. The Keynesian way of understand-pends on the intentions and beliefs. The Keynesian way of understand-ing ing economics might have been closer to Ülgener, especially when com-economics might have been closer to Ülgener, especially when com-pared with the marginalist theories that regard economics as if it is a pared with the marginalist theories that regard economics as if it is a

brought Keynes and Schumpeter and removed Marx.

brought Keynes and Schumpeter and removed Marx. Ahmet GünerAhmet Güner Sayar, “Sabri Sayar, “Sabri Ülgener’in Ülgener’in Bıraktığı MirasBıraktığı Miras,,” ” İÜİFMİÜİFM (198(19844): 29): 29--30.30.

97 Sabri Ülgener, “BüyümeSabri Ülgener, “Büyüme,,” in ” in MakalelerMakaleler, ed. Ahmet Güner Sayar, 392., ed. Ahmet Güner Sayar, 392.

98 RoberRobertt SkidelskySkidelsky,, “The Relevance of Keynes“The Relevance of Keynes,,”” Cambridge Journal of EconomicsCambridge Journal of Economics 35, no. 1, 35, no. 1, ((20112011): ): 3. www.jstor.org/stable/242320363. www.jstor.org/stable/24232036

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natural science. Parallel with that, according to Keynesian viewpoint

natural science. Parallel with that, according to Keynesian viewpoint ––inspired by the Marshallian approachinspired by the Marshallian approach –– the basic the basic concern of economic concern of economic policies is rather to “govern” the human nature instead of changing it. policies is rather to “govern” the human nature instead of changing it. “The wise and prudent statesmenship is exposed to some rules and lim-“The wise and prudent statesmenship is exposed to some rules and lim-itations”, says Keynes in the last part of his itations”, says Keynes in the last part of his The General TheoryThe General Theory..99 Ülgen-Ülgen-erer,, in his analysis on in his analysis on governmental power and economic theory, refers governmental power and economic theory, refers to Keynes’ argument that the success of the decision mechanism is to Keynes’ argument that the success of the decision mechanism is based on the capability of government in its estimation of how the based on the capability of government in its estimation of how the masses would react in the face of a certain impetus; before them, and masses would react in the face of a certain impetus; before them, and betterbetter than them.than them.100

More importantly, we should also mention the impact of Hansen on Ülgener during the Harvard years in a more detailed manner. Ülgener in an article he wrote after Hansen’s death implies that Hansen was repre-senting the peak of macroeconomics within a Keynesian view. He was considered as the focal point of the spread of Keynesian ideas to all over the US who played the most significant role in changing the climate of thoughts in America. His book “A Guide to Keynes” was the central vehic-le in the dissemination process. Ülgener appreciates Hansen by specif-ying that he was never just a follower of Keynes but made valuable

99 Marcuzzo,Marcuzzo, “Keynes ve Cambridge“Keynes ve Cambridge,,” in ” in Keynes, Keynes, 130130,, cited cited in in KeynesKeynes VII, 374.VII, 374.

100 Ülgener, “İktisat Teorisi ve Kuvvet FaktörüÜlgener, “İktisat Teorisi ve Kuvvet Faktörü,”,” Orhan Tuna’ya Armağan Sosyal Siyaset Orhan Tuna’ya Armağan Sosyal Siyaset KonferanslarıKonferansları, 31. , 31. bookbook, , ((İstanbulİstanbul, , 19821982),), 99--22, cited 22, cited inin J. M. KeynesJ. M. Keynes, The General Theo-, The General Theo-ryry, (1936), , (1936), 157.157. Except from the investment behavior, Keynesianism reflects structur-Except from the investment behavior, Keynesianism reflects structur-alism in a way, instead of the tradition of humanism. Keynesians assert that the func-alism in a way, instead of the tradition of humanism. Keynesians assert that the func-tioning of capitalism is directed by the inner laws of capitalism itself, included the tioning of capitalism is directed by the inner laws of capitalism itself, included the individual behavindividual behaviours of micro elements. Neoclassicals on the other hand, take the iours of micro elements. Neoclassicals on the other hand, take the micro elements as the determining factor, the free will and desires of the individual. micro elements as the determining factor, the free will and desires of the individual. For them, in order to understand how the capitalist machine works, one should focus For them, in order to understand how the capitalist machine works, one should focus on how these desiron how these desires shape human behavior, thus the structure and functioning of es shape human behavior, thus the structure and functioning of capitalism. Wolffcapitalism. Wolff and and Resnick, Resnick, Çatışan Çatışan İİktisadi Teorilerktisadi Teoriler, 43. Here we can see the similar-, 43. Here we can see the similar-ity between the viewpoints of Keynes and Ülgener. Ülgener also stresses on how the ity between the viewpoints of Keynes and Ülgener. Ülgener also stresses on how the minds are shaped by tminds are shaped by the structural realities. The determination of the desires are he structural realities. The determination of the desires are bound to be the existing traditions. Economics is regarded as a structure of relations bound to be the existing traditions. Economics is regarded as a structure of relations for Keynes, a whole that shapes the individual behaviour, Wolff for Keynes, a whole that shapes the individual behaviour, Wolff and Resnick, and Resnick, Çatışan Çatışan İktisadi, İktisadi, 139, and Ülg139, and Ülgener in most of his works shareener in most of his works sharess the same viewpoint.the same viewpoint.

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contributions to the theory by his own creative ideas.101 In fact, what Ülgener had done in Turkey can be likened to a version of what Hansen did in America. Specifying Keynes as a starting point and a skeleton, and making further contributions.

All these arguments aside, it should be mentioned that Ülgener had a comprehensive knowledge not only on Keynesian or Schumpeterian analysis but also on Marxism, and the Austrian School. Enriched by the visions of such colorful economic and sociological traditions, Ülgener became one of the first academics who embarked on teaching Keynes-ian economics at university. His book Milli Gelir, İstihdam ve İktisadi Büyüme was designed within the framework of Keynesian-Hansenian viewpoint in which the content signified the reception of Keynesian theory as a key model in accordance with the local conditions of the country. His assistant Ahmet Güner Sayar claimed that the long-termed success of the book lies behind his analysis on the conflict between “norm” and “reality”, within which the “human” part is considered as central. The historical trajectory and the human element are never dis-regarded when the model is examined in face with the realities of de-velopment and underdevelopment. As a matter of fact, the influence of the German philosophical tradition is clearly seen on him. However, the main concern for Ülgener was the discomfort by the low standards of underdevelopment. Sayar justifiably suggests that Ülgener overflowed the academic fatalism in the sense that he rejected the comfort of stuck-ing on the dominant flow of thought that arrives at a level of unliterali-ty.102 Ülgener was a pioneer economist103 in this breaking point of the era in which a new environment for the policy actors was profoundly

101 Ülgener, “Alvin H. HansenÜlgener, “Alvin H. Hansen,,” in ” in MakalelerMakaleler, 468, 468--471471..

102 Sayar, “Sabri Ülgener’in Bıraktığı MirasSayar, “Sabri Ülgener’in Bıraktığı Miras,,”” 2727--2828. . Sayar claims that the students of their Sayar claims that the students of their generation in generation in İİstanbul University stanbul University --who were born during who were born during the years of the Second the years of the Second World War, were unable to go beyond understanding Sabri Ülgener in between the World War, were unable to go beyond understanding Sabri Ülgener in between the fragmented lines of superficial and unidirectional thinking predominated by the politi-fragmented lines of superficial and unidirectional thinking predominated by the politi-cal sensitivities.cal sensitivities.

103 Gülten Kazgan mentions that it was Sabri ÜlgeGülten Kazgan mentions that it was Sabri Ülgener who introduced Keynes to themner who introduced Keynes to them. . Kazgan,Kazgan, Bir İktisatçının TanıklıklarBir İktisatçının Tanıklıkları, ı, 11.11.

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created by the historical trajectory of the 1950s. Developmental issues, social security measures and redistributive responsibilities of the state were more on the agenda of both governmental institutions and aca-demia. Seeing the economic phenomenon from the macro level was more appreciated and the transition from micro to macroeconomics was considered as the foundation of modern economics.104

MİLLİ GELİR, İSTİHDA

MİLLİ GELİR, İSTİHDAM VE İKTİSADİ BÜYÜMEM VE İKTİSADİ BÜYÜME

Gülten Kazgan’s

Gülten Kazgan’s in her in her memories claims that Ülgener’s book, which had memories claims that Ülgener’s book, which had a holistic theoretical structure, was taught for many years in the facul-a holistic theoretical structure, was taught for many years in the facul-ty.ty.105 ThThee book seems like a masterful reception of Keynesian precepts book seems like a masterful reception of Keynesian precepts in in accordance with the peculiarities of the local. One can confront with accordance with the peculiarities of the local. One can confront with the Keynesian vein eventhe Keynesian vein even inin thethe first quotation first quotation atat the very beginning of the very beginning of the book. Ülgener goes a hundred years back and quotes Ahmet Cevdet the book. Ülgener goes a hundred years back and quotes Ahmet Cevdet Pasha’s words “the development and wealth of aPasha’s words “the development and wealth of a state don’t originate state don’t originate from the abundance of money, but most probably from the circulation of from the abundance of money, but most probably from the circulation of that money.”that money.”106 From this point of view, he claims that welfare can only From this point of view, he claims that welfare can only

104 Sayar argues that the book Sayar argues that the book of Sabri Ülgener of Sabri Ülgener which was constructed upon the which was constructed upon the Keynesian logic is indeed indebted to Prof. Alvin Hansen’s Keynesian logic is indeed indebted to Prof. Alvin Hansen’s A Guide to Keynes, A Guide to Keynes, which is a which is a successful vulgarization of successful vulgarization of The General TheoryThe General Theory. (Ülgen. (Ülgener attended the lectures of Han-er attended the lectures of Han-sen in Harvard in between 1946 and 1948.) He mentions that it was Ülgener who sen in Harvard in between 1946 and 1948.) He mentions that it was Ülgener who brought the partial equilibrium approach of Keynes in solving the unemployment brought the partial equilibrium approach of Keynes in solving the unemployment problem in Turkey within a systematic and healthy analysis. Sayar whproblem in Turkey within a systematic and healthy analysis. Sayar while saying this, ile saying this, reminds the reader that the history of modern economic thought was completely emp-reminds the reader that the history of modern economic thought was completely emp-ty until the 1940s as it was still Ohannes Pasha’s ty until the 1940s as it was still Ohannes Pasha’s MebadiMebadi--i İlmi İlm--i Servet (1880)i Servet (1880) circulat-circulat-inging at large. at large. Sayar, “Sabri Ülgener’in Bıraktığı MirasSayar, “Sabri Ülgener’in Bıraktığı Miras,,” 28” 28..

105 GültenGülten Kazgan, Kazgan, Bir İktisatçının TanıklıklarıBir İktisatçının Tanıklıkları, 12, 12--1313.. Nevertheless Kazgan also mentions Nevertheless Kazgan also mentions that they were not really benefited from Ülgener and they were unablthat they were not really benefited from Ülgener and they were unable to understand e to understand Keynes at first since they were already unfamiiar with both the neoclassical theory Keynes at first since they were already unfamiiar with both the neoclassical theory and the impacts of the Great Depression.and the impacts of the Great Depression. Ibid., Ibid., 1010..

106 Sabri Sabri Ülgener, Ülgener, Milli GelirMilli Gelir, , İstihdam ve İktisadi Büyüme İstihdam ve İktisadi Büyüme (İstanbul: İstanbul Üniversitesi, (İstanbul: İstanbul Üniversitesi, 1966), 3. 1966), 3. ccited from Ahmet Cevdet, ited from Ahmet Cevdet, Tarih,Tarih, vol.vol. 3, 1003, 100..

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be achieved by income generating employment. In other words, he em-

be achieved by income generating employment. In other words, he em-phasizes on the fact thatphasizes on the fact that wealth is not dependent on the abundance of wealth is not dependent on the abundance of money but its circulation via spending. Hence, total spending is revealed money but its circulation via spending. Hence, total spending is revealed as the primary force that creates employment and national incomeas the primary force that creates employment and national income107, , similar with what Keynes recommended.similar with what Keynes recommended.

However, this book can not be regarded as a total imitation of the Keynesian theory. Ülgener mentions that the issues related with na-tional income, employment and economic growth have come into its own by the theory of Keynes since the 1930s and branched out from then on, but he also annotates there is no doubt that these issues were handled in consideration of the conditions of developed economics. This concern on the discrepancies between the applicability of the theo-ries lies at the heart of the book. In the preface, he states the most im-portant task for him is to align the theoretical discussions with the problems of a less developed economy. He considers this as a profes-sional due and duty for him, as the issues related with national income, employment and economic growth are closely related with the destiny of a national economy indeed.108

The influence of local dynamics in adaptation of the theory is clearly seen concerning employment. Keynes’ emphasis on employment is re-lated with the assumption of classical theory claiming there is always full employment at the equilibrium level. Keynes challenged this by as-serting full employment can only exist under rare and certain condi-tions. Ülgener, in line with Keynesian sensitivities, claims that the high-ness of standard of living in a country is bound to its citizens’ income getting power in real terms109 which can only be achieved by employ-ment. He also considers underemployment as the primary problem; but he touches upon the issue by concentrating on the divergences between the developed and less developed countries. Apart from the possibilities for necessary conditions of full employment, he focuses on the structure

107 Ülgener, Ülgener, Milli GelirMilli Gelir, , 3.3.

108 Ibid., Ibid., iii.iii.

109 IbidIbid., ., 1212.. cited from Pigou, cited from Pigou, Income, An Introduction to EconomicsIncome, An Introduction to Economics (Macmillan, 1948), (Macmillan, 1948), 1717..

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of that unemployment. The main problem for Ülgener is not open un-employment, but disguised unemployment; and the remedy is not achieving full employment level, but effective employment.110

In addition, he splits from potential Keynesian solutions in curing the problem of unemployment, as the reasons behind unemployment in developed and developing countries are different from each other. He suggests that in countries like Turkey, unemployment is due to the idle-ness and lazyness, instead of an involuntary employment or demand insufficiency. In addition, again as distinct from the developed regions, there is “intrinsic” (bünyevi) unemployment and people in this group are defined as the masses that the narrow productive capacity is unable to absorb. Therefore, underemployment in less developed countries is justified by the disproportion between the factors of production. In Western countries, on the other hand, unemployment is cyclical or pe-riodic, not intrinsic.111

Another difference emerges on the reaction of the societies in less developed countries vis-à-vis lack of income and demand. In developed countries, such a condition is expected to create a shrinkage in the vol-ume of employment; however, in less developed ones, it increases the number of people working in rural areas in order to achieve their liv-ing.112 This is an important finding because it means that completely different policy measures should be implemented by the governments of the less developed countries in preventing the lack of income. Em-

110 Ülgener, Ülgener, Milli GelirMilli Gelir, 13, 13, 138., 138. JJoan Robinson who was a collaboratooan Robinson who was a collaborator of Keynes, also r of Keynes, also distinguishes between open and disguised unemployment. Influenced by the period distinguishes between open and disguised unemployment. Influenced by the period she stayed in India, she argued that as far as the economies are dominated by the agri-she stayed in India, she argued that as far as the economies are dominated by the agri-cultural sector, the contribution to economic output remains little in tcultural sector, the contribution to economic output remains little in the sense that, he sense that, the low levels of productivity is hidden behind their appearthe low levels of productivity is hidden behind their appearaance to be occupied. John nce to be occupied. John Toye, Toye, ““The Influence of Keynes on Development EconomicsThe Influence of Keynes on Development Economics,”,” cited from Joan Robinson, cited from Joan Robinson, ““Disguised UnemploymentDisguised Unemployment,”,” Economic Journal,Economic Journal, XLVI (182)1936XLVI (182)1936, , 225225--3333.. accaccessed by essed by https://www.researchgate.net/publication/287453672_The_influence_of_Keynes_on_https://www.researchgate.net/publication/287453672_The_influence_of_Keynes_on_development_economicsdevelopment_economics..

111 Ülgener, Ülgener, Milli GelirMilli Gelir, 6, 6..

112 Ibid., 138.Ibid., 138.

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phasizing on this difference is also important in the sense that this be-havioral tendency has strong linkages with the dominant mentality in the local and structure of the economy.113

Another significant fixation of Ülgener is his emphasis on the discur-sive division between less developed- underdeveloped countries in the sense that these terms might evoke a “static” circumstance. Ülgener’s effort was to break the chains of this static perception. At this point, he attracts attention to the conceptual analysis of a “less developed” coun-try and defines it as a country in which most of the population is work-ing in agricultural sector and the income per capita is low. However, he puts special emphasis on those countries’ desire and potential for eco-nomic development.114 That desire seems to be the source of inspira-tion for Ülgener through all his writings and his vision reflected in this book provides a peculiar road map for the development possibilities in Turkey via the Keynesian lens.

7.5.1.2 The Impact of Keynes on Sadun ArenThe Impact of Keynes on Sadun Aren

Although Sadun Aren defines himself as a Marxist,

Although Sadun Aren defines himself as a Marxist, Tuncer Bulutay who Tuncer Bulutay who was his first assistant in Mülkiye, claimed that Aren didn’t mwas his first assistant in Mülkiye, claimed that Aren didn’t mention ention MarxiMarxianan economics in his lectures; instead, he gave lectures on Keynes-economics in his lectures; instead, he gave lectures on Keynes-ian economics, mathematical economics and statistics. In addition, ian economics, mathematical economics and statistics. In addition, Bulutay also asserts that Aren was the leading figure or among the lead-Bulutay also asserts that Aren was the leading figure or among the lead-ing ones that brought Keynesian economicsing ones that brought Keynesian economics to Turkey.to Turkey.115 It might be It might be

113 We see an example of this during the depression years in Turkey. The contribution of We see an example of this during the depression years in Turkey. The contribution of the agriculturathe agricultural sector was very high in the total national income as there were still l sector was very high in the total national income as there were still immense cultivated lands. But this was a conjunctural chance and not a sustainable immense cultivated lands. But this was a conjunctural chance and not a sustainable alternative for the 1950s Turkey.alternative for the 1950s Turkey.

114 Ülgener, Ülgener, Milli Gelir, Milli Gelir, 4.4.

115 “Mülkiyeliler Birliği ve Vakfı’nı“Mülkiyeliler Birliği ve Vakfı’nın Prof. Sadun Aren’in 80. Doğum Günü Kutlama n Prof. Sadun Aren’in 80. Doğum Günü Kutlama Töreninden Konuşmalar,” Töreninden Konuşmalar,” Sadun Aren’e 80. Yaş ArmağanıSadun Aren’e 80. Yaş Armağanı (Ankara: Mülkiyeliler Birliği (Ankara: Mülkiyeliler Birliği Vakfı Yayınları 31, Aralık 2003), 25Vakfı Yayınları 31, Aralık 2003), 25--2626..

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unexpected for the audience who

unexpected for the audience who is is familiar with the politicalfamiliar with the political stance stance of of Aren.Aren. But, iBut, in scrutinizing the prepatory reasons behind the ideological n scrutinizing the prepatory reasons behind the ideological affinities of Aren both for Marx and Keynes, affinities of Aren both for Marx and Keynes, one would beone would be confronted confronted with some breakinwith some breaking points through his reading history. Aren was espe-g points through his reading history. Aren was espe-cially interested in reading cially interested in reading on on a wide scale of subjects, from Julian Hux-a wide scale of subjects, from Julian Hux-ley’s encyclopedia on biology to Hitler, as well as the economics books. ley’s encyclopedia on biology to Hitler, as well as the economics books. What led him to zoom in Keynesian theory was an assumption What led him to zoom in Keynesian theory was an assumption he saw in he saw in one of those economics books. It was the assertion that saving is equal one of those economics books. It was the assertion that saving is equal to investment in macro level. He then began to reflect upon the issue to investment in macro level. He then began to reflect upon the issue and wrote an article with a Keynesian approach.and wrote an article with a Keynesian approach.116 Another critical Another critical threshold for Aren’s recognition of Kethreshold for Aren’s recognition of Keynes was the Cambridge times ynes was the Cambridge times which provided him a great opportunity to be which provided him a great opportunity to be aroundaround the prominent the prominent economists. He became a student of Joan and Austin Robinson. Maurice economists. He became a student of Joan and Austin Robinson. Maurice Dobb was his supervisorDobb was his supervisor who who iiss defineddefined by Arenby Aren as the greatest of the as the greatest of the living economistsliving economists..117 HeHe took lessons from Nicholas Kaldor and he met took lessons from Nicholas Kaldor and he met Pierro Sraffa there.Pierro Sraffa there.118 He says that he mostly read Keynes there, as He says that he mostly read Keynes there, as KeynesKeynes was the persona grata at those times. was the persona grata at those times. He appreciates the revolu-He appreciates the revolu-tionary contributions of Keynes to the bourgeoisie economic science.tionary contributions of Keynes to the bourgeoisie economic science.119

116 Cem Eroğul, “Söyleşi: Beş Günde Bir Ömür,” in Cem Eroğul, “Söyleşi: Beş Günde Bir Ömür,” in Sadun Aren’e 80. Yaş ArmağanıSadun Aren’e 80. Yaş Armağanı, 111. , 111. AAren in ren in thethe interview remarks that his article was not accepted in the faculty to be interview remarks that his article was not accepted in the faculty to be publishedpublished..

117 Aren, Aren, Puslu Camın, Puslu Camın, 102.102.

118 Eroğul, “Söyleşi,” in Eroğul, “Söyleşi,” in Sadun Aren’e Sadun Aren’e 80. Yaş Armağanı80. Yaş Armağanı, , 121266. It should be noted that all . It should be noted that all these names cannot be defined as Keynesianthese names cannot be defined as Keynesian. Maurice Dobb was a Marxist historian . Maurice Dobb was a Marxist historian and Pierro Sraffa was not really a fellow of Keynes. What he wanted to do is to turn and Pierro Sraffa was not really a fellow of Keynes. What he wanted to do is to turn back to classical school including Marx by removing the marginal analysis and Mar-back to classical school including Marx by removing the marginal analysis and Mar-shallian analytical tools on supply demand system. shallian analytical tools on supply demand system. Moreover, although Sraffa and Moreover, although Sraffa and Keynes represent the characteristic of the Cambridge School, as Robinson also men-Keynes represent the characteristic of the Cambridge School, as Robinson also men-tioned, Sraffa regarded Keynes as a bourgeoisie intellectual that can’t really develop tioned, Sraffa regarded Keynes as a bourgeoisie intellectual that can’t really develop insights on working class problems. Backhouse et al. insights on working class problems. Backhouse et al. KeyneKeyness, , 126126..

119 “Sadun Aren’le Görüşme,” “Sadun Aren’le Görüşme,” in in Sadun Aren’e ArmağanSadun Aren’e Armağan, , ed. Tuncer Bulutay (Ankara: ed. Tuncer Bulutay (Ankara: Mülkiyeliler Birliği Vakfı Yayınları, 1989),Mülkiyeliler Birliği Vakfı Yayınları, 1989), 4.4. This wording “bourgeoisie economic sci-This wording “bourgeoisie economic sci-ence” reminds Röpke’s manifestation shared by Ülgener that was “any science can be ence” reminds Röpke’s manifestation shared by Ülgener that was “any science can be regarded as a bourgeoisie science”. Ülgener, “Marksist Teori ve Neoklasik İktisat,” 59.regarded as a bourgeoisie science”. Ülgener, “Marksist Teori ve Neoklasik İktisat,” 59.

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Wha

What made Aren familiar with the Marxist approaches in developing t made Aren familiar with the Marxist approaches in developing a holistic view on society and economics was his appointment to give a holistic view on society and economics was his appointment to give lectures on sociology.lectures on sociology.120 He read He read variousvarious sociological books including sociological books including Muzaffer Şerif’s Muzaffer Şerif’s Psychology of Social Norms,Psychology of Social Norms, in order tin order to have a compre-o have a compre-hensive understandinghensive understanding on the issueon the issue. Throughout the reading journey, he . Throughout the reading journey, he sasaysys that he developed a better awareness on the relativity of the social that he developed a better awareness on the relativity of the social norms, which were in fact the products of social evolution. Since then, norms, which were in fact the products of social evolution. Since then, hehe mentionsmentions that his relthat his reliance on absolute norms was shrinked. At the iance on absolute norms was shrinked. At the end of the line, he turned out to be Marxist. It is also worth to mention end of the line, he turned out to be Marxist. It is also worth to mention that instead of directly reading Marxist works, he read books on a that instead of directly reading Marxist works, he read books on a broader scale, in his way to be a Marxist.broader scale, in his way to be a Marxist.121

Being under the influence

Being under the influence of these two milestones might not be that of these two milestones might not be that astonishing from an external perspective, as we are familiar with the astonishing from an external perspective, as we are familiar with the ideological affinities of Mülkiye tradition ideological affinities of Mülkiye tradition fromfrom the 1950sthe 1950s onwardsonwards. Yet, . Yet, we should keep in mind that Sadun Aren was a constitutive figure of we should keep in mind that Sadun Aren was a constitutive figure of thathat tradition. He seems to melt these two milestones in economics in t tradition. He seems to melt these two milestones in economics in the same pot by asserting that the economic views of Keynes and Marx the same pot by asserting that the economic views of Keynes and Marx were not really different, except their philosophical stance. He claims were not really different, except their philosophical stance. He claims that for Keynes, there are concepts like investmthat for Keynes, there are concepts like investment spending and con-ent spending and con-sumption spending and the relations between these two sumption spending and the relations between these two areare empha-empha-sizedsized;; while for Marx, there iswhile for Marx, there is aa sector in which the capital goods are sector in which the capital goods are produced and a second one in which the consumption goods are pro-produced and a second one in which the consumption goods are pro-duced. These two approaches for Aren duced. These two approaches for Aren can be degraded into each oth-can be degraded into each oth-er.er.122

Bulutay

Bulutay claims that Keynesian theory was unfamiliar and hard to claims that Keynesian theory was unfamiliar and hard to understand for them during the early 1950s, however, Sadun Aren suc-understand for them during the early 1950s, however, Sadun Aren suc-ceeded ceeded in in clarifying the topic with his distinctive teaching style.clarifying the topic with his distinctive teaching style.123 En-En-

120 Aren makes detailed explanations on hisAren makes detailed explanations on his creation of awareness based on his childhood creation of awareness based on his childhood memories in his autobiographical book memories in his autobiographical book Puslu Camın Arkasından. Puslu Camın Arkasından.

121 Eroğul, “Söyleşi,” in Eroğul, “Söyleşi,” in Sadun Aren’e Sadun Aren’e 80. Yaş Armağanı80. Yaş Armağanı,, 111144..

122 Ibid., 135.Ibid., 135.

123 However, Tuncer Bulutay who was a student of Aren argues that KeyneHowever, Tuncer Bulutay who was a student of Aren argues that Keynesian theory is sian theory is not applicable for Turkey and macroeconomics should not be taught on the basis of not applicable for Turkey and macroeconomics should not be taught on the basis of

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riched by

riched by such such a stra strong theoretical infrastructure, Aren ong theoretical infrastructure, Aren also also wrote a wrote a book book İstihdam, Para ve İktisadi Politikaİstihdam, Para ve İktisadi Politika.. HeHe mentions that there was no mentions that there was no originality in this book, it can be regarded as a collection of what he originality in this book, it can be regarded as a collection of what he read and learned.read and learned.124 The book starts with the theory of employmeThe book starts with the theory of employment, nt, clarifying the concepts related to it and reserves a section for the eco-clarifying the concepts related to it and reserves a section for the eco-nomic science in the less developed countries. He first explains the clas-nomic science in the less developed countries. He first explains the clas-sical school’s employment, interest and wage theory than elaborates on sical school’s employment, interest and wage theory than elaborates on Keynes’ theory in interest. We are cKeynes’ theory in interest. We are confronted with the concepts like onfronted with the concepts like liquidity preferences, multiplier effect and effective demand that consti-liquidity preferences, multiplier effect and effective demand that consti-tute the core tute the core themethemes of Keynesian theory. Thens of Keynesian theory. Then,, he examines the busi-he examines the busi-ness cycles and theories on money, which again end up with a sepness cycles and theories on money, which again end up with a sepaarate rate section for section for Keynesian theory of money. Next, he explains the interna-Keynesian theory of money. Next, he explains the interna-tional balances in the fourth chapter and economic policies in the fifth. tional balances in the fourth chapter and economic policies in the fifth. He mentions the automatic precautions and voluntary measures in as-He mentions the automatic precautions and voluntary measures in as-surance of surance of the the economic stability. He also makes evaluationseconomic stability. He also makes evaluations on the de-on the de-velopmental policies, particularly for the less developed countries, again velopmental policies, particularly for the less developed countries, again focusing on the plan, foreign investment, savings and hidden unem-focusing on the plan, foreign investment, savings and hidden unem-ployment.ployment.

At the very beginning of the book, he identifies the main problem of an economic order as unemployment. For him, this points out whether an economy is functioning well or not.125 This is a common concern in Ülgener as well. As the problem of unemployment emerges as a primary task in both books, it can be said that the concrete primacy of the Turk-ish economy was considered as unemployment in the corresponding years. However, unlike Ülgener, Aren argues that it is not the idleness of people, but the system is to blame since the system is not able to create a volume of demand which would have required the usage of the labor power.126 Based on a viewpoint prioritizing mentality analysis, Ülgener

Keynesian thinking. Bulutay, “Türkiye’de İktisadın Okutuluşu Üzerine

Keynesian thinking. Bulutay, “Türkiye’de İktisadın Okutuluşu Üzerine,,” ” AÜSBFAÜSBFDD 20, no. 20, no. 4 (4 (19651965): ): 22--33..

124 Aren, Aren, Puslu Camın, Puslu Camın, 103.103.

125 Sadun Sadun Aren, Aren, İstihdam,İstihdam, Para ve İktisadi PolitikaPara ve İktisadi Politika ((Ankara: Bilgi Yayınevi, Ankara: Bilgi Yayınevi, 1975)1975),, 1717..

126 Ibid.Ibid.,, 1177..

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tends to consider the main aspect of the problem as people’s inclination to be idle or lazy, while Aren regards the issue within a more structural-ist perspective by accusing the system.

Consequently, it can be said that both Aren and Ülgener believed in

Consequently, it can be said that both Aren and Ülgener believed in local adaptation possibilities of Keynesian economics. Their efforts local adaptation possibilities of Keynesian economics. Their efforts were so influential on their assistants and students that they became were so influential on their assistants and students that they became reference points for the folreference points for the following generations. The continuity can be lowing generations. The continuity can be clearly seen in a small section devoted to “Keynesian economics and less clearly seen in a small section devoted to “Keynesian economics and less developed countries” in Tuncer Bulutay’s developed countries” in Tuncer Bulutay’s İktisadi Büyüme Nazariyeleriİktisadi Büyüme Nazariyeleri, , for instance. Although there are many references to Ricardo, Marx and for instance. Although there are many references to Ricardo, Marx and Schumpeter, a particular Schumpeter, a particular separate separate section section iis only devoted to Keynes in s only devoted to Keynes in the book. In this section, Bulutay alsothe book. In this section, Bulutay also acknowledgesacknowledges the value of the the value of the theory as atheory as an importantn important analytical tool. He makes a comparison between analytical tool. He makes a comparison between developed and less developed countries and sadeveloped and less developed countries and says that the national in-ys that the national in-come is determined by the effective demand come is determined by the effective demand –– and supply demand rela-and supply demand rela-tionstions –– for bothfor both. He . He argueargues that the difference s that the difference isis the lack of supply facili-the lack of supply facili-tiesties in the less developed ones, but it doesn’t mean that Keynesian in the less developed ones, but it doesn’t mean that Keynesian theory loses its validtheory loses its validity for the developing countries.ity for the developing countries.127 This viewpoint This viewpoint might have been inherited by Sadun Aren, who always emphasized on might have been inherited by Sadun Aren, who always emphasized on the scientific value of the scientific value of thethe theory. theory.

§ 7.6 Concluding RemarksConcluding Remarks

It is useful to analyze on the reasons behind why a certain theory or model functions well at some place and becomes hindered in another. In his book Economic Theory and Underdeveloped Regions (1957), Gun-

127 TuncerTuncer Bulutay,Bulutay, BaşlıcaBaşlıca İktisadi Büyüme Nazariyeleriİktisadi Büyüme Nazariyeleri (Ankara: Ankara Üniversitesi (Ankara: Ankara Üniversitesi Siyasal Bilgiler Fakültesi, 1961),Siyasal Bilgiler Fakültesi, 1961), 8383..

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nar Myrdal mentions the exigency of the economists in the less devel-oped countries in finding the most suitable path for their countries with their own efforts.128 Ülgener, also pays attention to these particularities by referring these words of Myrdal. On the other hand, the importance of the existing theories is not neglected by Ülgener. He refers to Mar-shall’s sober words “the difference is rather in the external moulds than the essence of economic action. Therefore, the applicable parts of the modern economic theory for the less developed countries, are neces-sarily more than it might be supposed at the first glance”.129 The appre-ciation of “theory” can be considered as a common denominator for both Ülgener and Aren through their textbooks.

As it is stated in the very beginning part of the chapter, Keynes him-self also considered economics as a method rather than a thinking.130 In line with that, we can say that the agents that played the central roles in appreciation of the Keynesian method have also regarded the issue in a similar way. Both Ülgener and Aren, remunerating the value of the the-ory, primarily considered Keynesian economics based on its practical concerns of the country instead of handling it as an ideological appara-tus. In this sense, both academics who represented for different intel-lectual streams, flow into that single pool. Although they were nour-ished by different ideological flows, they were both aware of the variety of viewpoints and succeded in developing a total understanding on both the economics and sociology. Ülgener was translating Keynesian theo-ries by particulary concentrating on the mentality analysis inspired by Weber and Sombart, while Aren was interpreting Keynes within a more structuralist framework by the influence of Marx. This situation might make the reader think of a presence of a conflict in translation of

128 ÜlgenerÜlgener, Milli Gelir, Milli Gelir, 5, 5..

129 Ibid.,Ibid., cited cited inin MarshalMarshall, l, Elements of Economic IndustryElements of Economic Industry, , ((19391939),), 55..

130 Colander, "Teaching KeynesColander, "Teaching Keynes,”,” 371, cited in Keynes, 1921, v. 371, cited in Keynes, 1921, v. Colander reminds a famous Colander reminds a famous joke about the inconsistency of Keynes that is joke about the inconsistency of Keynes that is ––“I“If you have four economists, you will f you have four economists, you will have four different positions, unlehave four different positions, unless of course one of thess of course one of themm is Mr. Keynes, then you will is Mr. Keynes, then you will have seven different positionshave seven different positions.”.” Ibid., Ibid., 371371..

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Keynes in between these two universities. On the other hand, it also refers to an enrichment and a complementarity which reflect the theo-retical fertileness of the local academic agents.

The drifts toward the widespread translation of Keynesian methods might indicate the inadequacy of the former school of thoughts’ asserti-ons on equilibrium analysis, price adjustment processes in solving the current problems. For those who were disappointed by the orthodox theory; Keynesian theory, which posed a challenge against certain basic assumptions of the classical theory might be a center of attraction. This was probably more apparent in the countries wherein there exists strongly established statist traditions. The Keynesian methods might have sounded as a more scientific macro-based approach in these co-untries, which had already implemented directed economy models poli-tically and morally.131 The expectations from adopting this approach might be both settling economics on a more concrete ground and catc-hing up the changing economic trends in the world, especially when we think of the rise of Keynesianism in America.

Certain doctrines of Keynes were obviously rejected; however,

Certain doctrines of Keynes were obviously rejected; however, Keynesian methods constituted a central vein in the intellectual for-Keynesian methods constituted a central vein in the intellectual for-mation of the teaching of the subdisciplinemation of the teaching of the subdiscipline, , namely macroeconomics in namely macroeconomics in the the aftermath of the Second World War. It is true that Keynesian ideas aftermath of the Second World War. It is true that Keynesian ideas were not in all respects applicable for developing countries and maybe were not in all respects applicable for developing countries and maybe Keynes himself was not really interested in preparing a receipt for the Keynes himself was not really interested in preparing a receipt for the developing world, except his role in the Brettdeveloping world, except his role in the Bretton Woods System.on Woods System.132 How-How-

131 Kağan Öğüt and Cenk Yaltırak, “Kemalizmin Ekonomi Politiğinde Unutulmuş Bir Sayfa: Kağan Öğüt and Cenk Yaltırak, “Kemalizmin Ekonomi Politiğinde Unutulmuş Bir Sayfa: Güdümlü EkonomiGüdümlü Ekonomi,,” cited from Nenovsky” cited from Nenovsky ((2010:282010:28)) in in Türkiye’de İktisadi Türkiye’de İktisadi DüşünceDüşünce, , 187.187.

132 One exception is his role in Bretton Woods system, an attempt to preserve stability One exception is his role in Bretton Woods system, an attempt to preserve stability and construct a world of international relations based on mutual benefits. Keynesian and construct a world of international relations based on mutual benefits. Keynesian precepts played chief roleprecepts played chief roless in the theoretical formation of IMF and Woin the theoretical formation of IMF and World Bank. George rld Bank. George C. Peden, “Keynes ve İngiliz Ekonomi PolitikasıC. Peden, “Keynes ve İngiliz Ekonomi Politikası,,” in ” in Keynes, Keynes, 114. For a detailed analysis 114. For a detailed analysis on the antiutilitarian international macroeconomic perspective of Keynes, see on the antiutilitarian international macroeconomic perspective of Keynes, see Anna M. Anna M. CarabelliCarabelli and Mario A. Cedrini. “Keynes and the Complexity of Iand Mario A. Cedrini. “Keynes and the Complexity of International Economic nternational Economic

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ever, what the Turkish academia mainly borrowed from him is an alter-

ever, what the Turkish academia mainly borrowed from him is an alter-native identification of the concerns about economics via different ap-native identification of the concerns about economics via different ap-paratuses, different fromparatuses, different from thethe classical, neoclassical and historical ap-classical, neoclassical and historical ap-proaches. Keynesian philosproaches. Keynesian philosophy enlarged the viewpoint of economic ophy enlarged the viewpoint of economic understanding. It, not only provided new concepts for the economic understanding. It, not only provided new concepts for the economic theory, but also provided a new and different starting point.theory, but also provided a new and different starting point.133 Although Although there might be debates on the validity of Keynesian precepts, his writ-there might be debates on the validity of Keynesian precepts, his writ-ings weings were considered to be worth teaching also in Turkey in the sense re considered to be worth teaching also in Turkey in the sense that they provide a vision of macroeconomics different from the classi-that they provide a vision of macroeconomics different from the classi-cal one.cal one.134 As Colander alleged, As Colander alleged, ““it it iis a vision that s a vision that does not assume does not assume that that the market economythe market economy –– left to its own devicesleft to its own devices –– wilwill necessarily gravitate l necessarily gravitate toward a preferable equilibriumtoward a preferable equilibrium..””135 This meant an acknowledgement of This meant an acknowledgement of the complexity of economics, an oppositional challenge against the as-the complexity of economics, an oppositional challenge against the as-sumption that there is a natural tendency in economy to return to equi-sumption that there is a natural tendency in economy to return to equi-librium.librium.

Relations in the Aftermath of World War I

Relations in the Aftermath of World War I,,”” Journal of Economic IssuesJournal of Economic Issues 44, no. 4 (2010): 44, no. 4 (2010): 10091009––1027.1027. www.jstor.org/stable/25800731www.jstor.org/stable/25800731..

133 WolffWolff and and Resnick, Resnick, Çatışan İktisadi TeorilerÇatışan İktisadi Teoriler, 138. Keynes posed a challenge against the , 138. Keynes posed a challenge against the utility maxutility maximization of individuals. Instead, he suggested a new saving concept based imization of individuals. Instead, he suggested a new saving concept based on mass psychology and habits and utilized it in explaining the supply of savings.on mass psychology and habits and utilized it in explaining the supply of savings.

134 One example is related with tOne example is related with the quantity theory of he quantity theory of mmoney oney of of the classical macroeco-the classical macroeco-nomic viewpoinomic viewpoint which is based on the assumption of nt which is based on the assumption of mmoney neutrality. Keynes was oney neutrality. Keynes was against this assumption. Nourished by Keynesian viewpoint Samuelson’s quotation against this assumption. Nourished by Keynesian viewpoint Samuelson’s quotation reveals why quantity theory of reveals why quantity theory of mmoney was interrogated. “In terms of oney was interrogated. “In terms of the the quantity the-quantity the-ory of ory of mmoney, we may sayoney, we may say that the velocity of circulation of money does not remain that the velocity of circulation of money does not remain constant. constant. ‘‘You can lead a horse to water, but you can’t make him drinkYou can lead a horse to water, but you can’t make him drink’’. You can force . You can force mmoney on the system in exchange for government bonds, its close oney on the system in exchange for government bonds, its close mmoney substitute; oney substitute; but you can’t make the but you can’t make the mmoneyoney circulate against new goods and new jobs. You can get circulate against new goods and new jobs. You can get some interest rates down, but not all to the same degree. You can tempt businessmen some interest rates down, but not all to the same degree. You can tempt businessmen with cheap rates of borrowing, but you can’t make them borrow and spend on new with cheap rates of borrowing, but you can’t make them borrow and spend on new investment goods.investment goods.”” W. Robert BrazeltoW. Robert Brazelton, “A Survey of Some Textbook Misinterpreta-n, “A Survey of Some Textbook Misinterpreta-tions of Keynestions of Keynes,,”” Journal of Post Keynesian EconomicsJournal of Post Keynesian Economics 3, no. 2 3, no. 2 ((19801980):): 252577––2258, c58, cited ited inin SamuelsonSamuelson ((19481948aa:: o. 353)o. 353).. www.jstor.org/stable/4537591www.jstor.org/stable/4537591 135 Colander, "TeColander, "Teaching Keynesaching Keynes,,” ” 365.365.

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Understanding the experience of Turkey with Keynesianism first re-quires considering the representative academic actors in Turkey as “agencies” instead of imitators. Revealing the relations between the corpus of the local thought made them settle a peculiar intellectual framework for the discipline of economics. Through the academic net-works they had engaged in, they became acquainted with Keynes and Keynesians. However, it should be noted that they were not dependent on the assumptions of the theory. They contributed to the theory by reconsiderating it vis-à-vis the particularities of a developing country. From the late 1950s and through the 1960s, Keynesian tenets became much more familiar in academic institutions, and the process ended up with the translation of the neoclassical synthesis of Samuelson, namely Economics. Even so, it is hard to say that a longlived Keynesian ecole could be provided in Turkey similar with what happened in America by the contributions of Hansen, Krugman and Stiglitz. But this is not an unexpected thing though, as it is not an easy job to preserve the basic essence of the theory and construct an ecole upon that in a developing country with apparent structural diversities from the developed world wherein the Keynesian theory was born.

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Some ReflectionsSome Reflections on the Ideological Atmosphere: on the Ideological Atmosphere: The Determining Factors Behind the Adherence to The Determining Factors Behind the Adherence to CapitalismCapitalism

t would not be unexpectant if each chapter in this study

t would not be unexpectant if each chapter in this study werewere subject subject to separate dissertations, considerto separate dissertations, consideringing the profundities of the content the profundities of the content ththey provide for.ey provide for. However, I preferred to However, I preferred to put them all together in this put them all together in this dissertation as my prior focus was oriented to the formational process dissertation as my prior focus was oriented to the formational process of the discipline since the foundational years of the of the discipline since the foundational years of the discipinediscipine of econom-of econom-icsics in Turkeyin Turkey. In doing this, I felt the r. In doing this, I felt the responsibility of portraying all the esponsibility of portraying all the core constituents of the discipline core constituents of the discipline by ways of by ways of emphasizing on the evolu-emphasizing on the evolu-tionarytionary journey of eacjourney of each h –– although such a preference carries the risk of although such a preference carries the risk of detracting the reader from a feeling of detracting the reader from a feeling of integrityintegrity at times. But indeed, it at times. But indeed, it iis little wonder to confront with the traces of such a feeling in this dis-s little wonder to confront with the traces of such a feeling in this dis-sertation as this lack of unity was also verified by a distinguished stu-sertation as this lack of unity was also verified by a distinguished stu-dent in the Istanbul University Faculty of Economics in between 1946 dent in the Istanbul University Faculty of Economics in between 1946 and 1950, whoand 1950, who would thenwould then becbecoome a prominenme a prominent economist of the forth-t economist of the forth-coming years, Gülten Kazgan. She mentions that the economics they coming years, Gülten Kazgan. She mentions that the economics they were taught, was like the islets in the ocean, far away from constituting were taught, was like the islets in the ocean, far away from constituting

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an integrity.

an integrity.136 And the whole content of this study proves for this claim And the whole content of this study proves for this claim in a sense. So, altin a sense. So, although it was a risk to envision this study in this way, hough it was a risk to envision this study in this way, giving weight to the descriptive part; I preferred to do so in a conscious giving weight to the descriptive part; I preferred to do so in a conscious manner, with an intent of reflecting the journey as it was, within quite manner, with an intent of reflecting the journey as it was, within quite objective lenses.objective lenses.

As is presented in the previous ch

As is presented in the previous chapters, the basic goal in this study apters, the basic goal in this study was to reflect the evolution of economicwas to reflect the evolution of economicss discipline based on a package discipline based on a package of the translated theories by academic actors in accordance with the of the translated theories by academic actors in accordance with the local peculiarities with an emphasis on the changing dynamics of this local peculiarities with an emphasis on the changing dynamics of this process process of reception. The focus up to now was oriented to see what was of reception. The focus up to now was oriented to see what was present among the existing repertoire of theories during the present among the existing repertoire of theories during the aforeaforemen-men-tioned time interval. On the other hand, an equally important issue is to tioned time interval. On the other hand, an equally important issue is to see what remained outside this reception process. see what remained outside this reception process. So, in this reflection So, in this reflection chapter, I would like to go in a different direction and chapter, I would like to go in a different direction and elaborateelaborate on the on the questionquestion asas of why certain debates/theories occupying the agenda of of why certain debates/theories occupying the agenda of the Western world in the Western world in those daythose days had no or little repercussions at the s had no or little repercussions at the local economics educalocal economics education.tion. Such a reflection is important as it will give Such a reflection is important as it will give us further clues as to the cultural and social factors that are at play in us further clues as to the cultural and social factors that are at play in the shaping of the field of economics education the shaping of the field of economics education here here in Turkey.in Turkey.

There are various questions to be extracted from the content of

There are various questions to be extracted from the content of this this study, study, as as various themes remained outside the local agenda. For in-various themes remained outside the local agenda. For in-stance, why Keynes became so popular at the local academia; while stance, why Keynes became so popular at the local academia; while Hayek, who was employed in LSE by the efforts of Lionel Robbins as a Hayek, who was employed in LSE by the efforts of Lionel Robbins as a rival equivalent of Keynes, had such little impactrival equivalent of Keynes, had such little impact in teaching of econom-in teaching of econom-ics at local with respect to Keynes?ics at local with respect to Keynes?137 Why a student of economics in Why a student of economics in Turkey had to wait up until the midTurkey had to wait up until the mid--1950s to confront with the tremen-1950s to confront with the tremen-dous impact of the Walrasian general equilibrium approach, which be-dous impact of the Walrasian general equilibrium approach, which be-

136 Gülten Kazgan, Gülten Kazgan, Bir İktisatçının Tanıklıkları Bir İktisatçının Tanıklıkları (İstanbul: İstanbul Bilgi Üniversitesi (İstanbul: İstanbul Bilgi Üniversitesi Yayınları, 2009), 13Yayınları, 2009), 13--16.16.

137 Indeed, Hayek was translated in between 1944 and 1948 by Turhan Feyzioğlu. Aydın Indeed, Hayek was translated in between 1944 and 1948 by Turhan Feyzioğlu. Aydın Yalçın also published articles on Yalçın also published articles on The RThe Road to Serfdom oad to Serfdom in the in the SBFSBF journal. Even so, in my journal. Even so, in my opinion, these works remained superficial in determining the educational content.opinion, these works remained superficial in determining the educational content.

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came a center of attraction du

came a center of attraction during the 1930s Western world?ring the 1930s Western world?138 Why Why the revolutionary concept of game theory which was materialized by the revolutionary concept of game theory which was materialized by the book of Oskar Morgenstern and John von Neumann published in the book of Oskar Morgenstern and John von Neumann published in 1944, could only found place for itself in the local journal articles as late 1944, could only found place for itself in the local journal articles as late as 1969?as 1969?139 AlAll these are relevant questions and each has a lot to say l these are relevant questions and each has a lot to say about the local peculiarities. But reminding the time interval examined about the local peculiarities. But reminding the time interval examined in this dissertation was in correspondence with the restoratiin this dissertation was in correspondence with the restoratioon period n period after the Great Depression, a period when the capitalistafter the Great Depression, a period when the capitalist system was system was be-be-ing questioned heavilying questioned heavily140, the question of why the Turkish academia , the question of why the Turkish academia kept out of the intense critical debates on the maintainability of the cap-kept out of the intense critical debates on the maintainability of the cap-italist system up until the 1960s comes more to the forefront.italist system up until the 1960s comes more to the forefront. In other In other words, why did the economists words, why did the economists of the time not criticize, discuss and ul-of the time not criticize, discuss and ul-timately challenge capitalism as a system during the 1930s and 40s.timately challenge capitalism as a system during the 1930s and 40s.

The most prominent issue

The most prominent issue within economics at the time within economics at the time was the cal-was the cal-culation debateculation debate141 which arose from Ludwig von Mises’s challenge which arose from Ludwig von Mises’s challenge against the socialiagainst the socialist economists in his book st economists in his book Die GemeinswirtschaftDie Gemeinswirtschaft since since the 1920s. Mises was arguing for the impossibility of an efficient price the 1920s. Mises was arguing for the impossibility of an efficient price system in a socialist economysystem in a socialist economy –– dduring the absence of a marketuring the absence of a market –– inin

138 Fikret Görün mentions that Nejat Bengül’s “Nazari İktisat” was the first course in Fikret Görün mentions that Nejat Bengül’s “Nazari İktisat” was the first course in which the quantitative neoclassical miwhich the quantitative neoclassical microeconomics was taught. The concepts like croeconomics was taught. The concepts like indifference curves, Walrasian equilibrium and Edgeworth box began to be included in indifference curves, Walrasian equilibrium and Edgeworth box began to be included in the Turkish economic literature in the midthe Turkish economic literature in the mid--1950s. Fikret Görün, “Nasıl İktisatçı Oldum 1950s. Fikret Görün, “Nasıl İktisatçı Oldum (mu)?: Çok Kişisel Bir Tarih ve Türkiye’d(mu)?: Çok Kişisel Bir Tarih ve Türkiye’de İktisat Eğitimi,” in e İktisat Eğitimi,” in Ulusal İktisat Eğitimi Ulusal İktisat Eğitimi Sempozyumu, Sempozyumu, ed. Ercan Uygur (Ankara: İmaj Yayınevi: 2005), 48.ed. Ercan Uygur (Ankara: İmaj Yayınevi: 2005), 48.

139 Esat Çam, “Oyun Teorisinin Mahiyeti ve Oyunlar,” Esat Çam, “Oyun Teorisinin Mahiyeti ve Oyunlar,” İÜİFMİÜİFM 29 no. 129 no. 1--4, 1969.4, 1969.

140 Robert Skidelsky argues that the criteria behind the success or failRobert Skidelsky argues that the criteria behind the success or failure of capitalism are ure of capitalism are considered as the material consequences it brings about in the thought of Keynes. The considered as the material consequences it brings about in the thought of Keynes. The historical mission of capitalism is to provide welfare for all and as long as it discharges historical mission of capitalism is to provide welfare for all and as long as it discharges this mission, it is considered to be in safe. Alp Yücel this mission, it is considered to be in safe. Alp Yücel Kaya and M. Erdem Özgür, “İki Kaya and M. Erdem Özgür, “İki Neoliberalizm Hikayesi: Büyük Savaş Sonrası Gündem Tartışmaları,” in Neoliberalizm Hikayesi: Büyük Savaş Sonrası Gündem Tartışmaları,” in John Maynard John Maynard Keynes, Yine, Yeniden, Keynes, Yine, Yeniden, eds. Deniz Taner Kılınçoğlu and Emre Özçelik (İstanbul: İletişim eds. Deniz Taner Kılınçoğlu and Emre Özçelik (İstanbul: İletişim Yayınları, 2016), 61.Yayınları, 2016), 61.

141 For detailed explanations on thFor detailed explanations on the calculation debate, see Fikret Adaman and Pat e calculation debate, see Fikret Adaman and Pat Devine, “The Economic Calculation Debate: Lessons for Socialists,” Devine, “The Economic Calculation Debate: Lessons for Socialists,” Cambridge Journal Cambridge Journal of Economics of Economics 20, no. 5 (September 1996): 52320, no. 5 (September 1996): 523--537.537.

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proving the supremacy of the capitalist system.

proving the supremacy of the capitalist system.142 Mises, HayekMises, Hayek and and Robbins were parties of this idea; while Lange, Lerner and Dobb were Robbins were parties of this idea; while Lange, Lerner and Dobb were the advocates of the advocates of the counter argument. Particularly, the work of Oskar the counter argument. Particularly, the work of Oskar LangeLange143 in 1937, vindicin 1937, vindicaating the use of the market pricing tools in a ting the use of the market pricing tools in a socialist system became a reference guide.socialist system became a reference guide. Although this debate became Although this debate became widely influential in England the US and Germany since the 1920s for widely influential in England the US and Germany since the 1920s for many years, it somehow remained superficial in Turkey with few excep-many years, it somehow remained superficial in Turkey with few excep-tions. In fact, there were various references to socialism through the tions. In fact, there were various references to socialism through the articles and books,articles and books, but but mostly in a critical manner. However, there exists mostly in a critical manner. However, there exists a prominent exception, that is the translation of the British Marxist His-a prominent exception, that is the translation of the British Marxist His-torian Maurice Dobb’s “Ekonomi Nazariyesinin Sosyalist Ekonomiye torian Maurice Dobb’s “Ekonomi Nazariyesinin Sosyalist Ekonomiye Tatbikine Dair Münakaşanın Tetkiki”Tatbikine Dair Münakaşanın Tetkiki” (A Review of the Discussion Con-(A Review of the Discussion Con-cerning Economic Calculation in a Socialist Economy)cerning Economic Calculation in a Socialist Economy) which was pub-which was pub-lished in 1940, in the second issue of the lished in 1940, in the second issue of the Journal of the Faculty of Eco-Journal of the Faculty of Eco-nomics. nomics. Interestingly and unlike many other Interestingly and unlike many other translated materials, the translated materials, the name of the translator of this article is absentname of the translator of this article is absent. Even so, this proves that . Even so, this proves that the academia was cognizant of this debate and the publication of Dobb’s the academia was cognizant of this debate and the publication of Dobb’s article, who was a party to the socialism side of this debatearticle, who was a party to the socialism side of this debate,, is is notewor-notewor-thythy. Another brief mention to the calculat. Another brief mention to the calculatiion debate occurs in an article on debate occurs in an article of liberaof liberall--minded academic economist Oktay Yenal’s “İktisat Siyaseti ve minded academic economist Oktay Yenal’s “İktisat Siyaseti ve Plan” Plan” (Economic Policy and Plan) (Economic Policy and Plan) in 1958. Although Yenal claims that in 1958. Although Yenal claims that debating ondebating on centralized administration in Turkey sounds quite hypo-centralized administration in Turkey sounds quite hypo-thetical thetical –– since he considers the bureaucracy and administsince he considers the bureaucracy and administrative mech-rative mech-anism as the most anism as the most underdeveloped parts of a less developed countrunderdeveloped parts of a less developed countryy144 –– he acknowledges that utilizing the calculation function of price system he acknowledges that utilizing the calculation function of price system is also possibleis also possible underunder a centralized administration by referring to a centralized administration by referring to

142 Maurice Dobb, “Ekonomi Nazariyesinin Sosyalist Ekonomiye Tatbikine DaiMaurice Dobb, “Ekonomi Nazariyesinin Sosyalist Ekonomiye Tatbikine Dair r Münakaşanın Tetkiki,” Münakaşanın Tetkiki,” İÜİFMİÜİFM 2, (1940): 200. Fikret Adaman and Yahya Madra, “Top-2, (1940): 200. Fikret Adaman and Yahya Madra, “Top-lumsalın İktisadileşmesi mi, İktisadın Toplumsallaşması mı?,” in lumsalın İktisadileşmesi mi, İktisadın Toplumsallaşması mı?,” in Sosyal Bilimler Ne İşe Sosyal Bilimler Ne İşe Yarar? Yarar? (İstanbul: Boğaziçi Üniversitesi Yayınevi, 2013), 83. (İstanbul: Boğaziçi Üniversitesi Yayınevi, 2013), 83.

143 Lange was considered aLange was considered among the most significant mathematical economists and mong the most significant mathematical economists and figures of the neoclassical economics who came from a Marxist tradition. figures of the neoclassical economics who came from a Marxist tradition.

144 Oktay Yenal, “İktisat Siyaseti ve Plan,” Oktay Yenal, “İktisat Siyaseti ve Plan,” İÜİFM İÜİFM 20, no. 120, no. 1--4 (1958): 241. 4 (1958): 241.

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Lange’s and Lerner’s diligent anal

Lange’s and Lerner’s diligent analysis on this issue.ysis on this issue.145 Yet, he puts em-Yet, he puts em-phasis on the defects of such a powerful authority of state by arguing phasis on the defects of such a powerful authority of state by arguing that such a situation would bring about some certain political impacts, that such a situation would bring about some certain political impacts, by laying the groundwork for totalitarian behaviors.by laying the groundwork for totalitarian behaviors.146 That is to say, That is to say, Yenal’sYenal’s acknowledgment of the feasibility of calculation in a socialist acknowledgment of the feasibility of calculation in a socialist economy doesn’t refer to an advocacy for the socialist systemeconomy doesn’t refer to an advocacy for the socialist system indeedindeed..

It seems like

It seems like that that the arguments for an alternative system were not the arguments for an alternative system were not that prevalent; on the other hand, what was conspicuothat prevalent; on the other hand, what was conspicuously apparent is usly apparent is the insistent emphasis on an adherence to capitalism through the uni-the insistent emphasis on an adherence to capitalism through the uni-versity publications. versity publications. WWhat might be hat might be thethe reasons behinreasons behindd such a constant such a constant adherence? What were the characteristics and boundaries of the local adherence? What were the characteristics and boundaries of the local version of a “revised and necesversion of a “revised and necessarily ameliorated” version of capital-sarily ameliorated” version of capital-ism? In this section, given the socioeconomic context and mental struc-ism? In this section, given the socioeconomic context and mental struc-ture, I will ture, I will contemplatecontemplate on the potential reasons both behind carefully on the potential reasons both behind carefully remaining out of the current socialism debates and the constant efforts remaining out of the current socialism debates and the constant efforts to mto maintain the capitalist system, by trying to build bridges between the aintain the capitalist system, by trying to build bridges between the policy preferences of the governing elites and the attitudes of academic policy preferences of the governing elites and the attitudes of academic economists.economists.

8.1

8.1 Ideological OrientationsIdeological Orientations until the end of the Second until the end of the Second World WarWorld War

8.1.2

8.1.2 Defensing Capitalism afteDefensing Capitalism after the Great Depression: The r the Great Depression: The Position of AcademiaPosition of Academia

The opening scene of this conspicuous defen

The opening scene of this conspicuous defensse of capitalism begins e of capitalism begins with the first publication of the Institute for Economics and Sociology, with the first publication of the Institute for Economics and Sociology,

145 Ibid., 240.Ibid., 240.

146 Ibid., 240.Ibid., 240.

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the premise institution of the Faculty of Economics founded just o

the premise institution of the Faculty of Economics founded just one ne year after the 1933 University Reform. The year after the 1933 University Reform. The IInstitute was identified as a nstitute was identified as a center of science, which would work for the development of science, center of science, which would work for the development of science, welfare and cultural improvement of the country without coming under welfare and cultural improvement of the country without coming under the influence of any ideological purpose orthe influence of any ideological purpose or adhering to any dogmas.adhering to any dogmas.147 Yet, the first publication of the institute, namely Yet, the first publication of the institute, namely Ökonominin Bugünkü Ökonominin Bugünkü Meseleleri, Meseleleri, which was composed of the articles of the founding figures, which was composed of the articles of the founding figures, that are Wilhelm Röpke, Alexander Rüstow, Gerhard Kessler, Fritz Neu-that are Wilhelm Röpke, Alexander Rüstow, Gerhard Kessler, Fritz Neu-mark, Muhlis Ete, Şmark, Muhlis Ete, Şükrü Baban, Ömer Celal Sarc, İbrahim Fazıl Pelin and ükrü Baban, Ömer Celal Sarc, İbrahim Fazıl Pelin and Ali Özeken; Ali Özeken; represents a strong defense of the capitalist system with represents a strong defense of the capitalist system with respect to the alternative systemsrespect to the alternative systems.. This is remarkable when we think This is remarkable when we think that the book was published just five years after the Great Deprthat the book was published just five years after the Great Depression, ession, the great depression of capitalism indeed. However, the main axis the great depression of capitalism indeed. However, the main axis through the texts is centered around the question of whether this de-through the texts is centered around the question of whether this de-pression should be identified just as a crisis in the capitalist system or it pression should be identified just as a crisis in the capitalist system or it represents for a crisis of the capitrepresents for a crisis of the capitalist system itself. The answers in the alist system itself. The answers in the articles were generally oriented to prove the validity of the first option.articles were generally oriented to prove the validity of the first option.

Let us remember that t

Let us remember that the book begins with an influential article of a he book begins with an influential article of a former socialist German émigré economist Alexander Rüstow: “former socialist German émigré economist Alexander Rüstow: “Capital-Capital-ismism is not a system to be in love with” claims Rüstow; “it is an instru-is not a system to be in love with” claims Rüstow; “it is an instru-ment to achieve the goal.”ment to achieve the goal.”148 But he also mentions that capitalism is the But he also mentions that capitalism is the least disadvantageous one with respect to other economic systems.least disadvantageous one with respect to other economic systems.149 He asks: “How socialism would provide the elasticHe asks: “How socialism would provide the elasticity of capitalism, with ity of capitalism, with what the competition system would be changed for in a socialist econ-what the competition system would be changed for in a socialist econ-omy?”omy?”150 Wilhelm Röpke, the head of the institute, seems even more Wilhelm Röpke, the head of the institute, seems even more reconciled with the system which restrained himself from calling as reconciled with the system which restrained himself from calling as capitalism, with the concern ofcapitalism, with the concern of bringing the Marxian terminology on bringing the Marxian terminology on

147 Wilhelm Röpke, Wilhelm Röpke, ÖkonÖkonominin Bugünkü Meseleleri ominin Bugünkü Meseleleri (İstanbul: İstanbul Üniversitesi Hukuk (İstanbul: İstanbul Üniversitesi Hukuk Fakültesi İktisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934), preface.Fakültesi İktisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934), preface.

148 Alexander Rüstow, “İktisat Sistemi ve İktisat İdeolojisi,” in Alexander Rüstow, “İktisat Sistemi ve İktisat İdeolojisi,” in Ökonominin Bugünkü Ökonominin Bugünkü Meseleleri, Meseleleri, 17.17.

149 Ibid., 16.Ibid., 16.

150 Ibid.Ibid., 18., 18.

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class conflict in minds.

class conflict in minds.151 He prefers to say “our economic system” in-He prefers to say “our economic system” in-stead, which gives the reader a sense of neutrality, stead, which gives the reader a sense of neutrality, is is purified from purified from any any ideological labels.ideological labels.152 He asks “Is it relevant to crowd all the pain and He asks “Is it relevant to crowd all the pain and injustinjustice in the world into the concept of capitalism? Is it reasonable to ice in the world into the concept of capitalism? Is it reasonable to give up the whole mechanism because of somegive up the whole mechanism because of some problems in income dis-problems in income dis-tribution?” and then he answers: “No, we should not accuse the system tribution?” and then he answers: “No, we should not accuse the system de facto, for the de facto, for the presence of the presence of the disorder and chaodisorder and chaos.”s.”153

The assertive articles were not limited by the German economists.

The assertive articles were not limited by the German economists. İbrahim Fazıl Pelin who was identified as a stone age liberalİbrahim Fazıl Pelin who was identified as a stone age liberal154 by by RüstowRüstow155, claims that “This depression is morbid and transient which , claims that “This depression is morbid and transient which would not get capitalism into trouble. Although prowould not get capitalism into trouble. Although protectionism will not tectionism will not be annihilatedbe annihilated and states will continue to compensate for the inequali-and states will continue to compensate for the inequali-ties in the production conditions after the depression, protectionism ties in the production conditions after the depression, protectionism should not should not bebe defined as a doctrine, but as a policy, a practice.”defined as a doctrine, but as a policy, a practice.”156 Ömer Ömer Celal Sarc, who became Celal Sarc, who became a PhD student of Werner Sombart in Berlin Uni-a PhD student of Werner Sombart in Berlin Uni-versity, draws a remarkable analogy and claims that “the situation in the versity, draws a remarkable analogy and claims that “the situation in the world economy might be compared to a man who caught a temporary world economy might be compared to a man who caught a temporary and unimportant illness at a bad time which was severed due to the and unimportant illness at a bad time which was severed due to the mistakmistakes of the doctors, not a man with a chronical mortal disease ap-es of the doctors, not a man with a chronical mortal disease ap-peared at a time.”peared at a time.”157 Muhlis Ete, once a student of Adolph Wagner in Muhlis Ete, once a student of Adolph Wagner in

151 Wilhelm Röpke, Wilhelm Röpke, Cemiyet Ekonomisi Cemiyet Ekonomisi (İstanbul: İstanbul Üniversitesi, 1937), 222.(İstanbul: İstanbul Üniversitesi, 1937), 222.

152 Although it would be a farAlthough it would be a far--fetched approach to draw a direct line between the fetched approach to draw a direct line between the neoliberalism of the 1980s and Röpke’s discourse, Röpke’s portrayal style of the sys-neoliberalism of the 1980s and Röpke’s discourse, Röpke’s portrayal style of the sys-tetem reminds the propaganda of neoliberal prescriptions to the third world countries m reminds the propaganda of neoliberal prescriptions to the third world countries as a recipe which has supposed to have “no alternative” during the 1980s. Here in as a recipe which has supposed to have “no alternative” during the 1980s. Here in Röpke’s writing, one can feel that the capitalist system is mentioned as the only rea-Röpke’s writing, one can feel that the capitalist system is mentioned as the only rea-sonablesonable alternative one among the repertoire of various systems.alternative one among the repertoire of various systems.

153 Wilhelm Röpke, “Piyasa İktisadının Kuruluşu ve Mekanizması,” in Wilhelm Röpke, “Piyasa İktisadının Kuruluşu ve Mekanizması,” in Ökonominin Bugünkü Ökonominin Bugünkü Meseleleri, Meseleleri, 3535--36.36.

154 This term refers to the adherence of Cavit Bey Economics, signifying the FrenchThis term refers to the adherence of Cavit Bey Economics, signifying the French--influencedinfluenced old fashioned economist.old fashioned economist.

155 Fritz Neumark, Fritz Neumark, Boğaziçine Sığınanlar, Boğaziçine Sığınanlar, 83.83.

156 İbrahim Fazıl Pelin, “Beynelmilel Ticaret Siyasetinin Tekamülü ve Bugünkü Himaye İbrahim Fazıl Pelin, “Beynelmilel Ticaret Siyasetinin Tekamülü ve Bugünkü Himaye Tekniği,” in Tekniği,” in Ökonominin Bugünkü Meseleleri, Ökonominin Bugünkü Meseleleri, 6060--61.61.

157 Ömer Celal Sarc, “Konjonktür ve Buhranlar,” in Ömer Celal Sarc, “Konjonktür ve Buhranlar,” in Ökonominin Bugünkü Meseleleri, Ökonominin Bugünkü Meseleleri, 87.87.

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Leipzig University, also seems quite sure on the inefficiency of the so-

Leipzig University, also seems quite sure on the inefficiency of the so-cialist systemcialist system: “Real Bolshevism is much far away from : “Real Bolshevism is much far away from being the unique being the unique rescuer of the humanity.”rescuer of the humanity.”158 Although this crisis was defined as a de-Although this crisis was defined as a de-pression pression ofof the system by Gerhard Kessler, who would be the pioneer the system by Gerhard Kessler, who would be the pioneer figure of a new social policy and sociology approach at the prospective figure of a new social policy and sociology approach at the prospective faculty of economics, it is alsofaculty of economics, it is also mentioned by him that “the efforts to mentioned by him that “the efforts to compensate the principality of capitalism with the pressure of state are compensate the principality of capitalism with the pressure of state are all wrong. The social affairs of capitalism; are not matters of organiza-all wrong. The social affairs of capitalism; are not matters of organiza-tion, but issues of the nonmaterial beliefs and faith.tion, but issues of the nonmaterial beliefs and faith.””159

There is one mo

There is one more crucial article in the book which I would like to re crucial article in the book which I would like to place a particular focus on. It is Şükrü Baban’s article on “Marxism”. Ba-place a particular focus on. It is Şükrü Baban’s article on “Marxism”. Ba-ban was acknowledged to be among the academic figures who were ban was acknowledged to be among the academic figures who were most recognizant of Marx then.most recognizant of Marx then.160 Yet, in this article, he Yet, in this article, he notesnotes thatthat he he will scrutinize the issue only in a technical manner, without mentioning will scrutinize the issue only in a technical manner, without mentioning the reflections of the political and social ambitions or storms around the reflections of the political and social ambitions or storms around Marxism; and he does so in the following parts of his writing. This Marxism; and he does so in the following parts of his writing. This would not be surprising for a reader whowould not be surprising for a reader who is familiar with his sensitivity is familiar with his sensitivity on objectivityon objectivity161 in the economics textbook of him published in 1957. in the economics textbook of him published in 1957. However, the remarkable part in this article lies at the beginning. He However, the remarkable part in this article lies at the beginning. He claims that “since a healthy person is able to do various activities with claims that “since a healthy person is able to do various activities with ease, he/ease, he/she could only appreciate the value this felicity when he/she she could only appreciate the value this felicity when he/she gets ill and becomes unable to do them.”gets ill and becomes unable to do them.”162 It might be unexpected to It might be unexpected to confront with such an introduction in an article about Marxism; but in confront with such an introduction in an article about Marxism; but in

158 Muhlis Ete, “Devletçilik ve Planlı Ökonomi,” in Muhlis Ete, “Devletçilik ve Planlı Ökonomi,” in Ökonominin Bugünkü Meseleleri, Ökonominin Bugünkü Meseleleri, 96.96.

159 Gerhard Kessler, “Kapitalizmin Sosyal Meseleleri,” in Gerhard Kessler, “Kapitalizmin Sosyal Meseleleri,” in Ökonominin Bugünkü Meseleleri, Ökonominin Bugünkü Meseleleri, 129.129.

160 Besim Üstünel claimed this argument foBesim Üstünel claimed this argument for Baban. Sencer Divitçioğlu also appreciated r Baban. Sencer Divitçioğlu also appreciated Baban’s knowledge on Marx. Panel “Duayen Hocalar İktisadı Tartışıyor,” Baban’s knowledge on Marx. Panel “Duayen Hocalar İktisadı Tartışıyor,” İktisat Dergisi İktisat Dergisi 481481--482 January February (2007):15.482 January February (2007):15.

161 Baban in the preface of his economics textbook mentioned that the most debateable Baban in the preface of his economics textbook mentioned that the most debateable conconcepts like value, labor, capital and wage will be portrayed within the objectivity of a cepts like value, labor, capital and wage will be portrayed within the objectivity of a photographer. The results will be enlisted without laying too much emphasis on the photographer. The results will be enlisted without laying too much emphasis on the ideas of various ecoles. ideas of various ecoles. Baban, Baban, İktisad, İktisad, vv..

162 Şükrü Baban, “Marxism,” in Şükrü Baban, “Marxism,” in Ökonominin Ökonominin Bugünkü Meseleleri, Bugünkü Meseleleri, 177.177.

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fact, he likens this situation for being able to write

fact, he likens this situation for being able to write on Marxism in this on Marxism in this country: country: ““The importance of The importance of the ability of mentioning the system of the ability of mentioning the system of Marxism should be compared with the Marxism should be compared with the ininability of referring to Marx in ability of referring to Marx in Italy and Germany. The Republic of Turkey, Italy and Germany. The Republic of Turkey, whose founders are com-whose founders are com-plaisant to ideas, is so plaisant to ideas, is so steadysteady toto be anxious about various social flows be anxious about various social flows and dogmas.and dogmas.””163 Having the need for such an emphasis is worth making Having the need for such an emphasis is worth making further considerations.further considerations.

In evaluating the attitudes of the academics, one should remind

In evaluating the attitudes of the academics, one should remind him/herself that this book was published in the year the firsthim/herself that this book was published in the year the first fivefive--year year plan was borrowed from the Soviets. The vigorous efforts to prove the plan was borrowed from the Soviets. The vigorous efforts to prove the supremacy of capitalism then, might have arisen from an anxiety about supremacy of capitalism then, might have arisen from an anxiety about a probable shift towards a collectivist system in Turkey although Baban a probable shift towards a collectivist system in Turkey although Baban seems to feel relieved in this seseems to feel relieved in this sense. Actually, Röpke and all the other nse. Actually, Röpke and all the other authors were by all means aware of the empowering of the leftist alter-authors were by all means aware of the empowering of the leftist alter-natives natives at that current momentat that current moment, but these alternatives were not de-, but these alternatives were not de-mandmanded ed by them. by them. Indeed, at the beginning of his article, Röpke was urg-Indeed, at the beginning of his article, Röpke was urg-ing upon thing upon the fact that here at the universities, the subjects should be e fact that here at the universities, the subjects should be just concerned with doing science, not politics. Therefore,just concerned with doing science, not politics. Therefore, according to according to him,him, arriving at a decision in favor of or against a system can just be a arriving at a decision in favor of or against a system can just be a result of a political decision outside scientifiresult of a political decision outside scientific conceptualizations as it is c conceptualizations as it is not possible to scientifically prove whether capitalism or socialism is not possible to scientifically prove whether capitalism or socialism is more preferable.more preferable.164 Notwithstanding, we are confronted with various Notwithstanding, we are confronted with various discoursesdiscourses of himof him in favor of a revised version of in favor of a revised version of aa capitalist system capitalist system through his writithrough his writings. Indeed, he might be characterized as an inexhaust-ngs. Indeed, he might be characterized as an inexhaust-ible warrior against the socialist ideas.ible warrior against the socialist ideas.165

163 Baban, “Marxism,” 177.Baban, “Marxism,” 177.

164 Such a preference Such a preference for Röpke, for Röpke, can just be a result of a political decision outside a can just be a result of a political decision outside a scientific conceptualization. He refers to Cairness who said economics should remain scientific conceptualization. He refers to Cairness who said economics should remain as neutral as mechanics does in tas neutral as mechanics does in the face of preference of different ways of constructing he face of preference of different ways of constructing railways. railways. FFor him, here at the universities, as we are just interested in science, not or him, here at the universities, as we are just interested in science, not politics; hence we don’t arrive at a decision in favor of or against a system.politics; hence we don’t arrive at a decision in favor of or against a system. Röpke, Röpke, “Piyasa İktisadının,” 25.“Piyasa İktisadının,” 25.

165 Adolf Jöhr in his translated article mentions that the renaissance of the idea of Adolf Jöhr in his translated article mentions that the renaissance of the idea of competition in Switzerland found its most vigorous advocate in the person of Röpke. competition in Switzerland found its most vigorous advocate in the person of Röpke.

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In case of the presence of such an influential figure like Röpke at the

In case of the presence of such an influential figure like Röpke at the faculty, it might not be that feasible to initiate discussions defensing so-faculty, it might not be that feasible to initiate discussions defensing so-cialism as hcialism as he already seems to put an end to potential debates by mas-e already seems to put an end to potential debates by mas-terminding the discussion himself for most of the time. terminding the discussion himself for most of the time. BBesides, the esides, the émigré economists cannot already be characterized as socialists. So, émigré economists cannot already be characterized as socialists. So, they might have considered such discussions on socialism as tthey might have considered such discussions on socialism as too theo-oo theo-retical and superficial for Turkey, a country in which even a capitalistic retical and superficial for Turkey, a country in which even a capitalistic development process development process was notwas not really experienced and a consolidated really experienced and a consolidated powerful working class powerful working class was notwas not emanated till that time. emanated till that time. AAlthough Neu-lthough Neu-mark and Kessler seemed more tendentiousmark and Kessler seemed more tendentious to leftist policies to some to leftist policies to some degree,degree, their adherence to an updated and applicable liberalism were their adherence to an updated and applicable liberalism were more at the forefront. Considering the reason why they left their own more at the forefront. Considering the reason why they left their own countcountry, their efforts to stand aloof from the ideologies that bear the ry, their efforts to stand aloof from the ideologies that bear the traces of totalitraces of totalitarian implementations become more understandable. tarian implementations become more understandable. What they primarily aspired to achieve was a solid baseline for order What they primarily aspired to achieve was a solid baseline for order and freedom, which were expected to be provided in between the and freedom, which were expected to be provided in between the boundaries of the capitalistic framework. boundaries of the capitalistic framework.

All these publications in the

All these publications in the 1930s provide important clues about 1930s provide important clues about the frontiers of the economics established thereafter, as well as how and the frontiers of the economics established thereafter, as well as how and why the core constituents of the discipline were interrelated with the why the core constituents of the discipline were interrelated with the capitalist system. Neither in the articles on social policy, nor on devel-capitalist system. Neither in the articles on social policy, nor on devel-oopment economics, one would easily be confronted with a strong voice pment economics, one would easily be confronted with a strong voice defensing the vitality of an alternative system. All the instruments for defensing the vitality of an alternative system. All the instruments for solving the current problems of the economy were selected from capi-solving the current problems of the economy were selected from capi-talism’s toolbotalism’s toolboxx. But there is one important thi. But there is one important thing to be ng to be notednoted at this at this point: although mostly remaining within the capitalistic framework, point: although mostly remaining within the capitalistic framework,

Walter Adolf Jöhr, “Rekabet Fikrinin Yeniden Doğması ve Nazari İktisat,”

Walter Adolf Jöhr, “Rekabet Fikrinin Yeniden Doğması ve Nazari İktisat,” İÜİFMİÜİFM 5, no. 15, no. 1--4 (1945): 84 (1945): 8--9. The author points out the importance of the role played by Röpke in the 9. The author points out the importance of the role played by Röpke in the revival of the ideas on competition even in 1929. Remarkably, he also puts forth that revival of the ideas on competition even in 1929. Remarkably, he also puts forth that Röpke’s desire to shine a torch in front of a new era and play a role like RousseauRöpke’s desire to shine a torch in front of a new era and play a role like Rousseau’s ’s Contrat Social Contrat Social and Marx and Engel’s and Marx and Engel’s Communist Manifesto, Communist Manifesto, becomes evident in an arti-becomes evident in an arti-cle of him, in which he claims “the panorama to be presented in tomorrow’s world, is cle of him, in which he claims “the panorama to be presented in tomorrow’s world, is being prepared in a few writing desks today”. Ibid., 14. being prepared in a few writing desks today”. Ibid., 14.

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both the local and émigré

both the local and émigré academics academics in Turkey in Turkey dedicatedly intended to dedicatedly intended to moderate its boundaries. They almost never adopted the capitalism as it moderate its boundaries. They almost never adopted the capitalism as it is, but strived for trais, but strived for transforming it into another thing; to a more humane, nsforming it into another thing; to a more humane, more applicable version. Based on my observations in this study, I can more applicable version. Based on my observations in this study, I can say that this argument is valid ranging from the most liberal and the say that this argument is valid ranging from the most liberal and the most leftist academics, as a common denominator. most leftist academics, as a common denominator.

8.1.3

8.1.3 CCapitapitalism for Development: Calism for Development: Creatireation ofon of a “a “NaNational tional EEcono-cono-my” my” in the Early Republican Erain the Early Republican Era

After propounding this, I would like to contextualize the dynamics of

After propounding this, I would like to contextualize the dynamics of this adherence of an “revised and ameliorated version of capitalism” by this adherence of an “revised and ameliorated version of capitalism” by interfacing interfacing this loyalty withthis loyalty with the current economic conditions. First, it the current economic conditions. First, it would be meaningful to remind the economic conjuncture which might would be meaningful to remind the economic conjuncture which might be identified by the various appearances of the “national economy” ap-be identified by the various appearances of the “national economy” ap-proach, influenced by the ideas of German Friedrich Listproach, influenced by the ideas of German Friedrich List166 since the since the Second CSecond Constitutional Monarchy years. This conception required the onstitutional Monarchy years. This conception required the creation of a national bourgeoisie by statist policies creation of a national bourgeoisie by statist policies –– due to the ab-due to the ab-sence of such a groupsence of such a group –– oon the way of national development. The prima-n the way of national development. The prima-cies of economic policies were designed in accordance withcies of economic policies were designed in accordance with this pur-this pur-pose. That is to say, the decisiveness to stay pose. That is to say, the decisiveness to stay within the framework of the within the framework of the system was not a product of the new regime, but a preexisting tendency. system was not a product of the new regime, but a preexisting tendency. The presence of both the liberal and protectionist veins in economics The presence of both the liberal and protectionist veins in economics education in the Ottoman Empireducation in the Ottoman Empire, each becoming prominent in accord-e, each becoming prominent in accord-ance with the changing conditions, can also be considered as an element ance with the changing conditions, can also be considered as an element ooff continuity in the Republican era when we think of the oscillations continuity in the Republican era when we think of the oscillations

166 It is remarkable that LiIt is remarkable that List was not translated into Turkish until 1927. The Turkish st was not translated into Turkish until 1927. The Turkish policy makers have learned List from Gide and Cauwes. Ercan Eren, “Küreselleşme ve policy makers have learned List from Gide and Cauwes. Ercan Eren, “Küreselleşme ve Regülasyon Evreleri:19. Yüzyıldan 21. Yüzyıla… Regülasyon Evreleri:19. Yüzyıldan 21. Yüzyıla… -- Zafer Toprak,” May 5, 2023, video, Zafer Toprak,” May 5, 2023, video, https://www.youtube.com/watch?https://www.youtube.com/watch?v=E8bnTO9Zrws.v=E8bnTO9Zrws.

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between the liberal and statist tendencies within the framework of capi-

between the liberal and statist tendencies within the framework of capi-talist talist national economy.national economy.

Another element of continuity that supports the maintenance of cap-

Another element of continuity that supports the maintenance of cap-italism, can be described as the efforts to construct a society with the italism, can be described as the efforts to construct a society with the idea of solidarism. Ziya Gökalp’s Durkheimidea of solidarism. Ziya Gökalp’s Durkheim--inflected legacinflected legacyy had an im-had an im-mense influence on the governimense influence on the governing elites. This was reinforced by the im-ng elites. This was reinforced by the im-pressive impact of Charles Gide, the French author of widely dissemi-pressive impact of Charles Gide, the French author of widely dissemi-nated and translated economics books. nated and translated economics books. Although it is not that easy to Although it is not that easy to imagine solidarism and capitalism together, it should be noted that the imagine solidarism and capitalism together, it should be noted that the maintemaintenance of capitalism nance of capitalism was expected to be consolidated by the em-was expected to be consolidated by the em-phasis on solidarism which sees society as an organic whole with the phasis on solidarism which sees society as an organic whole with the intent of eliminating class conflict. And in Turkey,intent of eliminating class conflict. And in Turkey, pparallel with the es-arallel with the es-tablishment of the national economy ideal, achieving tablishment of the national economy ideal, achieving the goal of a crea-the goal of a crea-tion of a capitalist bourgeoisie class came to the forefront and the provi-tion of a capitalist bourgeoisie class came to the forefront and the provi-sion of a social order without class conflict was highly desired. Populism sion of a social order without class conflict was highly desired. Populism principle, within which the collaboration of interests was emphasized, principle, within which the collaboration of interests was emphasized, was based on this was based on this ideal in a sense. In prevention ofideal in a sense. In prevention of aa class conflict, pro-class conflict, pro-letarianization was mostly impeded by the policies aiming to keep the letarianization was mostly impeded by the policies aiming to keep the peasants at rural, although this was somehow ironic in a country which peasants at rural, although this was somehow ironic in a country which aimed a rapid industrialization process. But in one respectaimed a rapid industrialization process. But in one respect, there exists , there exists a coherency in between the results of these policies and the recommen-a coherency in between the results of these policies and the recommen-dations of Röpke and Rüstow in the 1930s. Röpke also advocated for the dations of Röpke and Rüstow in the 1930s. Röpke also advocated for the provision of some incentives for “köycülük”provision of some incentives for “köycülük” ((peasantism) peasantism) in order to get in order to get rid of the proletariat withirid of the proletariat within the framework of the capitalist system.n the framework of the capitalist system.167 And Rüstow, unlike the dominant industrialization paAnd Rüstow, unlike the dominant industrialization parradigm in the adigm in the 1930s, considered the mainland of a robust and regenerated liberalism 1930s, considered the mainland of a robust and regenerated liberalism as agriculture instead of industry by safeguarding the market and com-as agriculture instead of industry by safeguarding the market and com-petitionpetition principles.principles.168 We all know that, despite the rapid industrializa-We all know that, despite the rapid industrializa-tion efforts, the main source of the export income was provided by the tion efforts, the main source of the export income was provided by the

167 Röpke, Röpke, Cemiyet, Cemiyet, 220220--221. Adolf Jöhr also touches upon Röpke’s viewpoint which 221. Adolf Jöhr also touches upon Röpke’s viewpoint which presents the eligibility of an economic system in which the middle classes prevail, presents the eligibility of an economic system in which the middle classes prevail, eluding proletarianization. Jöhr, “Rekabet Fikrinin,” 10.eluding proletarianization. Jöhr, “Rekabet Fikrinin,” 10.

168 Rüstow, “İktisRüstow, “İktisat Sistemi,” 20.at Sistemi,” 20.

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agricultural sector both in the 1920s and 1930s, but the economic poli-

agricultural sector both in the 1920s and 1930s, but the economic poli-cy makers were never contended with solely being an cy makers were never contended with solely being an agricultural socie-agricultural socie-ty.ty.

On the way of industrialization, the economic policies during the

On the way of industrialization, the economic policies during the 1930s also represented a search 1930s also represented a search forfor a third way in between the liberal a third way in between the liberal and socialist economies. The concept of “economie dirigée” of the and socialist economies. The concept of “economie dirigée” of the French Economist Gaetan Pirou sFrench Economist Gaetan Pirou seems to be appreciated by the policy eems to be appreciated by the policy makers when we consider the speeches of Atatürk and Celal Bayar in makers when we consider the speeches of Atatürk and Celal Bayar in the mentioned decade.the mentioned decade.169 The primary role of Bayar in the implementa-The primary role of Bayar in the implementa-tion of these étatist policies might be received with astonishment by the tion of these étatist policies might be received with astonishment by the readers who readers who are familiar with the liberal viewpoint of him. But the pur-are familiar with the liberal viewpoint of him. But the pur-pose at that time was the fiscal independencepose at that time was the fiscal independence,, and étatism then should and étatism then should not be received as a political or ideological motivation, but a prerequi-not be received as a political or ideological motivation, but a prerequi-site for further development. One should keep in mind site for further development. One should keep in mind that étatism in that étatism in Turkey Turkey –– although the plan was borrowed from the Soviets although the plan was borrowed from the Soviets –– never car-never car-ried the soul of a socialist ideology; on the contrary, it was considered as ried the soul of a socialist ideology; on the contrary, it was considered as a phase of the capitalist development path. The use of the concept a phase of the capitalist development path. The use of the concept wawas s quite softened in the diquite softened in the discourses of the Republicans, but it shscourses of the Republicans, but it shooululdd not be not be disregarded that the notion of state had an especial aura during the in-disregarded that the notion of state had an especial aura during the in-terwar years.terwar years.170 As briefly summarized by Muhlis Ete, As briefly summarized by Muhlis Ete, ““Turkish étatism Turkish étatism carries out an idiosyncratic character, just carries out an idiosyncratic character, just likelike the Turkish the Turkish inkılâpinkılâp (revo-(revo-lution)lution).”.”171

Coinciding with the étatist policy implementations in the early

Coinciding with the étatist policy implementations in the early 1930s, there occurred a center for the production of knowledge on eco-1930s, there occurred a center for the production of knowledge on eco-nomic thought outside the university, namely the nomic thought outside the university, namely the KadroKadro journal (1932journal (1932--1935). The 1935). The publicationpublication of the of the journal journal came to an end came to an end before the founda-before the founda-tion of the faculty of economics; but its impact on both the emancipa-tion of the faculty of economics; but its impact on both the emancipa-tion of economics from law and the economic thought produced in cur-tion of economics from law and the economic thought produced in cur-

169 Kağan Öğüt and Cenk Yaltırak, “Kemalizmin Ekonomi Politiğinde Unutulmuş Bir Sayfa: Kağan Öğüt and Cenk Yaltırak, “Kemalizmin Ekonomi Politiğinde Unutulmuş Bir Sayfa: Güdümlü Ekonomi,” in Güdümlü Ekonomi,” in Türkiye’de İktisadi Düşünce, Türkiye’de İktisadi Düşünce, 170.170.

170 Ercan Eren, “Küreselleşme ve Regülasyon Evreleri:19. Yüzyıldan 21. Yüzyıla… Ercan Eren, “Küreselleşme ve Regülasyon Evreleri:19. Yüzyıldan 21. Yüzyıla… -- Zafer Zafer Toprak,” MaToprak,” May 5, 2023, video, https://www.youtube.com/watch?v=E8bnTO9Zrws.y 5, 2023, video, https://www.youtube.com/watch?v=E8bnTO9Zrws.

171 Ete, “Devletçilik ve,” 111.Ete, “Devletçilik ve,” 111.

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rent times was crucial. The journal was an original representative of a

rent times was crucial. The journal was an original representative of a proto deproto dependency school, composed of remarkable figurependency school, composed of remarkable figures who might s who might be identified as Kemalist socialists. The educational backgrounds of the be identified as Kemalist socialists. The educational backgrounds of the members would provide insights for their ideological positions: Şevket members would provide insights for their ideological positions: Şevket Süreyya Aydemir and İsmail Hüsrev Tökin were educated at Moscow, Süreyya Aydemir and İsmail Hüsrev Tökin were educated at Moscow, while Burhan Asaf Belge and Vedat Nwhile Burhan Asaf Belge and Vedat Nedim Tör at Germany. Tör became edim Tör at Germany. Tör became a student of Sombarta student of Sombart172, who was also an influential figure for the forth-, who was also an influential figure for the forth-coming faculty members of economics. This group might coming faculty members of economics. This group might have have bebeenen re-re-flective of a socialist alternative at those times, but the journal was flective of a socialist alternative at those times, but the journal was dis-dis-continuedcontinued dudue to the discrepancies between the viewpoints of its e to the discrepancies between the viewpoints of its members members –– which were reputed to be too radical which were reputed to be too radical –– and the governing and the governing elites. elites.

Now that the ephemeral experience of a proto

Now that the ephemeral experience of a proto--dependency ap-dependency ap-proach was over by the midproach was over by the mid--1930s, it would be meaningful to see the 1930s, it would be meaningful to see the ddominant tendencies in the newly founded faculty of economics. The ominant tendencies in the newly founded faculty of economics. The émigré Germans might be identified as the social liberals who aimed to émigré Germans might be identified as the social liberals who aimed to transform capitalism. It is true that the classical liberalism with laissez transform capitalism. It is true that the classical liberalism with laissez faire ideal had already fallen into disfavofaire ideal had already fallen into disfavor in the current times and the r in the current times and the German émigré economists were in the first place against the laissez German émigré economists were in the first place against the laissez faire liberalism. On the other hand, what they also tried was to substan-faire liberalism. On the other hand, what they also tried was to substan-tiate capitalism against the collectivist leakages.tiate capitalism against the collectivist leakages.173 Particularly Röpke Particularly Röpke and Rüstow wand Rüstow were the representatives of this new way of liberalism ere the representatives of this new way of liberalism within a social framework of the market economy. It was Alexander within a social framework of the market economy. It was Alexander Rüstow who became the economist coining the term “neoliberalism” at Rüstow who became the economist coining the term “neoliberalism” at the Walter Lippmann Colloquthe Walter Lippmann Colloquee in 1938.in 1938.174 And it was Wilhelm Röpke, And it was Wilhelm Röpke, whowho became the head of the Mont Pbecame the head of the Mont Pèèlerin Society lerin Society –– an organization in-an organization in-

172 Although the evaluations on capitalism of Marx and Sombart differ, Sombart’s ideas Although the evaluations on capitalism of Marx and Sombart differ, Sombart’s ideas include Marxian elements. For a detailed information, see Özgür and Kaya, “Kinclude Marxian elements. For a detailed information, see Özgür and Kaya, “Kadro’nun adro’nun Maddeci Tarihyazımı: Osmanlı ve Türkiye Tarihinde Derebeylik Rejimi,” in Maddeci Tarihyazımı: Osmanlı ve Türkiye Tarihinde Derebeylik Rejimi,” in Türkiye’de Türkiye’de İktisadi Düşünce, İktisadi Düşünce, 2017. As is mentioned in the article of Aydın Yalçın, Sombart was also 2017. As is mentioned in the article of Aydın Yalçın, Sombart was also recalled as an old Marxist by Hayek. Aydın Yalçın, “Esaret Yolu,” recalled as an old Marxist by Hayek. Aydın Yalçın, “Esaret Yolu,” AÜSBFAÜSBFDD 11, no. 4 , no. 4 (1943): 903.(1943): 903.

173 Kaya and Özgür, “İki Neoliberalizm,” 57.Kaya and Özgür, “İki Neoliberalizm,” 57.

174 https://en.wikipedia.org/wiki/Alexander_Rhttps://en.wikipedia.org/wiki/Alexander_Rüüstowstow

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spired by the Walter Lippmann Colloqu

spired by the Walter Lippmann Colloquee –– in between the years 1961 in between the years 1961 and 1962, after the 14 years presidency of Friedrich Hayek. They were and 1962, after the 14 years presidency of Friedrich Hayek. They were also named as also named as ““ordoliberalsordoliberals””, the word ordo coming fro, the word ordo coming from the name of m the name of the journal the journal ORDOORDO175 referring to order. Within this respect, what they referring to order. Within this respect, what they particularly emphasized becomes selfparticularly emphasized becomes self--transparent: the provision of a transparent: the provision of a social order. This ideal mostly found itself in Wilhelm Röpke’s writings, social order. This ideal mostly found itself in Wilhelm Röpke’s writings, who defined the system as a hiwho defined the system as a highly specialized configuration in a whole ghly specialized configuration in a whole anarchy; in other words, a disciplined anarchy. This economic anarchy, anarchy; in other words, a disciplined anarchy. This economic anarchy, unlike the political anarchy, appears as a uniform order, represents a unlike the political anarchy, appears as a uniform order, represents a cosmos, a realm of a harmony which should also be remunerated by the cosmos, a realm of a harmony which should also be remunerated by the proproponents of socialism for Röpke.ponents of socialism for Röpke.176

Another vein of liberalism was seen in Ankara University, represent-

Another vein of liberalism was seen in Ankara University, represent-ed by the academics like Aydın Yalçın and Fethi Çelikbaşed by the academics like Aydın Yalçın and Fethi Çelikbaş, both of whom , both of whom later became members of the Freedom Party founded in 1955, as a reac-later became members of the Freedom Party founded in 1955, as a reac-tion against thetion against the policies implemented by the Democrat Party. policies implemented by the Democrat Party. And each And each academic academic was engaged in some translations of Friedrich Hayek’s works was engaged in some translations of Friedrich Hayek’s works in the 1940s. Fethi Çelikbaş translated parts of in the 1940s. Fethi Çelikbaş translated parts of Collectivist Economic Collectivist Economic Planning Planning and mentioned that Hayek explains why socialism or coand mentioned that Hayek explains why socialism or collectiv-llectiv-ism could not perform the works transacted by competition. He referred ism could not perform the works transacted by competition. He referred to the calculation debate and claimed that the gravity center of the ob-to the calculation debate and claimed that the gravity center of the ob-jections against the economic systems that limit or abolish competition, jections against the economic systems that limit or abolish competition, is the impossibility of economic cis the impossibility of economic calculation, which results in a descend alculation, which results in a descend ofof social product.social product.177 The presence of such a reference to the calculation The presence of such a reference to the calculation debate in the 1940s proves for thedebate in the 1940s proves for the relevancy of the issue not only in Is-relevancy of the issue not only in Is-tanbul University but also in Ankara University. tanbul University but also in Ankara University. TThe other liberal aca-he other liberal aca-demdemic, Aydın Yalçın wrote on ic, Aydın Yalçın wrote on The Road to Serfdom,The Road to Serfdom, acknowledging the acknowledging the book as a perfect example that shows how the current social problems book as a perfect example that shows how the current social problems

175 The journal was published by Walter Eucken and Franz Böhm in 1948. Hayek, The journal was published by Walter Eucken and Franz Böhm in 1948. Hayek, Friedman, Haberler, Popper and Röpke were among the contributorsFriedman, Haberler, Popper and Röpke were among the contributors. . https://www.jstor.org/journal/ordojahrordnwirthttps://www.jstor.org/journal/ordojahrordnwirt. Eucken and Röpke also played key . Eucken and Röpke also played key roles in the Erhard government during when the German economic miracle took place.roles in the Erhard government during when the German economic miracle took place.

176 Röpke, Röpke, Cemiyet, Cemiyet, 66--7.7.

177 Fethi Çelikbaş, “Planlı Kollektivist İktisat,” Fethi Çelikbaş, “Planlı Kollektivist İktisat,” AÜSBFAÜSBFDD 1, no. 4 (1943): 791.1, no. 4 (1943): 791.

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should be handled under the object lessons of the recent years.

should be handled under the object lessons of the recent years.178 In the In the last part of his article, he kind of foresaw the flast part of his article, he kind of foresaw the future uture –– the revival of a the revival of a more powerful orientation towards the ideas of Hayek in the mid 1970s more powerful orientation towards the ideas of Hayek in the mid 1970s –– by claiming that by claiming that ““Hayek might be resembled to Zarathustra who con-Hayek might be resembled to Zarathustra who con-templates on his own without having the ear of many, but there is no templates on his own without having the ear of many, but there is no fear of this situation. Dfear of this situation. Dissemination of an idea among the masses takes a issemination of an idea among the masses takes a long time.long time.””179

After this brief parenthesis on the liberal voices in Ankara Universi-

After this brief parenthesis on the liberal voices in Ankara Universi-ty, I would like to turn back to Istanbul University and elaborate more ty, I would like to turn back to Istanbul University and elaborate more on the general atmosphere. Apart from the viewpoints on the general atmosphere. Apart from the viewpoints of Rüstow and of Rüstow and Röpke, who both experienced some transformations after nourishing Röpke, who both experienced some transformations after nourishing from each other’s viewsfrom each other’s views,,180 the ideological panorama of the academic the ideological panorama of the academic cadre in the faculty represents a heterogeneity, both in their political cadre in the faculty represents a heterogeneity, both in their political preferences and value judgements, whpreferences and value judgements, which had shown various alterations ich had shown various alterations in time and changing conjuncture.in time and changing conjuncture.181 Ahmet Mithat, the author of Ahmet Mithat, the author of Ekonomi PolitikEkonomi Politik,, was claiming that every economics book is related was claiming that every economics book is related with the nationality of its author.with the nationality of its author.182 Based on the observations in this Based on the observations in this research, I would goresearch, I would go one step further and claim that each economics one step further and claim that each economics book is related with the current ideological stance of its author influ-book is related with the current ideological stance of its author influ-enced both by the nationality and a definite repertoire of discourse enced both by the nationality and a definite repertoire of discourse he/she feels him/herself allowed to remain within. But this repertoihe/she feels him/herself allowed to remain within. But this repertoire re

178 Aydın Yalçın, “Esaret Yolu,” Aydın Yalçın, “Esaret Yolu,” AÜSBFAÜSBFDD 1, no. 4 (1943): 894. Yalçın also mentions that this 1, no. 4 (1943): 894. Yalçın also mentions that this book was considered among the most important books of the generation and refers to book was considered among the most important books of the generation and refers to HarpeHarper’s quotation: “This book is a warning cry in the age of hesitation. It says us the r’s quotation: “This book is a warning cry in the age of hesitation. It says us the followings: stop, look and listen. The logic of this book is undisputedly powerful and followings: stop, look and listen. The logic of this book is undisputedly powerful and would have repercussions in masses.” Ibid., 893.would have repercussions in masses.” Ibid., 893.

179 Ibid., 894.Ibid., 894.

180 Ercan Eren, “AvustErcan Eren, “Avusturya İktisadından,” in urya İktisadından,” in Türkiye’de İktisadi Düşünce, Türkiye’de İktisadi Düşünce, 269.269.

181 As Eyüp Özveren puts it, the existence of such a nonuniformity and corporate As Eyüp Özveren puts it, the existence of such a nonuniformity and corporate flexibility can be defined as a strength. Eyüp Özveren, “Türkiye’de Üniversite ve İktisat flexibility can be defined as a strength. Eyüp Özveren, “Türkiye’de Üniversite ve İktisat Öğretimi Tartışmalarından BirÖğretimi Tartışmalarından Bir Kesit: Kesit: Kadro Kadro Dergisi Ekseninde Bir Kurumsal Yenileşme Dergisi Ekseninde Bir Kurumsal Yenileşme Örneği Olarak İktisat Fakültesi,” Örneği Olarak İktisat Fakültesi,” ODTÜ Gelişme DergisiODTÜ Gelişme Dergisi 26, no. 326, no. 3--4 (1999): 3914 (1999): 391--426.426.

182 Ziyaüddin Fahri Fındıkoğlu, Ziyaüddin Fahri Fındıkoğlu, Türkiye’de İktisat Tedrisatı Tarihçesi ve İktisat Fakültesi Türkiye’de İktisat Tedrisatı Tarihçesi ve İktisat Fakültesi Teşkilatı Teşkilatı (İstanbul: İ. Ak(İstanbul: İ. Akgün Matbaası, 1946), 25.gün Matbaası, 1946), 25.

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should not necessarily be imposed by the governing elites, it might be

should not necessarily be imposed by the governing elites, it might be determined bdetermined byy the emotional and moral patterns of the individual. And the emotional and moral patterns of the individual. And consequently, what I can see when I look at the economics education at consequently, what I can see when I look at the economics education at local, is a unique mix of the “science folocal, is a unique mix of the “science for the sake of science” and “sci-r the sake of science” and “sci-ence for the sake of ence for the sake of inkılâpinkılâp” ideas. And the word ” ideas. And the word inkılâpinkılâp as far as I am as far as I am concerned, refers to the revolutionary, progressive and developmental concerned, refers to the revolutionary, progressive and developmental steps for the nation as well as the presence of some certain intangible steps for the nation as well as the presence of some certain intangible but perceibut perceivable boundaries of the room for maneuver in determination vable boundaries of the room for maneuver in determination of the content. Even so, I think that one must of the content. Even so, I think that one must acknowledgeacknowledge the contribu-the contribu-tions of the enlightenment/modernization ideal otions of the enlightenment/modernization ideal off the Republicans and the Republicans and the reverenced position of scientific research in the wothe reverenced position of scientific research in the worldviews of the rldviews of the founding figures of the founding figures of the RRepublicepublic asas of prior importanceof prior importance. The presence of . The presence of several respectful words of various ideologically different academic several respectful words of various ideologically different academic economists for the founders of the new economists for the founders of the new RRepublic in mepublic in many of their arti-any of their arti-cles and conference texts, prcles and conference texts, proves the legitimacy of the governing elites oves the legitimacy of the governing elites in the eyes of the academics. in the eyes of the academics.

8.2

8.2 Ideological Ideological Preferences in Turkey after the WarPreferences in Turkey after the War

88..2.12.1 Teaching Economics in the “Golden Age of Capitalism”Teaching Economics in the “Golden Age of Capitalism”

Some clear appearances of the repertoire the academics remained

Some clear appearances of the repertoire the academics remained wwithin might be seen in the memoirs of Gülten Kazgan, who claimed ithin might be seen in the memoirs of Gülten Kazgan, who claimed that academic economists were expected to avoid meddling.that academic economists were expected to avoid meddling.183 In the In the first place, we know that doing politics was banned for the émigré first place, we know that doing politics was banned for the émigré economists. But Kazgan also shares her memories related wieconomists. But Kazgan also shares her memories related with the lec-th the lec-tures of the Turkish professors which validates the presence of a ten-tures of the Turkish professors which validates the presence of a ten-

183 Kazgan, Kazgan, Bir İktisatçının, Bir İktisatçının, 1717--18.18.

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dency towards an eschewal from politics for them as well. “The profes-

dency towards an eschewal from politics for them as well. “The profes-sors were generally rightist and conservative”sors were generally rightist and conservative”184 mentions Kazgan, “we mentions Kazgan, “we were taught social policy without beingwere taught social policy without being aware of the concept of woraware of the concept of workking ing class, class, as we live in an étatist peasant society.”as we live in an étatist peasant society.”185 The widely acknowl-The widely acknowl-edged economicedged economic historian “Ömer Lütfi Barkan did not exphistorian “Ömer Lütfi Barkan did not expllain the birth ain the birth of the industrial revolution and radical changes thereafter, presumably of the industrial revolution and radical changes thereafter, presumably in order notin order not to tell the ascending of the working class.”to tell the ascending of the working class.”186 ““Ziyaüddin Ziyaüddin Fahri Fındıkoğlu explainedFahri Fındıkoğlu explained thethe criticisms of Marxism in his lectures in-criticisms of Marxism in his lectures in-stead of explaining the basic philosophy of Marxism.”stead of explaining the basic philosophy of Marxism.”187 All these state-All these state-ments of Kazgan, as I ments of Kazgan, as I see it, provide more insights aboutsee it, provide more insights about the zeitgeist, the zeitgeist, than the ideological tendencies of the academics indeed. Besides, when than the ideological tendencies of the academics indeed. Besides, when we remind ourselves that her student life was in between 1946 and we remind ourselves that her student life was in between 1946 and 1950, during when Turkey was experiencing a recovery process after 1950, during when Turkey was experiencing a recovery process after the Second World War with a drift tothe Second World War with a drift towards the liberal capitalism side in wards the liberal capitalism side in the bipolar world order, the extra cautiousness of the academics be-the bipolar world order, the extra cautiousness of the academics be-comes more understandable.comes more understandable.188

Notwithstanding, it should also be mentioned that being critical of

Notwithstanding, it should also be mentioned that being critical of Marxism didn’t mean not even mentioning his name in Marxism didn’t mean not even mentioning his name in anyany writings or writings or the educational content. There were various references to Marx, espe-the educational content. There were various references to Marx, espe-cially in the writings of the Germans. The significance of this should be cially in the writings of the Germans. The significance of this should be

184 Ibid., 17.Ibid., 17.

185 Ibid., 15.Ibid., 15.

186 Ibid., 17.Ibid., 17.

187 Ibid., 18.Ibid., 18.

188 Aside from Kazgan’s evaluations on the dominant conservatism Aside from Kazgan’s evaluations on the dominant conservatism –– preferred or notpreferred or not-- among the professors, Mihri Belli’s impression about Neamong the professors, Mihri Belli’s impression about Neumark appears as a semiumark appears as a semi--exception. Mihri Belli, who would be among the theorists of “national democratic revo-exception. Mihri Belli, who would be among the theorists of “national democratic revo-lution” ideal in the 1960s, was the assistant of Neumark in the early 1940s. He evalu-lution” ideal in the 1960s, was the assistant of Neumark in the early 1940s. He evalu-ates Neumark’s stance by saying that “Neumark was not a Marxisates Neumark’s stance by saying that “Neumark was not a Marxist, but he was not t, but he was not pejorative of Marxism like some other teachers.” What Neumark aimed according to pejorative of Marxism like some other teachers.” What Neumark aimed according to Belli, was to materialize the tax equity and social justice, without exceeding the Belli, was to materialize the tax equity and social justice, without exceeding the boundaries of the current economic system. A remarkable anecdote should alboundaries of the current economic system. A remarkable anecdote should also be so be mentioned here. Belli says that Neumark named himself as a witness for defense dur-mentioned here. Belli says that Neumark named himself as a witness for defense dur-ing the judical procedure of Belli. “Mihri Belli ile Fakülte Üzerine,” in ing the judical procedure of Belli. “Mihri Belli ile Fakülte Üzerine,” in İktisat Dergisi İktisat Dergisi 481481--482 January February (2007): 55482 January February (2007): 55--56.56.

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even more highlighted when we think that there was no reference to

even more highlighted when we think that there was no reference to Marx’s name in Charles Gide’s widelMarx’s name in Charles Gide’s widely translated economics textbook for y translated economics textbook for instance.instance.189 But it should also be noted that the references to Marxism But it should also be noted that the references to Marxism at local were mostly critical or neutral which was surprisingly most evi-at local were mostly critical or neutral which was surprisingly most evi-dent in the social policy field. The authors emphasize the role of social dent in the social policy field. The authors emphasize the role of social polipolicy in eradicating the potency of social revolution cy in eradicating the potency of social revolution –– also coined as a also coined as a bloody war bloody war –– led by led by the the Marxist views. As also mentioned in the chapter Marxist views. As also mentioned in the chapter on social policy, class struggle was considered as a waste of time and on social policy, class struggle was considered as a waste of time and energy for the workers and it was argued thenergy for the workers and it was argued that the absence of doctrinal at the absence of doctrinal divergences among workers of other segments of the society and the divergences among workers of other segments of the society and the nonexistence of the idea of class struggle were all evaluated as nonexistence of the idea of class struggle were all evaluated as strengths.strengths.190 As insistently and frequently emphasized, the point was to As insistently and frequently emphasized, the point was to believe in the compliancebelieve in the compliance of interests instead of struggle. In brief, we of interests instead of struggle. In brief, we are confronted with an avoidance from being doctrinaire, an explicit are confronted with an avoidance from being doctrinaire, an explicit distance from the socialist and communist ideas. Besides, it was also distance from the socialist and communist ideas. Besides, it was also notable to discern that the American way of doing social policy seemsnotable to discern that the American way of doing social policy seems to to have dominated the conceptualizations of the conference series in Is-have dominated the conceptualizations of the conference series in Is-tanbul University began in 1948, which might be associated with the tanbul University began in 1948, which might be associated with the changing conjuncture towards Americanization since 1947. Briefly, the changing conjuncture towards Americanization since 1947. Briefly, the reflection of the spirit of the idealized viewreflection of the spirit of the idealized viewpoint of the era is reflected point of the era is reflected in the following sentence of an article of the Social Policy Conferences: in the following sentence of an article of the Social Policy Conferences: “The workers of today, have too much at stake unlike Marx’s prophecy a “The workers of today, have too much at stake unlike Marx’s prophecy a century before.”century before.”191

After all these mentions, one might have questioned if there wa

After all these mentions, one might have questioned if there was any s any presence of an ideologically leftist professor presence of an ideologically leftist professor inin the academiathe academia back thenback then. . Two names come to mind at the first hand: Sencer Divitçioğlu and Two names come to mind at the first hand: Sencer Divitçioğlu and Sadun Aren. Let alone being ideologically leftist, we can even see the Sadun Aren. Let alone being ideologically leftist, we can even see the reflections of Marxism in the lectures of Divitçioğlu in Istanbul Universi-reflections of Marxism in the lectures of Divitçioğlu in Istanbul Universi-

189 Ercan Eren, “Küreselleşme ve RegülaErcan Eren, “Küreselleşme ve Regülasyon Evreleri:19. Yüzyıldan 21. Yüzyıla… syon Evreleri:19. Yüzyıldan 21. Yüzyıla… -- Zafer Zafer Toprak,” May 5, 2023, video, https://www.youtube.com/watch?v=E8bnTO9Zrws.Toprak,” May 5, 2023, video, https://www.youtube.com/watch?v=E8bnTO9Zrws.

190 Cahit Cahit Talas, “Türk Sendikalizminin Bugünkü Durumu ve Gelişme ŞartlarıTalas, “Türk Sendikalizminin Bugünkü Durumu ve Gelişme Şartları,,” ” AÜSBFAÜSBFDD 9, 9, no.4 (no.4 (1951954): 134): 13--14.14.

191 Ekmel Zadil, “Sosyal SigoEkmel Zadil, “Sosyal Sigortaların Mahiyet ve Vazifeleri,” rtaların Mahiyet ve Vazifeleri,” İÜSSKD, İÜSSKD, no. 3 (1950):40.no. 3 (1950):40.

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ty, wherein there was also another influenti

ty, wherein there was also another influential figure like Sabri Ülgener, al figure like Sabri Ülgener, who was strongly critical of Marxism.who was strongly critical of Marxism.192 On the other hand, Sadun Aren On the other hand, Sadun Aren at Ankara University preferred not to be doctrinaire in his lectures. at Ankara University preferred not to be doctrinaire in his lectures. Tuncer Bulutay, once a student of Aren, states that Aren didn’t give lec-Tuncer Bulutay, once a student of Aren, states that Aren didn’t give lec-tures on Marxistures on Marxism in economics courses but taught Keynesian econom-m in economics courses but taught Keynesian econom-ics.ics.193 ArenAren, i, in his autobiographical book clarifies the reasons behind n his autobiographical book clarifies the reasons behind thisthis and justifies his preference by saying: “and justifies his preference by saying: “First, iFirst, it was somehow re-t was somehow re-garded as forbidden in a school like Mülkiye, raising bureaucrats.garded as forbidden in a school like Mülkiye, raising bureaucrats.” In ” In addition, he propounds his belief in the usefulness of the lectures for the addition, he propounds his belief in the usefulness of the lectures for the prospective occupational positions of the students. For him, only one prospective occupational positions of the students. For him, only one vein of economic thought would not be enough for “raising minds.”vein of economic thought would not be enough for “raising minds.”194 Another academic figure with leftist tAnother academic figure with leftist tendencies Cahit Talas, whose the-endencies Cahit Talas, whose the-sis was considered to contain overtones of communism among the stu-sis was considered to contain overtones of communism among the stu-dents at school in Switzerlanddents at school in Switzerland195, was harshly critical of “ism”s in his , was harshly critical of “ism”s in his writings targeting the local audience.writings targeting the local audience.196 And this distance from the doc-And this distance from the doc-

192 For detailed explanations of Sabri Ülgener on Marxism, see Sabri Ülgener, “Bilim For detailed explanations of Sabri Ülgener on Marxism, see Sabri Ülgener, “Bilim İdeoloji ve Marksizm,” İdeoloji ve Marksizm,” İÜİFM İÜİFM 36, no. 136, no. 1--4 (1976).4 (1976).

193 “Mülkiyeliler Birliği ve Vakfı’nın Prof. Sadun Aren’in 80. Doğ“Mülkiyeliler Birliği ve Vakfı’nın Prof. Sadun Aren’in 80. Doğum Günü Kutlama um Günü Kutlama Töreninden Konuşmalar,” Töreninden Konuşmalar,” Sadun Aren’e 80. Yaş Armağanı Sadun Aren’e 80. Yaş Armağanı (Ankara: Mülkiyeliler Birliği (Ankara: Mülkiyeliler Birliği Vakfı Yayınları 31, Aralık 2003), 25Vakfı Yayınları 31, Aralık 2003), 25--26.26.

194 Sadun Aren, Sadun Aren, Puslu Camın Arkasından Puslu Camın Arkasından (Ankara: İmge Kitabevi, 2006), 73(Ankara: İmge Kitabevi, 2006), 73--74.74.

195 “Cahit Talas ile Söyleşi “Cahit Talas ile Söyleşi –– Yaşam ÖyküYaşam Öyküsü,” interviewers: Alpaslan Işıklı and Mesut sü,” interviewers: Alpaslan Işıklı and Mesut Gülmez, in Gülmez, in Cahit Talas’a ArmağanCahit Talas’a Armağan (Ankara: Mülkiyeliler Birliği Vakfı Yayınları 9, 1990), (Ankara: Mülkiyeliler Birliği Vakfı Yayınları 9, 1990), 12. The name of Talas’ thesis in 1947 was “La Legislation du Travail Industrial en Tur-12. The name of Talas’ thesis in 1947 was “La Legislation du Travail Industrial en Tur-quie”. Ibid., 9. Talas mentions the quie”. Ibid., 9. Talas mentions the influence of his teachers on his dissertation, Anthony influence of his teachers on his dissertation, Anthony Babel and Edgar Milhaux, both of whom were socialists. Ibid., 11.Babel and Edgar Milhaux, both of whom were socialists. Ibid., 11.

196 This approach of Talas continues in the 1960s as well. Through the articles of him, This approach of Talas continues in the 1960s as well. Through the articles of him, social policy is located within the frame of capsocial policy is located within the frame of capitalistic welfare state, apart from the italistic welfare state, apart from the Marxist economics. Talas, “Plan, Kalkınma ve İktisadi Sistemler,” Marxist economics. Talas, “Plan, Kalkınma ve İktisadi Sistemler,” AÜSBFAÜSBFDD 17, no. 3 17, no. 3 (1962): 4(1962): 4--7. He also highlights the fact that economic development plans should not be 7. He also highlights the fact that economic development plans should not be monopolized by any economic system. He argues monopolized by any economic system. He argues that the social security systems in that the social security systems in the Western countries are in advance of the socialist or communists states. The radical the Western countries are in advance of the socialist or communists states. The radical leftists also take share from his criticisms. Class conflict is considered as an old fash-leftists also take share from his criticisms. Class conflict is considered as an old fash-ioned thing by him and provoking such a conioned thing by him and provoking such a conflict by relying on “ism”s is not desired. flict by relying on “ism”s is not desired. Instead, a fair distribution of opportunities is seen more coherent with the demands Instead, a fair distribution of opportunities is seen more coherent with the demands and views of the local society. Socialist movement in Turkey was even considered by and views of the local society. Socialist movement in Turkey was even considered by

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trinal debates wa

trinal debates was appreciated by another Marxist Sadun Aren as the s appreciated by another Marxist Sadun Aren as the most powerful side of the book of Talas, most powerful side of the book of Talas, İçtimai İktisat.İçtimai İktisat.197 In addition, In addition, both Talas and Aren in their articles emphasiboth Talas and Aren in their articles emphasizedzed on the necessity of on the necessity of democratic conditions in achieving economic development, instead of democratic conditions in achieving economic development, instead of orienting towards orienting towards the totalitarian alternatives.the totalitarian alternatives.198 So, it can be said that So, it can be said that the ideologicathe ideological positions of the academics might not be perfect indica-l positions of the academics might not be perfect indica-tors in evaluating to what degree tors in evaluating to what degree the leftist views became a part of the the leftist views became a part of the economics lectures at the universities. As I already mentioned in the economics lectures at the universities. As I already mentioned in the chapter on development economics, Nejat Bengül, an outstachapter on development economics, Nejat Bengül, an outstanding pro-nding pro-fessor in Ankara Universityfessor in Ankara University who was recognized by his works on the who was recognized by his works on the mechanism of economic development was mentioning that “the choice mechanism of economic development was mentioning that “the choice or a comparison between capitalism and socialism is not an ideological or a comparison between capitalism and socialism is not an ideological preference, but should be grounded on each preference, but should be grounded on each system’s possible contribu-system’s possible contribu-tions to development.”tions to development.”199 In a similar vein, the academics seem to have In a similar vein, the academics seem to have opted for the opted for the suitable parts of these theories particularly regarding the suitable parts of these theories particularly regarding the feasibility of their practical facets. At this point, it is meaningful to recall feasibility of their practical facets. At this point, it is meaningful to recall KorkuKorkut Boratav’s interrogations: “wherein lie the belieft Boratav’s interrogations: “wherein lie the belief system and the system and the world of ideologies in a social institution, to what degree and how it world of ideologies in a social institution, to what degree and how it

Talas as a would

Talas as a would--be ideology which is not inbe ideology which is not in demand by the laborers. Pragmatic demand by the laborers. Pragmatic framework of the mixed economy is more appreciated by Talas, instead of such a dog-framework of the mixed economy is more appreciated by Talas, instead of such a dog-matism. Talas, “Başbakan İsmet,” 342matism. Talas, “Başbakan İsmet,” 342--347. Notwithstanding, in an interview that took 347. Notwithstanding, in an interview that took place years after, while answering the question whetheplace years after, while answering the question whether his views have undergone a r his views have undergone a change or not, he claims that “first, I was looking for a balance in between labor and change or not, he claims that “first, I was looking for a balance in between labor and capital. However, this has changed as I began to think like ‘what balance am I looking capital. However, this has changed as I began to think like ‘what balance am I looking for; one is the oppressor, the other is the oppressedfor; one is the oppressor, the other is the oppressed. My contribution at this point . My contribution at this point should be stand align with the oppressed by defensing their rights and freedom.” “Ca-should be stand align with the oppressed by defensing their rights and freedom.” “Ca-hit Talas ile Söyleşi hit Talas ile Söyleşi –– Yaşam Öyküsü,” 31. Yaşam Öyküsü,” 31.

197 Sadun Aren, review of Sadun Aren, review of İçtimai İktisat Dersleri,İçtimai İktisat Dersleri, by Cahit Talas, 154by Cahit Talas, 154--155.155.

198 Sadun Aren and AlSadun Aren and Albert Gorvine, “İktisadi Kalkınma ve Totaliter Liberaller,” bert Gorvine, “İktisadi Kalkınma ve Totaliter Liberaller,” AÜSBFAÜSBFDD 11, 11, no. 3 (1956): 394; Cahit Talas, “Harp Sonu Anayasalarında Sosyal Haklar,” no. 3 (1956): 394; Cahit Talas, “Harp Sonu Anayasalarında Sosyal Haklar,” AÜSBFAÜSBFDD 11, 11, no. 3 (1956): 287.no. 3 (1956): 287.

199 Nejat Bengül, “İktisadi Gelişme Mekanizması Üzerine Bir Deneme,” Nejat Bengül, “İktisadi Gelişme Mekanizması Üzerine Bir Deneme,” AÜSBFAÜSBFDD 7, no. 7, no. 1 1 (1952): 130.(1952): 130.

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perseveres? Does this perseverance become a drawback for social trans-

perseveres? Does this perseverance become a drawback for social trans-formations?”formations?”200

8..2.22.2 Political Atmosphere in TurkPolitical Atmosphere in Turkey after the War: Rapid Ameri-ey after the War: Rapid Ameri-canizationcanization

Indeed, it is little wonder to

Indeed, it is little wonder to seesee such a general attitude among the such a general attitude among the academic economists, when we consider the conjuncture after the Sec-academic economists, when we consider the conjuncture after the Sec-ond World War. Due to the incompatible demands of Josef Stalin that ond World War. Due to the incompatible demands of Josef Stalin that violate theviolate the sovereignty rights of Turkey, the Treaty of Amity between sovereignty rights of Turkey, the Treaty of Amity between Turkey and the Soviets was not renewed and there occurred a break-Turkey and the Soviets was not renewed and there occurred a break-down in the relationships. An oppositional upsurge against the Soviets down in the relationships. An oppositional upsurge against the Soviets aroused in the public opinion. The governing elites were in saroused in the public opinion. The governing elites were in search for a earch for a new ally and that ally turned out to be the other super power of the Cold new ally and that ally turned out to be the other super power of the Cold War, the US, which was also aiming to expand its domain of ideological War, the US, which was also aiming to expand its domain of ideological influence via the Truman Doctrine and Marshall Aid. An antagonism influence via the Truman Doctrine and Marshall Aid. An antagonism towards communism was ascended whtowards communism was ascended which had repercussions at the pol-ich had repercussions at the pol-icy level as well. Both the Turkey Socialisicy level as well. Both the Turkey Socialist Party and Şefik Hüsnü’s Tur-t Party and Şefik Hüsnü’s Tur-key Socialist Worker and Peasant Party were closed in 1946, the year key Socialist Worker and Peasant Party were closed in 1946, the year they were legally allowed to operate in fact. The publishing house of the they were legally allowed to operate in fact. The publishing house of the leftist journal of Zekeriya and Sabiha Sertel, leftist journal of Zekeriya and Sabiha Sertel, TanTan, , was irrupted by a was irrupted by a group in 1945,group in 1945, probably for being a protagonist of recuperation of Tur-probably for being a protagonist of recuperation of Tur-key key –– Soviet relations. The leftist professors like Adnan Cemgil (father of Soviet relations. The leftist professors like Adnan Cemgil (father of Sinan Cemgil, who was a symbolic name of the Sinan Cemgil, who was a symbolic name of the 191968 student movement 68 student movement in Turkey), Pertev Naili Boratav (father of the Marxist ein Turkey), Pertev Naili Boratav (father of the Marxist economist Korkut conomist Korkut Boratav), Niyazi Berkes and Behice Boran (Boratav), Niyazi Berkes and Behice Boran (leaderleader of the Workers Party of the Workers Party of Turkey) were prosecuted in 1948of Turkey) were prosecuted in 1948, due to their ideological stances , due to their ideological stances and political views. The assassination of Sabahattin Ali, an influential and political views. The assassination of Sabahattin Ali, an influential author known by his leftist author known by his leftist tendencies, happened in the same year. tendencies, happened in the same year.

200 Korkut Boratav, Korkut Boratav, Emperyalizm, Sosyalizm ve Türkiye Emperyalizm, Sosyalizm ve Türkiye (İstanbul: Yordam Kitap, 2010), (İstanbul: Yordam Kitap, 2010), 175.175.

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The anticommunist attitude all continued during the 1950s. The

The anticommunist attitude all continued during the 1950s. The communist poet Nazım Hikmet was denaturalized in 1951. The Village communist poet Nazım Hikmet was denaturalized in 1951. The Village Institutes were shut down in 1954, by being accused of disseminating Institutes were shut down in 1954, by being accused of disseminating communist ideas. communist ideas. Accompanying the dream of being America Jr. , the Accompanying the dream of being America Jr. , the influence of Americanization made itself evident almost in every sphere influence of Americanization made itself evident almost in every sphere in the 1950s, from the policy preferences and political discourses to the in the 1950s, from the policy preferences and political discourses to the development model and trade relations. Idevelopment model and trade relations. Indeed, indeed, it is hard tot is hard to distinguish distinguish to what degree these tendencies representto what degree these tendencies representeded for keeping up with the for keeping up with the times ortimes or were thewere the results of wellresults of well--thoughtthought--of decisions, or imposed of decisions, or imposed viewpoints from outside. All in all, if we propound that being in favor of viewpoints from outside. All in all, if we propound that being in favor of the capitalist system before the the capitalist system before the Second World War years Second World War years wawas related s related with the goal of establishinwith the goal of establishingg a national economy by rapid industrializa-a national economy by rapid industrializa-tion by eliminating class conflict, the decisiveness to remain in the tion by eliminating class conflict, the decisiveness to remain in the framework of capitalism since the end of the war should be related with framework of capitalism since the end of the war should be related with the ideothe ideological positioning within the side of the liberal democratic cap-logical positioning within the side of the liberal democratic cap-italism and italism and an orientation towards Americanization, even by being an orientation towards Americanization, even by being more royalist than the king at times.more royalist than the king at times.

Up until now, the conjuncture and the ideological stances of the aca-

Up until now, the conjuncture and the ideological stances of the aca-demics were portraydemics were portrayed whiched which allall represent represent for the lack of criticisms and for the lack of criticisms and discussions that challenge capitalism till the 1960s. At this point, I argue discussions that challenge capitalism till the 1960s. At this point, I argue that the basic reasons that the basic reasons bbehind these attitudes until the Second World ehind these attitudes until the Second World War and after the warWar and after the war differ from each other. Adiffer from each other. At the polt the policy levelicy level before before the warthe war, , all the attention was oriented to establish a national economy all the attention was oriented to establish a national economy without being occupied with class conflict. Twithout being occupied with class conflict. That is to say, that is to say, the role model he role model for the country for the country was not the Soviets, but the liberal capitalist democra-was not the Soviets, but the liberal capitalist democra-cies of the Western wcies of the Western worldorld. In this line, . In this line, the the prevalent inequalities in prevalent inequalities in the the structural power relations were not really interrogated or overlooked in structural power relations were not really interrogated or overlooked in a sense, for the sake of a sense, for the sake of thethe ccreationreation of a national bourgeoisie whose of a national bourgeoisie whose gains were expected to generate prosperity gains were expected to generate prosperity forfor the whole sothe whole society. Tciety. To me, o me, tthis was considered as ahis was considered as an urgentn urgent prerequisite forprerequisite for rapidrapid development development instead of being representative of an ideological preference for the gov-instead of being representative of an ideological preference for the gov-erning elites, as the erning elites, as the whole whole attention wattention wasas oriented to oriented to generate the most generate the most practical solutions practical solutions for the refor the recovery of a war weary country. Socialismcovery of a war weary country. Socialism then,then, might have appeared as utopic might have appeared as utopic or adventurous or adventurous in the eyes of the in the eyes of the

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governing elites,

governing elites, given the given the material conditions and material conditions and social structure of social structure of the the society. society.

Nevertheless,

Nevertheless, for the period before the war, for the period before the war, I don’t think I don’t think that the that the lack of debates on socialismlack of debates on socialism or the negative premises about the collec-or the negative premises about the collec-tivist ideologiestivist ideologies in academia in academia wwereere primarily primarily influenced by the influenced by the national national development development policies of the governing elites. First and foremost, the policies of the governing elites. First and foremost, the German émigré economists wereGerman émigré economists were alreaalreadydy keeping themselves away from keeping themselves away from the the ideologiesideologies withwithin which there exists a risk in which there exists a risk of orientation to of orientation to totalitar-totalitar-ian practices.ian practices. What they frequently emphasized What they frequently emphasized as indispensable as indispensable is the is the concept of freedomconcept of freedom and this is not astonishing when we think of their and this is not astonishing when we think of their memoriesmemories fresh in minds.fresh in minds. SSo, so, substituting the capitalist systemubstituting the capitalist system –– alt-alt-hough the system hough the system hadhad to be immediately amendedto be immediately amended according to themaccording to them –– with a system in which a tyranny of state would be at the forefrontwith a system in which a tyranny of state would be at the forefront would not be an appreciated alternative for themwould not be an appreciated alternative for them. . So, insteaSo, instead of being d of being influenced by the political atmosphere of the countryinfluenced by the political atmosphere of the country and shaping their and shaping their discourses accordinglydiscourses accordingly, I think that they , I think that they intendedintended moremore to be influential to be influential on the ideological preferences of the policy makers in a conjuncture on the ideological preferences of the policy makers in a conjuncture when the socialist alternativewhen the socialist alternative was a central matter of debate was a central matter of debate inin many many countries and Turkey was implementing fivecountries and Turkey was implementing five--year development plans year development plans borrowed from the Soviets. borrowed from the Soviets. AlthoughAlthough the socialist alternative was al-the socialist alternative was al-ready precluded ready precluded by the governing elites by the governing elites andand the étatist policies the étatist policies in Tur-in Tur-key key did notdid not carry any socialist colors, thecarry any socialist colors, the presence ofpresence of vigorous high-vigorous high-lights on the deficiencies of socialism in the discourses of the émigré lights on the deficiencies of socialism in the discourses of the émigré academics in the 1930s academics in the 1930s still still refer torefer to an anxiety which brought about an anxiety which brought about endeavoursendeavours to be to be instructiveinstructive for the current and future pfor the current and future policy makersolicy makers in in a sensea sense, in preventing a probable shift towards socialism, in preventing a probable shift towards socialism. . Yet, these in-Yet, these in-structions and structions and implicit implicit recommendations recommendations were embeddedwere embedded in the in the men-men-tions on the Turkish state and governing elites in glowing terms most of tions on the Turkish state and governing elites in glowing terms most of the time, as what they found hethe time, as what they found here was the glorification of sciencere was the glorification of science asas a a pathfinderpathfinder, competency and enli, competency and enligghtenment values. All in all, htenment values. All in all, I argue that I argue that the subjective preferences of the academics seem more decisive in the subjective preferences of the academics seem more decisive in standing aloof from socialism debates, instead of the standing aloof from socialism debates, instead of the policy preferences policy preferences ofof the governing elites.the governing elites.

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On the other hand,

On the other hand, various changes took placevarious changes took place after the war. after the war. In the In the bipolar world order, dbipolar world order, discussions on socialism and related theoretical iscussions on socialism and related theoretical expansions expansions might have might have begbeguun to seem n to seem riskierriskier for the academicsfor the academics as the as the liberal capitalism securedliberal capitalism secured its position as a preferred system and the its position as a preferred system and the iideological preference of the country was much more in sightdeological preference of the country was much more in sight. . During During ththe long lasting rivalry of the two super powers and their e long lasting rivalry of the two super powers and their ideologiesideologies,, tthe he political atmosphere political atmosphere in the country in the country might have created more pressuremight have created more pressure on the academics in determining the boundaries of their discourses re-on the academics in determining the boundaries of their discourses re-garding economics education. The impacts of the external dynamics and garding economics education. The impacts of the external dynamics and their repercussions at the intheir repercussions at the internal policy preferences seems to have ternal policy preferences seems to have drawn the lines of the teaching of economics. Tdrawn the lines of the teaching of economics. The traces of this situation he traces of this situation can be clearly seen in the memoirs of Kazgan and Belli, and Aren’s men-can be clearly seen in the memoirs of Kazgan and Belli, and Aren’s men-tions on the educational boundaries of Mülkiye and dismissals of the tions on the educational boundaries of Mülkiye and dismissals of the leftist professors. leftist professors. Hence, unlike the period before the war, the external Hence, unlike the period before the war, the external dynamics which dynamics which had repercussions in shaping internal political atmos-had repercussions in shaping internal political atmos-phere played the decisive role in phere played the decisive role in determining the boundaries ofdetermining the boundaries of the dis-the dis-courses of the academics to a certain degreecourses of the academics to a certain degree, leaving the themes regard-, leaving the themes regard-ing socialism out of the educational content as far as possibing socialism out of the educational content as far as possible.le.

8.3

8.3 What Changed and What Remained in the 1960s?What Changed and What Remained in the 1960s?

8.3.1.3.1 New ConstitutionNew Constitution, New Approaches, New Approaches

The

The following decade witnessed a divergent path in many respects. following decade witnessed a divergent path in many respects. SoSo,, it is important to see what has changed and what has remained in it is important to see what has changed and what has remained in the 1960s, by emphasizingthe 1960s, by emphasizing on the determining dynamics that played the on the determining dynamics that played the key roles during this process. In understanding the reasons of the key roles during this process. In understanding the reasons of the change, the new constitution of 1961 is of prior importance as it shaped change, the new constitution of 1961 is of prior importance as it shaped the political, social and economic atmosphere of the decade, by bringinthe political, social and economic atmosphere of the decade, by bringing g about new rules in regulating the social life as well. about new rules in regulating the social life as well. It is beyond doubt It is beyond doubt

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that t

that this constitution was the most emancipatory constitution of the his constitution was the most emancipatory constitution of the RRepublicepublic, , which emphasized the individual rights and freedom, univer-which emphasized the individual rights and freedom, univer-sity autonomy and freedom of press, which asity autonomy and freedom of press, which all gave more room for the ll gave more room for the freedom of speech. freedom of speech. To me, this constitution was the most crucial dynam-To me, this constitution was the most crucial dynam-ic of theic of the prospectiveprospective change, which led to further initiatives then. change, which led to further initiatives then. In the In the economic field,economic field, the development paradigm via industrialization in the the development paradigm via industrialization in the 1930s1930s was reviwas revived byved by the State Planning Organizationthe State Planning Organization whichwhich was was founded by the advice and active role of the Dutch Economist Jan Tin-founded by the advice and active role of the Dutch Economist Jan Tin-bergen bergen –– a symbolic name for nona symbolic name for non--Soviet Planning and the first Nobel Soviet Planning and the first Nobel Laurate Economist in 1969 together with Ragnar FrischLaurate Economist in 1969 together with Ragnar Frisch.. –– The social The social ststructure of the country had also apparructure of the country had also appareently changed in the decade. Due ntly changed in the decade. Due to the increasing immigration from the rural to the urban areas to the increasing immigration from the rural to the urban areas throughout the 1950s, a more developed and politicized working class throughout the 1950s, a more developed and politicized working class became consolidated in the 1960s, which began to be mbecame consolidated in the 1960s, which began to be more influential ore influential in the political decisionin the political decision--making processes. The right to strike and col-making processes. The right to strike and col-lective bargaining were incorporated into the constitution in 1963, dur-lective bargaining were incorporated into the constitution in 1963, dur-ing when Bülent Ecevit was the Minister of Labor as the successor of ing when Bülent Ecevit was the Minister of Labor as the successor of Cahit Talas. The Workers’ ParCahit Talas. The Workers’ Party of Turkey was founded in 1961 by ty of Turkey was founded in 1961 by twelve unionists and the party got in the parliament by the 1965 elec-twelve unionists and the party got in the parliament by the 1965 elec-tions with fourteen congressmen who all made an intense opposition tions with fourteen congressmen who all made an intense opposition against the ruling party. against the ruling party. Even so, the voting rates of the party didn’t ex-Even so, the voting rates of the party didn’t ex-ceed threeceed three percent in the elections during the decade and the dream of percent in the elections during the decade and the dream of the party that was the materialization of a bottomthe party that was the materialization of a bottom--up change via demo-up change via demo-cratic elections could never be substantiated. cratic elections could never be substantiated. By the implementation of By the implementation of industrialization by industrialization by import substitution modelimport substitution model since tsince the early 1960s he early 1960s and the redistributive policies of the state for the maintenance of the and the redistributive policies of the state for the maintenance of the system, the income levels of the masses increased which might have system, the income levels of the masses increased which might have also contributed to an increasing conformity with the system. Although also contributed to an increasing conformity with the system. Although the working class had not becomthe working class had not become a shareholder of the government or e a shareholder of the government or an alternative political power, the demands of them turned out to be the an alternative political power, the demands of them turned out to be the objects of consideration in the 1960s Turkey.objects of consideration in the 1960s Turkey.

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Aside from the

Aside from the changes in the economic policieschanges in the economic policies,, the ideological at-the ideological at-mosphere also undermosphere also underwentwent a transfoa transformation. The infiltration of the US rmation. The infiltration of the US President Lyndon Johnson’s letterPresident Lyndon Johnson’s letter201 to the press increased the opposi-to the press increased the opposi-tions against tions against the US.the US. An antiAn anti--Americanism wave encompassed the uni-Americanism wave encompassed the uni-versities, influencing the student movements of 1968.versities, influencing the student movements of 1968. Indeed, the revo-Indeed, the revo-lutionary views lutionary views were not limited by the student movement. Even before were not limited by the student movement. Even before ththat, Doğan Avcıoğlu’s journal at, Doğan Avcıoğlu’s journal Yön, Yön, which began to be published in 1961 which began to be published in 1961 became very influential in the spread of the revolutionary ideas to vari-became very influential in the spread of the revolutionary ideas to vari-ous other segments of the societous other segments of the societyy. Indeed, the leftist ideas were not only . Indeed, the leftist ideas were not only apparent in such platforms. Several traapparent in such platforms. Several translations of the philosophical nslations of the philosophical materials and literature with leftist tendencies became materials and literature with leftist tendencies became widespreadwidespread in in the 1960s as well, among which there werethe 1960s as well, among which there were JohnJohn SteinbSteinbeeck’s ck’s Gazap Gazap Üzümleri (Grapes of Wrath), Bitmeyen Kavga (In Dubious Battle), Üzümleri (Grapes of Wrath), Bitmeyen Kavga (In Dubious Battle), Maksim Maksim Gorki’s Gorki’s Ana (MAna (Motherother), ), Dimitri Dimov’sDimitri Dimov’s TütünTütün (Tobacco)(Tobacco);; as well as as well as George Politzer’s George Politzer’s Felsefenin Temel İlkeleri (Elementary Principles of Phi-Felsefenin Temel İlkeleri (Elementary Principles of Phi-losophy) losophy) and Leo Huberman’s and Leo Huberman’s Sosyalizmin Alfabesi (The ABC of Social-Sosyalizmin Alfabesi (The ABC of Social-ism).ism). The works of Yaşar Kemal, Nazım Hikmet and Ahmed Arif, were The works of Yaşar Kemal, Nazım Hikmet and Ahmed Arif, were travelling from hand to hand.travelling from hand to hand.202

The material and emotional focus was

The material and emotional focus was basicbasicalally oriented to the de-ly oriented to the de-velopmental issues all through the decade. As the expected takeoff in velopmental issues all through the decade. As the expected takeoff in Turkey, which was supposed to take place in 1937 according to the de-Turkey, which was supposed to take place in 1937 according to the de-velopment economist Walt Whitman Rostow who was known for his velopment economist Walt Whitman Rostow who was known for his theory on the stages of growtheory on the stages of growth, wasth, was stillstill not materializednot materialized203, , the core the core agenda turned out to be a search for filtering out the reasons behinagenda turned out to be a search for filtering out the reasons behindd

201 This letter was written to the incumbent Prime Minister of Turkey, İsmet İnönü, as a This letter was written to the incumbent Prime Minister of Turkey, İsmet İnönü, as a reaction against the possibility of Turkey’s intervention to Cyreaction against the possibility of Turkey’s intervention to Cyprus by a military land-prus by a military land-ing due to the conflicts in between the Turks and Greeks in the island. In the letter, ing due to the conflicts in between the Turks and Greeks in the island. In the letter, Johnson was mentioning that such a landing might result in a war in between Turkey Johnson was mentioning that such a landing might result in a war in between Turkey and Greece or an intervention of the Soviets to Turkey. In suchand Greece or an intervention of the Soviets to Turkey. In such circumstances, it is circumstances, it is asserted that NATO would not provide support for Turkey and the military supplies asserted that NATO would not provide support for Turkey and the military supplies would not be available for the use of Turkey. Apart from its content, the rhetoric of the would not be available for the use of Turkey. Apart from its content, the rhetoric of the letter also drew many reactions from the public.letter also drew many reactions from the public.

202 Zafer ToprZafer Toprak (2014) Personal communication.ak (2014) Personal communication.

203 Özer Ozankaya, “Ekonomik Gelişmenin SafhalarıÖzer Ozankaya, “Ekonomik Gelişmenin Safhaları,,” ” AÜSBFAÜSBFDD 20, no. 2 (1965):20, no. 2 (1965): 29292.2.

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underdevelopment and figuring out a suitable developmental path for

underdevelopment and figuring out a suitable developmental path for Turkey by diligently revealing the prerequisites at the first placeTurkey by diligently revealing the prerequisites at the first place..

Given

Given this ideological and political atmosphere in the decade, one this ideological and political atmosphere in the decade, one might interrogate whether it is realistic to expect the academic econo-might interrogate whether it is realistic to expect the academic econo-mists to remain outside the political realms or not. Change did not only mists to remain outside the political realms or not. Change did not only appear in Turkey indeed; as Gülten Kazgan also claimappear in Turkey indeed; as Gülten Kazgan also claimed “economics in ed “economics in the 1960s was politicized in all over the world.”the 1960s was politicized in all over the world.”204 In accordance with In accordance with the changing conditions, the role of the economists in economic policy the changing conditions, the role of the economists in economic policy making processes also gained weight in the 1960s.making processes also gained weight in the 1960s.205 This fact was also This fact was also aligned with the Keynesian maligned with the Keynesian model of the ideal dutifuodel of the ideal dutifull economist, who is economist, who is expected to shoulder the responsibility of generating solutions for the expected to shoulder the responsibility of generating solutions for the current economic problems. Then, what might be ascertained as the current economic problems. Then, what might be ascertained as the prominent economic problems in Turkey for a spirited economist at prominent economic problems in Turkey for a spirited economist at those tithose times?mes?206 Most probably, the issues of underdevelopment, de-Most probably, the issues of underdevelopment, de-pendency, inequalities and unfair income distribution. Based on the pendency, inequalities and unfair income distribution. Based on the memoirs of the current economists then, the basic motivation behind memoirs of the current economists then, the basic motivation behind being an economist can be identified as an intention to solve thebeing an economist can be identified as an intention to solve the prob-prob-lems regarding these issues. And apparently, the nature of these prob-lems regarding these issues. And apparently, the nature of these prob-lems brought about the prominence of lems brought about the prominence of the the leftist viewpoints at the first leftist viewpoints at the first

204 Kazgan, Kazgan, Bir İktisatçının, Bir İktisatçının, 87.87.

205 This is most clearly seen in constitution of the State Planning Organization. In the This is most clearly seen in constitution of the State Planning Organization. In the words of Gülten Kazgwords of Gülten Kazgan, “they gathered all the wellan, “they gathered all the well--known economists together in known economists together in SPO”. Among them there were Atilla Karaosmanoğlu, Bilsay Kuruç, Nejat Bengül, SPO”. Among them there were Atilla Karaosmanoğlu, Bilsay Kuruç, Nejat Bengül, Sencer Divitçioğlu and Besim Üstünel. As for other examples to the active political life Sencer Divitçioğlu and Besim Üstünel. As for other examples to the active political life of the economists, we can saof the economists, we can say that Cahit Talas was appointed to the Minister of Labor y that Cahit Talas was appointed to the Minister of Labor during the 27during the 27thth May government. Bedii Feyzioğlu was charged in the Chamber of Depu-May government. Bedii Feyzioğlu was charged in the Chamber of Depu-ties. Sadun Aren and Mehmet Selik became the prominent members of the Workers’ ties. Sadun Aren and Mehmet Selik became the prominent members of the Workers’ Party of Turkey.Party of Turkey.

206 Asaf Savaş Akat, Asaf Savaş Akat, a professor of economics and a graduate of İstanbul University a professor of economics and a graduate of İstanbul University Faculty of Economics in the midFaculty of Economics in the mid--1960s, claimed in a video conference that “people 1960s, claimed in a video conference that “people first become leftist, then learn about Marxism. The starting point is moral or emotion-first become leftist, then learn about Marxism. The starting point is moral or emotion-al to a great extent.” Yıal to a great extent.” Yıldız Teknik Üniversitesi İktisat Bölümü, “İktisadi Düşüncede ldız Teknik Üniversitesi İktisat Bölümü, “İktisadi Düşüncede Piero Sraffa’nın Yeri,” April 11, 2019, video conference by Asaf Savaş Akat Piero Sraffa’nın Yeri,” April 11, 2019, video conference by Asaf Savaş Akat https://www.youtube.com/watch?v=UNf1Z8gQ7CQhttps://www.youtube.com/watch?v=UNf1Z8gQ7CQ

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place. It seems to me that, the influence of Keynes in subordinating the

place. It seems to me that, the influence of Keynes in subordinating the economic theory to the economic polieconomic theory to the economic policy making, might have functioned cy making, might have functioned as a catalyzeas a catalyzerr on the way of the dissemination of the leftist ideas, nour-on the way of the dissemination of the leftist ideas, nour-ishing from his emphasis on the principle of social justice. Keynes can ishing from his emphasis on the principle of social justice. Keynes can be considered at close interval with Marx within this frame.be considered at close interval with Marx within this frame.

In line with the

In line with the expansion of the room for maneuver for the leftist expansion of the room for maneuver for the leftist politics, we are more confronted with the translations of the Marxian politics, we are more confronted with the translations of the Marxian literature among the university publications, especially through the literature among the university publications, especially through the journal of Ankara University. journal of Ankara University. PParticular works of Paul Baran, Maurarticular works of Paul Baran, Maurice ice Dobb, Oskar Lange, Karl Marx and Raul Prebisch were translated in line Dobb, Oskar Lange, Karl Marx and Raul Prebisch were translated in line with the increasing weight of the development paradigm by the midwith the increasing weight of the development paradigm by the mid--1960s. Even so, neither the Marxian themes nor the precepts of the de-1960s. Even so, neither the Marxian themes nor the precepts of the de-pendency school were totally embracedpendency school were totally embraced during tduring the aforementioned pe-he aforementioned pe-riod.riod.207 The approachThe approach is most clearly seen in the words of the academic is most clearly seen in the words of the academic figure Baran Tuncer: “figure Baran Tuncer: “TThe socialist economists have illuminated many he socialist economists have illuminated many debatable aspects, but socialism as an economic theory is far away from debatable aspects, but socialism as an economic theory is far away from being properly advanced.”being properly advanced.”208

As far as I understand from the articles in the early 1960s, even in an

As far as I understand from the articles in the early 1960s, even in an atmosphere when speaking of socialism was more comfortable, what atmosphere when speaking of socialism was more comfortable, what academics most recommended for was limited by the implementation academics most recommended for was limited by the implementation of a revised version of capitalism by the influenceof a revised version of capitalism by the influence of socialism, asof socialism, as this this was considered to be a more feasible option. was considered to be a more feasible option. The basic reason to me is The basic reason to me is that that academicsacademics didn’t think of socialism as a practical alternativedidn’t think of socialism as a practical alternative for for

207 For instance, academics were not really opposed to the maintenance of trFor instance, academics were not really opposed to the maintenance of trade relations ade relations or flow of foreign capital. Even Mehmet Selik was emphasizing the importance of these or flow of foreign capital. Even Mehmet Selik was emphasizing the importance of these relations by highlighting the role of the international division of labor in lowering the relations by highlighting the role of the international division of labor in lowering the selfself--sacrifice in the less developed countries.” Mehmet Selik, “İksacrifice in the less developed countries.” Mehmet Selik, “İktisadi Gelişme, tisadi Gelişme, Sermaye İhtiyacı ve Yabancı Sermaye,” Sermaye İhtiyacı ve Yabancı Sermaye,” AÜSBFAÜSBFDD 16, no. 4 (1961): 14.16, no. 4 (1961): 14.

208 Baran Tuncer, “Sosyalist Ekonomilerde Plan,” Baran Tuncer, “Sosyalist Ekonomilerde Plan,” AÜSBFAÜSBFDD 17, no. 3 (1962): 53. Tuncer 17, no. 3 (1962): 53. Tuncer appreciates the results of the socialist implementations by claiming that the authori-appreciates the results of the socialist implementations by claiming that the authori-taritarian socialism acquired significant outcomes in line with its economic goals in Russia an socialism acquired significant outcomes in line with its economic goals in Russia and the Eastern Europe. But he also propounds that the liberal socialism models of and the Eastern Europe. But he also propounds that the liberal socialism models of Oskar Lange could not go beyond the theoretical level.Oskar Lange could not go beyond the theoretical level.

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Turkey

Turkey..209 AndAnd academicacademic economistseconomists,, instead of being a party of an ide-instead of being a party of an ide-ology,ology, seem to beseem to be moremore focused focused onon thethe concreteconcrete realities realities andand concerned concerned withwith the the urgent urgent developmental developmental problems in the country, problems in the country, at least in their at least in their lectureslectures and academic publications.and academic publications.210

8.4

8.4 Concluding RemarksConcluding Remarks

I preferred to put an end to this research by the mid

I preferred to put an end to this research by the mid--1960s, before 1960s, before ththe widespread dominance of the neoclassical synthesis at one side and e widespread dominance of the neoclassical synthesis at one side and the emergence various inclinations towards the dependency literature the emergence various inclinations towards the dependency literature on the other, as each subject represents for a literature that most people on the other, as each subject represents for a literature that most people who are interested in the history of economwho are interested in the history of economic thought would possibly ic thought would possibly be more familiar with. Even so, I would like to briefly touch upon what be more familiar with. Even so, I would like to briefly touch upon what happened from then on or what has remained from the legacy of this happened from then on or what has remained from the legacy of this blurred period elaborated in this dissertation.blurred period elaborated in this dissertation.

By the increase in the number of the univer

By the increase in the number of the universities and economists in sities and economists in the 1970s, the 1970s, IIstanbul University began to lose its weight in economics stanbul University began to lose its weight in economics education. The discipline of economics experienced a standardization education. The discipline of economics experienced a standardization and the and the content was distracted from the national concerns as time went content was distracted from the national concerns as time went by. There were also soby. There were also some interventions which influenced the atmos-me interventions which influenced the atmos-phere of the higher education. By the 1971 phere of the higher education. By the 1971 MMemorandum, the autono-emorandum, the autono-my of the universities wmy of the universities wasas declined and The Council of Higher Educa-declined and The Council of Higher Educa-tion was founded in 1981, after the 1980 military coup. The coup and tion was founded in 1981, after the 1980 military coup. The coup and

209 As previously mentioned, the sAs previously mentioned, the socialist party, namely the Workers’ Party of ocialist party, namely the Workers’ Party of Turkey had Turkey had almost 3 percent voting rates. Obviously, this low voting rates should not be consid-almost 3 percent voting rates. Obviously, this low voting rates should not be consid-ered as a frozen data only giving idea for the situation at that current times, theered as a frozen data only giving idea for the situation at that current times, the im-im-pacts of the previously implempacts of the previously implemented antiented anti--socialist policies probably had affected the socialist policies probably had affected the voting practices of the society. But more than that, the erroneous perception of regard-voting practices of the society. But more than that, the erroneous perception of regard-ing socialist ideology which equate socialism with irreligiousness was probably the ing socialist ideology which equate socialism with irreligiousness was probably the most effective reason behind most effective reason behind this apprehension.this apprehension.

210 Sencer Divitçioğlu and İdris Küçükömer might be counted as exceptions.Sencer Divitçioğlu and İdris Küçükömer might be counted as exceptions.

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the prospect

the prospective constitution of 1982ive constitution of 1982 also provided a legal ground for also provided a legal ground for the implementation of the 24 January Decisions, which represent a the implementation of the 24 January Decisions, which represent a breaking point in the economic history, by the hurriedly transition to breaking point in the economic history, by the hurriedly transition to neoliberalism in Turkey, without being confronted with a stroneoliberalism in Turkey, without being confronted with a strong opposi-ng opposi-tion.tion. The étatist tradition was abandoned from then on and tThe étatist tradition was abandoned from then on and the new he new university structure was expected to be coherent with the new ideology university structure was expected to be coherent with the new ideology covered with the new value judgments of the market. covered with the new value judgments of the market. Some of the leftist Some of the leftist academics were dismissed. By the abanacademics were dismissed. By the abandonment of the development donment of the development paradigm since the late 1970s and the 1980s, economics turned out to paradigm since the late 1970s and the 1980s, economics turned out to be a more technical discipline and the role of be a more technical discipline and the role of the the economist as a policy economist as a policy advisor in developmental issues was weakened. In addition, we witness advisor in developmental issues was weakened. In addition, we witness the “economizatithe “economization of the social” within the paradigm shift towards ne-on of the social” within the paradigm shift towards ne-oliberalism in the 1980s Turkey. Instead of rights, incentive mecha-oliberalism in the 1980s Turkey. Instead of rights, incentive mecha-nisms became the core agenda by the concerns of increasing efficien-nisms became the core agenda by the concerns of increasing efficien-ccy.y.211 Yet, we should also note that this new neoliberalism was quite Yet, we should also note that this new neoliberalism was quite different from the concept envisioned in the 1930s and 1940s world, different from the concept envisioned in the 1930s and 1940s world, parallel with the changing world conjuncture during the 1980s.parallel with the changing world conjuncture during the 1980s.212

In this reflection chapter, I tried to portray some impressions this

In this reflection chapter, I tried to portray some impressions this research engendered in my mind, particularresearch engendered in my mind, particularlly focusing oy focusing on the reasons n the reasons behind the insistent emphasis on the maintenance of the capitalist sys-behind the insistent emphasis on the maintenance of the capitalist sys-tem and tem and the the negation of the socialist alternative, both at the policy mak-negation of the socialist alternative, both at the policy mak-ing level and through the writings of the academic economists. Before ing level and through the writings of the academic economists. Before concluding this chapter, I woconcluding this chapter, I would like to concede some possible gaps in uld like to concede some possible gaps in this analysis in advance.this analysis in advance. I am totally aware of the fact that in order to I am totally aware of the fact that in order to fully comprehend the period, one has to experience a living in those fully comprehend the period, one has to experience a living in those times. So, what I said in this whole dissertation and this reflection ctimes. So, what I said in this whole dissertation and this reflection chap-hap-

211 Adaman and Madra, “Toplumsalın İktisadileşmesi,” 93. Adaman and Madra, “Toplumsalın İktisadileşmesi,” 93.

212 For instance, it is hard to see a theoretical continuity in between the 1980s neoliberal-For instance, it is hard to see a theoretical continuity in between the 1980s neoliberal-ism and the ordism and the ordoliberal views of Wilhelm Röpke. A principle difference might be seen oliberal views of Wilhelm Röpke. A principle difference might be seen in the naming of the unit of analysis. The conceptualization of homoin the naming of the unit of analysis. The conceptualization of homo--economicus of the economicus of the new neoliberalism would not be accepted by Röpke, who preferred to use the term new neoliberalism would not be accepted by Röpke, who preferred to use the term homohomo--agent instead.agent instead. He, unlike the liberals problematized the rationality of humans. He, unlike the liberals problematized the rationality of humans. Kaya and Özgür, “İki Neoliberalizm,” 48Kaya and Özgür, “İki Neoliberalizm,” 48--49.49.

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ter, needs being enriched by the contributions of the economists, who

ter, needs being enriched by the contributions of the economists, who were once the students of the academics mentioned in this study. In the were once the students of the academics mentioned in this study. In the next chapter, I will conclude the dissertation by referring to the basic next chapter, I will conclude the dissertation by referring to the basic findings in each chapter, touching upofindings in each chapter, touching upon the contributions and limita-n the contributions and limita-tions of this study.tions of this study.

379

ConclusionConclusion

his chapter will conclude this dissertation by summarizing the

his chapter will conclude this dissertation by summarizing the basic findings in relation to the goals and main questions of the basic findings in relation to the goals and main questions of the research with a brief discussion. The contribution and limresearch with a brief discussion. The contribution and limitations of the itations of the study will be mentioned next. Finally, further research opportunities study will be mentioned next. Finally, further research opportunities will be revealed.will be revealed.

This dissertation intended to explore a particular section in the evo-

This dissertation intended to explore a particular section in the evo-lution of economics discipline as it was taught in the two classical uni-lution of economics discipline as it was taught in the two classical uni-versities, versities, Istanbul University and Ankara University, based on the pub-Istanbul University and Ankara University, based on the pub-lished material of these lished material of these two two institutions. The time interval was institutions. The time interval was identifiedidentified as the 30as the 30--35 years in between the 1930s and 35 years in between the 1930s and the the 1960s, dur-1960s, dur-ing whing whenen both the world order and the science of economics haveboth the world order and the science of economics have un-un-

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dergone rapid changes. In a late capitalized country like Turkey, follow-

dergone rapid changes. In a late capitalized country like Turkey, follow-ing the footprints of the historical evolution of economic knowledge ing the footprints of the historical evolution of economic knowledge requires to concentrate on the various theoretical and sociorequires to concentrate on the various theoretical and socio--political political influences that had a formative power on influences that had a formative power on the discipline. the discipline. In case ofIn case of a na-a na-tional school of thought tional school of thought hahadd not been occurred not been occurred due to various reasonsdue to various reasons. . LLate capitalization, ongoing existence of some traditional elements in ate capitalization, ongoing existence of some traditional elements in conceptualization of economic affairs, embeddedness of governmental conceptualization of economic affairs, embeddedness of governmental policies into epolicies into economic thinking and the relative weight of the concerns conomic thinking and the relative weight of the concerns related to the urgent economic problems related to the urgent economic problems all all might have surpassed the might have surpassed the naissance of a platform for fruitful theoretical discussionsnaissance of a platform for fruitful theoretical discussions.. Under these Under these circumstances, tcircumstances, the economic thinking necessarily carrieshe economic thinking necessarily carries the traces of the traces of the theories produced in different schools of thought. However, in this the theories produced in different schools of thought. However, in this dissertation I argue that this doesn’t mean that these theories were imi-dissertation I argue that this doesn’t mean that these theories were imi-tated or implemented in teaching as they are. Instead, the presence of tated or implemented in teaching as they are. Instead, the presence of these theories provided a these theories provided a variety of options which left room for the variety of options which left room for the agents who had a subjectivity in determination of an ideal mix in ac-agents who had a subjectivity in determination of an ideal mix in ac-cordance with the inner dynamics of the local. While doing this, the im-cordance with the inner dynamics of the local. While doing this, the im-portance given to the idiosyncrasies of the country required a ground-portance given to the idiosyncrasies of the country required a ground-work work for an added value by the academics and generation of a for an added value by the academics and generation of a --partlypartly-- original story at original story at the the national level. national level.

The time interval studied in this dissertation ends up with the emer-

The time interval studied in this dissertation ends up with the emer-gence of a new mainstream by the translation of Paul Samuelson’s gence of a new mainstream by the translation of Paul Samuelson’s Eco-Eco-nomicsnomics, which re, which reflected a turning point by the consolidation of the neo-flected a turning point by the consolidation of the neo-classical synthesis, a microclassical synthesis, a micro--based macroeconomic way of analysis. From based macroeconomic way of analysis. From then on, economics has become a more mathematical discipline with a then on, economics has become a more mathematical discipline with a renewed toolbox renewed toolbox inin making economic analysis. This dissertationmaking economic analysis. This dissertation aimed aimed to reveal the dynamics of the construction process in thto reveal the dynamics of the construction process in thatat blurred era blurred era before the consolidation of this mainstream. The starting point is before the consolidation of this mainstream. The starting point is de-de-terminedtermined as the foundation of as the foundation of Istanbul UniversityIstanbul University FFaculty of aculty of EEconomicsconomics,, as the faculty played a key roleas the faculty played a key role bothboth in in the the institutionalization of eco-institutionalization of eco-nomics discipline and reflection of the current concerns regarding the nomics discipline and reflection of the current concerns regarding the discipline of economics. In this sense, this study might be located discipline of economics. In this sense, this study might be located somewhere in between the domains of the national histories of eco-somewhere in between the domains of the national histories of eco-nomic thought andnomic thought and sociology of economics based on the published ma-sociology of economics based on the published ma-

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terial regarding the

terial regarding the evolution ofevolution of economic knowledge produced in the economic knowledge produced in the two classical universities. By doing this, I intend to make a humble con-two classical universities. By doing this, I intend to make a humble con-tribution to the existing literature by presenting a detailed texttribution to the existing literature by presenting a detailed textual anal-ual anal-ysis on the formation of the core themes within the translation/local ysis on the formation of the core themes within the translation/local adaptation of the theories in economics education via the textbooks and adaptation of the theories in economics education via the textbooks and university journalsuniversity journals, as the presence of such an analysis would provide , as the presence of such an analysis would provide insights insights aboutabout the impacts of the nthe impacts of the national peculiarities andational peculiarities and some basicsome basic concerns in determining the boundaries of the economics discipline.concerns in determining the boundaries of the economics discipline.

This study first aimed to explore the dynamics and moving parts in

This study first aimed to explore the dynamics and moving parts in the conceptualization of economics through the identified time interval. the conceptualization of economics through the identified time interval. Obviously, Obviously, the discipline of economics had a wide variety of connota-the discipline of economics had a wide variety of connota-tions tions then then with respect towith respect to it hasit has today. If we zoom out a little and try to today. If we zoom out a little and try to focus on the broader findings regarding this issue, we can say that a focus on the broader findings regarding this issue, we can say that a pure economics, free from social or political influenpure economics, free from social or political influences could not really ces could not really be mentally visualized in that time. The embeddedness of social and be mentally visualized in that time. The embeddedness of social and political aspects into economics, functions as a useful apparatus in ana-political aspects into economics, functions as a useful apparatus in ana-lyzing the relations between the content of economics and the ruling lyzing the relations between the content of economics and the ruling ideology ideology in addition to in addition to ththe impacte impactss of the shifts in hegemony wherein of the shifts in hegemony wherein the dominant knowledge is producedthe dominant knowledge is produced and disseminated around theand disseminated around the world. It also world. It also provides useful insights provides useful insights for for understanding understanding both the de-both the de-sired level of state intervention in the economy and the rolesired level of state intervention in the economy and the roless of academ-of academ-ic figuric figures in policy making processes. Besides, this embeddedness was es in policy making processes. Besides, this embeddedness was also indicative of the attached meaning of studying economics, which also indicative of the attached meaning of studying economics, which was equalized with being dutiful for the national development goals of was equalized with being dutiful for the national development goals of the country. So, it was policythe country. So, it was policy--driven, as the current driven, as the current academics felt an academics felt an explicit responsibility for diagnosing and solving the economic prob-explicit responsibility for diagnosing and solving the economic prob-lemslems of the countryof the country. . SeveralSeveral academics were also given agency at state academics were also given agency at state cadres and found opportunities to take initiatives at critical points. Acadres and found opportunities to take initiatives at critical points. An-n-otherother remarkable finding aremarkable finding about the academics of that time is that, bout the academics of that time is that, alt-alt-hough they were aware of the potential rigors and retardant factors hough they were aware of the potential rigors and retardant factors stemming from the rooted habitsstemming from the rooted habits, , they had they had such such a strong faith in social a strong faith in social change and progress under the guidance of rational thinkingchange and progress under the guidance of rational thinking.. Even so, Even so, ththeir devotement shows itself through their efforts in writing textbooks, eir devotement shows itself through their efforts in writing textbooks,

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articles, conducting seminars and following the literature day to day as

articles, conducting seminars and following the literature day to day as well as their contributions at the policy level.well as their contributions at the policy level.

This fact is interrelated with the concrete ground economics w

This fact is interrelated with the concrete ground economics was es-as es-tablished ontablished on indeedindeed. In other words, economics was not made up of ab-. In other words, economics was not made up of ab-stractions; on the contrary, it was in the swim of things. Instead of the stractions; on the contrary, it was in the swim of things. Instead of the sentence patterns like “suppose that” sentence patterns like “suppose that” –– which we are very familiar which we are very familiar from from thethe recent economics booksrecent economics books –– there wethere were concrete examples from the re concrete examples from the realreal--life phenomenon with references to local institutions in the text-life phenomenon with references to local institutions in the text-books. The content produced was mostly oriented to the local audience. books. The content produced was mostly oriented to the local audience. Although this tendency might be regarded as a limitation that may ex-Although this tendency might be regarded as a limitation that may ex-plain for the lacplain for the lack of contribution to international field in the corre-k of contribution to international field in the corre-sponding period, this can also be interpreted as an intensive effort to sponding period, this can also be interpreted as an intensive effort to contribute to economic improvement of the countrycontribute to economic improvement of the country priorlypriorly in another in another perspective. This priority might have also played a key role iperspective. This priority might have also played a key role in identifica-n identifica-tion of the preferences among the repertoire of theories. As well as sig-tion of the preferences among the repertoire of theories. As well as sig-nifying clues about the adopted approaches, nifying clues about the adopted approaches, the choice of gravitating the choice of gravitating towards the local audience towards the local audience might also have an explanatory power might also have an explanatory power in in figuring out the reasons behind thefiguring out the reasons behind the neglection of some certain theories neglection of some certain theories in the course of events.in the course of events.

Although it is mentioned that the constructed discourse for econom-

Although it is mentioned that the constructed discourse for econom-ics reflects an extraction acquired by filtering out the accumulated ics reflects an extraction acquired by filtering out the accumulated knowledge and experience within the needs of the local, thiknowledge and experience within the needs of the local, this doesn’t s doesn’t mean that academics were in the world of their’s own. An indicator of mean that academics were in the world of their’s own. An indicator of openness of the academics is the presence of many articles to be pre-openness of the academics is the presence of many articles to be pre-sentedsented forfor the conferences the conferences abroadabroad, especially in the European countries. , especially in the European countries. This is also important in the senseThis is also important in the sense that the voice the local agenda was that the voice the local agenda was heard at the international level by the attendance of theheard at the international level by the attendance of these localse local academ-academ-ic agents into such conferences, which might have contributed to the ic agents into such conferences, which might have contributed to the academic recognition of the country. Besides, the interculturally en-academic recognition of the country. Besides, the interculturally en-riched vieriched viewpoints of the academics were both provided by their educa-wpoints of the academics were both provided by their educa-tional backgrounds and intellectual enthusiasms. Yet, educational pref-tional backgrounds and intellectual enthusiasms. Yet, educational pref-erences of them should not be regarded as fixed given data buterences of them should not be regarded as fixed given data but as as reflectionreflectionss of fluid flows of thought. As for of fluid flows of thought. As for the question ofthe question of what what was was changed through time regarding their educational backgrounds, changed through time regarding their educational backgrounds, one one

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would

would witness a shift in preferred locations for educational purposes witness a shift in preferred locations for educational purposes which also reflects the switches in the dominant paradigmwhich also reflects the switches in the dominant paradigmss. For in-. For in-stance, the academics during the foundationastance, the academics during the foundational years of the faculty like l years of the faculty like Ömer Celal Sarc and Muhlis EteÖmer Celal Sarc and Muhlis Ete,, were Germanywere Germany--educatededucated,, while while Ziyaüddin Fahri Fındıkoğlu, İbrahim Fazıl Pelin, Şükrü Baban, Ömer Lüt-Ziyaüddin Fahri Fındıkoğlu, İbrahim Fazıl Pelin, Şükrü Baban, Ömer Lüt-fi Barkan fi Barkan had beenhad been in France and Refii Şükrü Suvla was in Switzerland in France and Refii Şükrü Suvla was in Switzerland for educational purposes. These preferences indicate the dominant for educational purposes. These preferences indicate the dominant weight and popularity of weight and popularity of CContinental Europeontinental Europe for educational value add-for educational value add-ed before the Second World War. However, things began to change at ed before the Second World War. However, things began to change at some point and the orientation towards the Anglosome point and the orientation towards the Anglo--Saxon tradition be-Saxon tradition be-gins, especially by Osman Okyar who was sent to Cambridge. Cambridge gins, especially by Osman Okyar who was sent to Cambridge. Cambridge later hosted academics likelater hosted academics like Sadun Aren and Sencer Divitçioğlu; while Sadun Aren and Sencer Divitçioğlu; while academics like Sabri Ülgener, Gülten Kazgan were remained at America. academics like Sabri Ülgener, Gülten Kazgan were remained at America. This shift became observable by the rise of Keynesianism after the war, This shift became observable by the rise of Keynesianism after the war, probably with the concern of keeping up with the change not only at the probably with the concern of keeping up with the change not only at the theoretical field, but also in the policy measures. theoretical field, but also in the policy measures.

Speaking of the centrality of the local peculiarities, it might be ironic

Speaking of the centrality of the local peculiarities, it might be ironic to notice that during the construction process of the discipline of eco-to notice that during the construction process of the discipline of eco-nomics in which the local dynamics played the key role, thnomics in which the local dynamics played the key role, the founding e founding figures of the faculty of economics were mostly Germanfigures of the faculty of economics were mostly German émigré econo-émigré econo-mistsmists. However, when we remind ourselves that it was W. However, when we remind ourselves that it was Wilhelm Röpke ilhelm Röpke who was a leading figure in the İktisat ve İçtimaiyyat Ensitüsü who was a leading figure in the İktisat ve İçtimaiyyat Ensitüsü –– which which was the premise of the autonomous facultywas the premise of the autonomous faculty –– it was Fritz Neumark who it was Fritz Neumark who endeavored for the emancipation of economics from law and foundation endeavored for the emancipation of economics from law and foundation of the faculty, as well as makingof the faculty, as well as making a a great effort for great effort for the the publipublication ofcation of the the journal, it was Gerhard Kessler who was the pioneer figure in constitu-journal, it was Gerhard Kessler who was the pioneer figure in constitu-tion of a substantial library in the faculty; we can more clearly see the tion of a substantial library in the faculty; we can more clearly see the efforts of these émigré economists for being beneficial for the countefforts of these émigré economists for being beneficial for the country. ry. As it is suggested by Ege and Hagemann, “personalities like Neumark or As it is suggested by Ege and Hagemann, “personalities like Neumark or Kessler represented inestimable forces of innovation, creation, realiza-Kessler represented inestimable forces of innovation, creation, realiza-tion and production inside the new university, and for the intellectual tion and production inside the new university, and for the intellectual

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and social life in the country.”

and social life in the country.”1 AlthAlthough generation of a particular ough generation of a particular school of thought could not take place in Turkey, the academics both in school of thought could not take place in Turkey, the academics both in Istanbul and Ankara UniversitIstanbul and Ankara Universitiesies definitely have built up traditiondefinitely have built up traditionss re-re-flecting theflecting theirir institutional identitinstitutional identitiesies, , which which still carrstill carryy symbolic valuesymbolic valuess..

After

After recallingrecalling these general observations, now that it would be these general observations, now that it would be meaningful to present a brief discussion on the findings related with the meaningful to present a brief discussion on the findings related with the theoretical preferences of the academics through time. First, the reader theoretical preferences of the academics through time. First, the reader should be ready to confront with a lack of consisshould be ready to confront with a lack of consistency between the sec-tency between the sec-ond chapter and the following four chapters. In the chapter scrutinizing ond chapter and the following four chapters. In the chapter scrutinizing the definition, scope and method of economics; the textbooks and arti-the definition, scope and method of economics; the textbooks and arti-cles reflect a standpoint mostly within the perspective of the neoclassi-cles reflect a standpoint mostly within the perspective of the neoclassi-cal thinking. cal thinking. AlthougAlthough slightly, ah slightly, a tendency toward conceptualization of tendency toward conceptualization of economic science within the assumptions of neoclassical school comes economic science within the assumptions of neoclassical school comes forward especially regarding the definition of economics as an amoral forward especially regarding the definition of economics as an amoral science as well as the centrality of rationality assumption and emscience as well as the centrality of rationality assumption and emphasis phasis on scarcity. However, one can see there exists no apparent consensus on scarcity. However, one can see there exists no apparent consensus among the textbooks in appreciating the neoclassical way within all re-among the textbooks in appreciating the neoclassical way within all re-spects. For instance, as for the methodological issues, neoclassical de-spects. For instance, as for the methodological issues, neoclassical de-ductivism wins by a neckductivism wins by a neck, , especially byespecially by the contributions of the local the contributions of the local academics like Suvla and Baban, which shadows forth the influence of academics like Suvla and Baban, which shadows forth the influence of the historical school. As for the distributional shares of the factors of the historical school. As for the distributional shares of the factors of production, some of the authors like Neumark seems unwilling to agree production, some of the authors like Neumark seems unwilling to agree on consideron considering labor as a commodity. When we come to issues regard-ing labor as a commodity. When we come to issues regard-ing value, Röpke’s acknowledgement on the subjectivist value theory ing value, Röpke’s acknowledgement on the subjectivist value theory conflicts with Neumark’s is analytical criticisms on both the classical conflicts with Neumark’s is analytical criticisms on both the classical objectivist value theory and neoclassical subjectivist value objectivist value theory and neoclassical subjectivist value theory. Even theory. Even Röpke doesn’t seem to totally embark on the classical and neoclassical Röpke doesn’t seem to totally embark on the classical and neoclassical belief on a pure free market as a problem solver mechanism in econo-belief on a pure free market as a problem solver mechanism in econo-my; my; butbut propoundpropoundinging a social market economy instead, which requires a social market economy instead, which requires state having a regulatory initiative state having a regulatory initiative power to some extent. power to some extent.

1 Ege Ege and Hagemann, “and Hagemann, “The ModernisationThe Modernisation,,” 25.” 25.

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Another interesting dimension of Röpke’s reception of the neoclassi-

Another interesting dimension of Röpke’s reception of the neoclassi-cal theory is that he doesn’t utilize graphics or diagrams in his books cal theory is that he doesn’t utilize graphics or diagrams in his books despite all the appreciation he expressed for the representatives of despite all the appreciation he expressed for the representatives of marginalism. Indeed, the marginalism. Indeed, the dominance of verbal analysis dominance of verbal analysis is is not only pre-not only pre-sent in Röpke but also in the other authors, which might be related with sent in Röpke but also in the other authors, which might be related with their effort to adjust even the micro phenomenon to the macro level their effort to adjust even the micro phenomenon to the macro level economic concerns of the country. This might also be because it was noteconomic concerns of the country. This might also be because it was not until the Wuntil the World orld WWar ar II that the economics became II that the economics became more more technicaltechnical with with an increasing weight of the mathematical aspects for most of the coun-an increasing weight of the mathematical aspects for most of the coun-triestries, , although institutions like Cowles Foundation which aimed to re-although institutions like Cowles Foundation which aimed to re-late economic theory with mathematics and statislate economic theory with mathematics and statisticstics was already exist-was already exist-entent. However, emphasizing the need for mathematics made itself . However, emphasizing the need for mathematics made itself evident in due course at least for the discursive level along the text-evident in due course at least for the discursive level along the text-books of Turkish authors whose books were published after the Wbooks of Turkish authors whose books were published after the World orld WWar ar II.II.

The impression gained via

The impression gained via the textbooks implies that they were in the textbooks implies that they were in torn between the theories and preferred partially adopting the content torn between the theories and preferred partially adopting the content of them. There was an explicit effort for not being ideological on the one of them. There was an explicit effort for not being ideological on the one hand and the presence of a construction process very open to metahand and the presence of a construction process very open to meta--ecoeconomic concerns on the other. The theoretical splits become under-nomic concerns on the other. The theoretical splits become under-standable which might be standable which might be dependent upondependent upon the personal theoretical the personal theoretical stance of the authors or thestance of the authors or theirir concerns about the central issues regard-concerns about the central issues regard-ing economics in thing economics in thee country. A reader, after examining country. A reader, after examining the chapter on the chapter on university reform and foundation of the faculty might expect that the university reform and foundation of the faculty might expect that the second option might be even more influential than the first, recalling second option might be even more influential than the first, recalling the discourses of the discourses of KadroKadro on the eve of the reform about “doing science on the eve of the reform about “doing science for the sake of for the sake of inkılinkılââpp”. Howe”. However, we should remind ourselves that an ver, we should remind ourselves that an obvious contradiction became visible from the very beginning, between obvious contradiction became visible from the very beginning, between such ansuch an expectation and Röpke’s words arguing “any science can be na-expectation and Röpke’s words arguing “any science can be na-tional… any expectation from science to be directly beneficial for nation tional… any expectation from science to be directly beneficial for nation meanmeans misunderstands misunderstanding the ing the science.”science.”2 Based on this discourse, one Based on this discourse, one

2 WilhelmWilhelm Röpke, Röpke, Ekonomi İlminin Tekâmül TarihiEkonomi İlminin Tekâmül Tarihi (İstanbul: İstanbul Üniversitesi Hukuk (İstanbul: İstanbul Üniversitesi Hukuk FakültesiFakültesi, 1936), , 1936), 77..

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might argue that

might argue that Röpke’s threeRöpke’s three--year short stay seems to correspond a year short stay seems to correspond a wrong wrong period, as it coincides to a time during when period, as it coincides to a time during when the economic ur-the economic ur-gencies of the nation were so centralgencies of the nation were so central;; but it might also but it might also be considered as be considered as the right time when we think of the right time when we think of hishis theoretical contributions for thetheoretical contributions for the initial phases of theinitial phases of the local local construction of economic science via his co-construction of economic science via his co-herent writing style full of a variety of reference sourcesherent writing style full of a variety of reference sources and strong and strong theoretical backgroundtheoretical background..

The

The partial reign of the neoclassical thinking begins to be shattered partial reign of the neoclassical thinking begins to be shattered in the three complementary chapters that imply the core constituents of in the three complementary chapters that imply the core constituents of economics education. The absence of neoclassical approach through the economics education. The absence of neoclassical approach through the themes like public finance, social policy and dthemes like public finance, social policy and development economics is evelopment economics is probably not surprising for none of us. This absence is mostly related probably not surprising for none of us. This absence is mostly related with the characteristics of neoclassical thinking that were generally in-with the characteristics of neoclassical thinking that were generally in-compatible with the domains in which the social aspects play the key compatible with the domains in which the social aspects play the key roles. First and forroles. First and foremost, the neoclassical theory can be described as emost, the neoclassical theory can be described as the economics of “equilibrium”, which was deemed to admit defeat in the economics of “equilibrium”, which was deemed to admit defeat in generating solutions for the sociogenerating solutions for the socio--economic problems of a late capital-economic problems of a late capital-ized developing country. As the social content and historical identized developing country. As the social content and historical identity of ity of economic development economic development werewere put aside with the assumption that indi-put aside with the assumption that indi-viduals viduals wouldwould behave in similar behave in similar waywayss regardless of time and space, the regardless of time and space, the neoclassical theory represents a static natured micro analysis. Such a neoclassical theory represents a static natured micro analysis. Such a stance would not find many theoretical stance would not find many theoretical proproponentsponents in a country mostly in a country mostly engaged with engaged with urgenturgent macro developmental moves. macro developmental moves.

The theories and assumptions of the classical school also seem to

The theories and assumptions of the classical school also seem to fall into disfavor fall into disfavor regardingregarding these three themes. Indeed, although the these three themes. Indeed, although the contributions contributions of classicals of classicals were appreciatedwere appreciated, the, their theories ir theories were not were not that acknowledged that acknowledged concerningconcerning the definition, scope and method of eco-the definition, scope and method of eco-nomics. nomics. NotwithstandingNotwithstanding, the reactions became most apparent for the , the reactions became most apparent for the issues on public finance, social policy and development economics. To issues on public finance, social policy and development economics. To start with the public fistart with the public finance, almost all the approaches mentioned in nance, almost all the approaches mentioned in the textbook and journals were against the fiscal approach of classicals the textbook and journals were against the fiscal approach of classicals which was based on the annually balanced budget. Besides, considering which was based on the annually balanced budget. Besides, considering the budget only in service of the treasury was also criticized for the budget only in service of the treasury was also criticized for its in-its in-congruity with the current conditions which required conceptualization congruity with the current conditions which required conceptualization

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of the budget as an apparatus

of the budget as an apparatus whichwhich is expected to contribute for is expected to contribute for the the economic improvement by generating economic benefits. economic improvement by generating economic benefits.

As for the opportunities provided by the classical lib

As for the opportunities provided by the classical liberalism in eval-eralism in eval-uating social policy matters, probably no one would be shocked by the uating social policy matters, probably no one would be shocked by the results since there was no apprehension of a policy except from eco-results since there was no apprehension of a policy except from eco-nomic policy nomic policy according to theaccording to the liberal thinking. Contrarily, social policy liberal thinking. Contrarily, social policy intends to solve problems occuintends to solve problems occurred by the commodification of labor rred by the commodification of labor whichwhich are not possible to be solved by the mercy of market mechanism. are not possible to be solved by the mercy of market mechanism. Even the presence of a social policy chair Even the presence of a social policy chair in the faculty of economics in the faculty of economics might be conceived as a manifestation, a challenge to pure liberal ideol-might be conceived as a manifestation, a challenge to pure liberal ideol-ogy. Iogy. Indeed, this concern was not only present in Turkey, it was some-ndeed, this concern was not only present in Turkey, it was some-how compatible with the increasing interest for social issues how compatible with the increasing interest for social issues forfor binding binding upup thethe wounds of the First World War even wounds of the First World War even in in the countries the liberal the countries the liberal ideas were born. So, ideas were born. So, oneone should keep in mind thashould keep in mind that the social policy ap-t the social policy ap-proaches of the academics don’t signify a revolt against the prevalent proaches of the academics don’t signify a revolt against the prevalent capitalist system. The emphasis of the social policy writings is oriented capitalist system. The emphasis of the social policy writings is oriented to find humane ways to “live together” on a right based perspective, to find humane ways to “live together” on a right based perspective, which would eliminatwhich would eliminate social unrest and increase productivity as well e social unrest and increase productivity as well asas thethe total product. The social policy approachestotal product. The social policy approaches at local,at local, both required both required the institutionalization of the social rights, transformation of the state the institutionalization of the social rights, transformation of the state society relations and reconstruction of the consciousnessociety relations and reconstruction of the consciousness of the indi-s of the indi-viduals within the rationality principle; which means theviduals within the rationality principle; which means the academic academic economists working on this fieldeconomists working on this field were taking side with the ones who were taking side with the ones who intend to transform capitalism, instead of accepting it as it is.intend to transform capitalism, instead of accepting it as it is.

The classical and neoclassical approaches

The classical and neoclassical approaches both both seem to be consid-seem to be consid-ered dysfunctional in analyzing the developmental issues as the con-ered dysfunctional in analyzing the developmental issues as the con-cerns on welfare and economic improvement precede the concerns re-cerns on welfare and economic improvement precede the concerns re-lated with growth and GDP lated with growth and GDP locallylocally. The classical. The classicals’s’ neglect of the early neglect of the early phases of economic developmentphases of economic development was criticized; moreover, the classical was criticized; moreover, the classical approach was considered to hinder the possibility of contemplating on approach was considered to hinder the possibility of contemplating on developmental issues. The Ricardian growth theory especially became developmental issues. The Ricardian growth theory especially became the target of the criticisms due to its incongruous hypothesis with re-the target of the criticisms due to its incongruous hypothesis with re-spect tspect to what has happened in real lifeo what has happened in real life.. NNeoclassical approach was dis-eoclassical approach was dis-approved for its unverifiable assumptions and ignorance for the distri-approved for its unverifiable assumptions and ignorance for the distri-

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butional issues. In addition, it is pretty clear for almost all the writers on

butional issues. In addition, it is pretty clear for almost all the writers on development economics that the change/improvdevelopment economics that the change/improvement will not occur by ement will not occur by the inner dynamics of the system but conscious occasional interven-the inner dynamics of the system but conscious occasional interven-tions were needed. In addition, the distributional matters were also tions were needed. In addition, the distributional matters were also considered incompatible with the neoclassical understanding which considered incompatible with the neoclassical understanding which assumes the distributional sharassumes the distributional shares of the factors of production deter-es of the factors of production deter-mined within the framework of mined within the framework of the the general equilibrium logic. However, general equilibrium logic. However, the distributional issues had critical importance in the sociothe distributional issues had critical importance in the socio--economic economic development measures. Even so, we should remind ourselves that nei-development measures. Even so, we should remind ourselves that nei-ther socialther social policy nor development economics were set against the capi-policy nor development economics were set against the capi-talist system; on the contrary, they both intended to maintain its sub-talist system; on the contrary, they both intended to maintain its sub-sistence via certain policy interventions.sistence via certain policy interventions.

In search of the footprints of

In search of the footprints of the the Marxist approaches through the Marxist approaches through the texts, texts, one can cleone can clearly seearly see that they are not that popular for the issues that they are not that popular for the issues regarding definition and scope of economics. The conflict was most ap-regarding definition and scope of economics. The conflict was most ap-parent along the evaluations of the academics on profit and interest as parent along the evaluations of the academics on profit and interest as well as thewell as theirir criticisms generated against the deficiencies criticisms generated against the deficiencies of the labor of the labor theory of value. Apart from the theoretical reception, the implementa-theory of value. Apart from the theoretical reception, the implementa-tion of the system implicitly desired by Marxism, explicitly occurred as tion of the system implicitly desired by Marxism, explicitly occurred as an evaded possibility, especially through the writings of Röpke. The fre-an evaded possibility, especially through the writings of Röpke. The fre-quenquentt warnings of Röpke warnings of Röpke onon ththe negative sides of the Soviet system e negative sides of the Soviet system might be related with amight be related with an anxiety arisen byn anxiety arisen by the close relations with Sovi-the close relations with Sovi-ets during the 1930s. However, the absence of the Marxian themes is ets during the 1930s. However, the absence of the Marxian themes is not not that unexpected in the sense thatthat unexpected in the sense that the prevalent economic system in the prevalent economic system in the couthe country ntry hhas neveras never beenbeen deviated from the capitalist system. deviated from the capitalist system.

What might be more

What might be more unanticipated unanticipated is the absence of is the absence of the the MarxiMarxian an themesthemes in a domain like social policy. Contrarily, social policy as it was in a domain like social policy. Contrarily, social policy as it was conceptualized by the authors, was considered as an instrumeconceptualized by the authors, was considered as an instrument for nt for social balance and collusion by adjusting the natural laws of economics social balance and collusion by adjusting the natural laws of economics and acted as a safety valve for the maintenance of capitalism against and acted as a safety valve for the maintenance of capitalism against radical ideologies by eradicating the social revolution possibilities. Iradical ideologies by eradicating the social revolution possibilities. In n other words, iother words, it was theoreticallyt was theoretically located outside the Marxist economics located outside the Marxist economics but within the frame of capitalist welfare state. Furthermore, the social-but within the frame of capitalist welfare state. Furthermore, the social-ist movements appeared in the country were regarded as a “would be” ist movements appeared in the country were regarded as a “would be”

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fact which were not in demand by workers. Indeed, the central dissent

fact which were not in demand by workers. Indeed, the central dissent betweebetween the Marxist theory and authors’ theoretical stances was about n the Marxist theory and authors’ theoretical stances was about their viewpoints their viewpoints visvis--àà--visvis class struggle. Although acknowledging the class struggle. Although acknowledging the existence of class concept and aspiring to emanateexistence of class concept and aspiring to emanate aa class conscious-class conscious-ness, theness, the academicsacademics emphasize on the collaboration of emphasize on the collaboration of interests instead interests instead of triggering the class conflict/struggle.of triggering the class conflict/struggle.

As regards to

As regards to thethe development economics, development economics, one canone can witness a change witness a change which signifies a slight convergence which signifies a slight convergence to to neoneo--Marxist analysis, especially Marxist analysis, especially in the journal of Ankara University. Confronting with thin the journal of Ankara University. Confronting with the translate translated ma-ed ma-terial terial written by Raul Prebisch, Maurice Dobb and Paul Baran became written by Raul Prebisch, Maurice Dobb and Paul Baran became an ordinary thing. an ordinary thing. Even Even Das KapitalDas Kapital was translated in 1965 by Mehmet was translated in 1965 by Mehmet Selik in Mülkiye. The increasing weight on the concepts like national Selik in Mülkiye. The increasing weight on the concepts like national income and distributional issuesincome and distributional issues,, reflect the relative importance of reflect the relative importance of MarxistMarxist--neoneo--Marxist approaches in case of development with respect to Marxist approaches in case of development with respect to other other subbranchessubbranches in economics. Yet, the reader should be aware of the in economics. Yet, the reader should be aware of the fact that the presence of these translations doesn’t signify a total fact that the presence of these translations doesn’t signify a total acknowledgeacknowledgement of the neoment of the neo--Marxist viewpoints for analyzing the local Marxist viewpoints for analyzing the local situation of the country. And a potential reason behind the partial adop-situation of the country. And a potential reason behind the partial adop-tion of these approaches might be tendency of the neotion of these approaches might be tendency of the neo--Marxist ap-Marxist ap-proaches towards homogenizing the developing countries which proaches towards homogenizing the developing countries which wouldwould bring about an overlook of the local peculiarities. Such a method includ-bring about an overlook of the local peculiarities. Such a method includ-ing stereotype comparisons and determinist reductivism makes it im-ing stereotype comparisons and determinist reductivism makes it im-possible to analyze the social dynamics behind development or under-possible to analyze the social dynamics behind development or under-development.development.3 What is also worth to mention iWhat is also worth to mention is the lack of the themes s the lack of the themes regarding dependency school. Instead of elaborating the trade relations regarding dependency school. Instead of elaborating the trade relations within the perspective of the dependency approach, the emphasis was within the perspective of the dependency approach, the emphasis was on the presence of a mutual benefit between the countries. The major on the presence of a mutual benefit between the countries. The major reference points didn’reference points didn’t t appearappear as neoas neo--Marxists or dependency school Marxists or dependency school thinkers, but the newly emerging development economics theorists like thinkers, but the newly emerging development economics theorists like Ragnar Nurkse, Arthur Lewis and RosensteinRagnar Nurkse, Arthur Lewis and Rosenstein--Rodan, neither of whom Rodan, neither of whom exceeds the boundaries of capitalist system in their theories. As capital exceeds the boundaries of capitalist system in their theories. As capital

3 VedatVedat MilorMilor,, Devleti Geri GetirmekDevleti Geri Getirmek (İstanbul: İletişim Yayınları, 2022), (İstanbul: İletişim Yayınları, 2022), 5959--6161..

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accumulation and industrialization were presented as prerequisites for

accumulation and industrialization were presented as prerequisites for economic development, a totally inwardeconomic development, a totally inward--looking perspective was not looking perspective was not adopted even adopted even by by the closest academics tothe closest academics to thethe MarxiMarxianan approaches.approaches.

Now that the translations of the basic outstanding th

Now that the translations of the basic outstanding theoretical ap-eoretical ap-proaches by the academics regarding various aspects of economicsproaches by the academics regarding various aspects of economics were were touched upontouched upon,, it is time to recallit is time to recall thethe locallocal impactimpactss of Keynesian theorof Keynesian theoryy. . The significance of Keynesian theory first makes itself evident in evalua-The significance of Keynesian theory first makes itself evident in evalua-tion of fiscal issues. The tion of fiscal issues. The unorthodoxy of the theory which reversed unorthodoxy of the theory which reversed many assumptions of the classical theory and focused more on the mac-many assumptions of the classical theory and focused more on the mac-ro dynamics in the functioning of economics made it a center of attrac-ro dynamics in the functioning of economics made it a center of attrac-tion at local level. The economistic viewpoint of Keynes tion at local level. The economistic viewpoint of Keynes visvis--àà--visvis the the budgetbudgetary issues, his replacement of the classicalary issues, his replacement of the classicalss “annual balanced “annual balanced budget” approach with the theory of “cyclic budget”, his stress on the budget” approach with the theory of “cyclic budget”, his stress on the significance of state intervention to economy, the beneficial impacts of significance of state intervention to economy, the beneficial impacts of public debt and expenditure as well as the nonpublic debt and expenditure as well as the non--fifiscal effects of taxation scal effects of taxation were all appreciated by the academics. Although the Keynesian theory were all appreciated by the academics. Although the Keynesian theory was mostly oriented to solve the economic problems of the developed was mostly oriented to solve the economic problems of the developed world, there were a lot for the academics to be borrowed from his lega-world, there were a lot for the academics to be borrowed from his lega-cy.cy.

The impact of Keynes

The impact of Keynes on the academia especially became evident by on the academia especially became evident by the end of the Second World War, although the end of the Second World War, although he he was already recognized was already recognized by most of the academicsby most of the academics beforebefore. Yet, his theory was not able to find a . Yet, his theory was not able to find a dominant place to be taught at all points before the 1950s. This mightdominant place to be taught at all points before the 1950s. This might be both because the presence of the Germans in the faculty of econom-be both because the presence of the Germans in the faculty of econom-ics ics –– which represent for a different theoretical stance than Keyneswhich represent for a different theoretical stance than Keynes –– and the relative obscurity of his policy prescriptions among various and the relative obscurity of his policy prescriptions among various countries before the war. That is to say, Turkecountries before the war. That is to say, Turkey was not an exception at y was not an exception at this point. However, as the Anglothis point. However, as the Anglo--Saxon ecole became more prominent Saxon ecole became more prominent in the educational preferences of the academics, the teaching of eco-in the educational preferences of the academics, the teaching of eco-nomics began to be established on a more solid ground. It was the stu-nomics began to be established on a more solid ground. It was the stu-dents of the firstdents of the first--generageneration economists in the faculties, who taught tion economists in the faculties, who taught Keynesian macroeconomicsKeynesian macroeconomics therethere. .

Although

Although thethe two important figures like Sabri Ülgener and Sadun two important figures like Sabri Ülgener and Sadun Aren played the Aren played the leadingleading roles in teaching Keynesian economics, roles in teaching Keynesian economics, it is im-it is im-

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portant to note that

portant to note that even they didn’t adopteven they didn’t adopt the theory as it was. They the theory as it was. They were both aware of the incongruities between the local conditions and were both aware of the incongruities between the local conditions and the conceptual framework of the theory. In addition, Keynesianism was the conceptual framework of the theory. In addition, Keynesianism was criticized for its static character, the generality assumption of criticized for its static character, the generality assumption of The Gen-The Gen-eral Theoryeral Theory waswas questioned questioned due to the variety of thedue to the variety of the contextual mean-contextual mean-ings ings of of concepts like unemployment concepts like unemployment iin between the developed and de-n between the developed and de-veloping world. However, as it was veloping world. However, as it was arguedargued by Osman Okyarby Osman Okyar and and previously mentioned in the chapter on the Keynesian Impactpreviously mentioned in the chapter on the Keynesian Impact “the point “the point is nois not only to explain the reality; if the subject matter is to change that t only to explain the reality; if the subject matter is to change that reality, Keynesian theory would be useful.reality, Keynesian theory would be useful.””4 In this sense, obviously it In this sense, obviously it was the Keynesian viewpoint that had the strongest iwas the Keynesian viewpoint that had the strongest influencenfluence in both in both Istanbul Istanbul University University and Ankara University wand Ankara University with respect to other schools ith respect to other schools of thought. The implicit influence of Keynes might also be felt even of thought. The implicit influence of Keynes might also be felt even when discussing the role of state intervention into economywhen discussing the role of state intervention into economy,, providing providing full employment, (although this can’t be valid for a country in which full employment, (although this can’t be valid for a country in which there is a huge hthere is a huge hidden unemployment)idden unemployment),, increasing demand and redis-increasing demand and redis-tributing the total income; which all had repercussions ontributing the total income; which all had repercussions on thethe institu-institu-tionalizationtionalization processes processes of social policy measures and designation of the of social policy measures and designation of the developmental policies. developmental policies.

The main contribution of this dissertati

The main contribution of this dissertation is the presentation of a on is the presentation of a detailed examination on the central issues regarding the construction of detailed examination on the central issues regarding the construction of economics discipline starting from the early economics discipline starting from the early RRepublican era. epublican era. TThere here ex-ex-ists ists many valuable works about the university reform, foundation of the many valuable works about the university reform, foundation of the faculty of ecofaculty of economics and the related influence ofnomics and the related influence of KadroKadro and Germans in and Germans in this process, as well as the relatively rich material on the Ottoman eco-this process, as well as the relatively rich material on the Ottoman eco-nomic thought and the biographical works for the central academic fig-nomic thought and the biographical works for the central academic fig-uresures. Yet,. Yet, such an elaborate work encompassing the publicasuch an elaborate work encompassing the publications of the tions of the two two classical universitiesclassical universities in a 30 years time intervalin a 30 years time interval with the intention with the intention ooff revealrevealinging the the evolution/evolution/construction of the discipline by micro lenses construction of the discipline by micro lenses was absent. The variety of references mentioned in this dissertation was absent. The variety of references mentioned in this dissertation reveals the multicolored, reveals the multicolored, multifaceted character of the evolutionary multifaceted character of the evolutionary

4 OsmanOsman OkyarOkyar,, Neoklasik Teoriden Keynes TeorisinNeoklasik Teoriden Keynes Teorisinee, 84, 84..

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process by presenting the changing perceptions of the academics in ac-

process by presenting the changing perceptions of the academics in ac-cordance with many inner and outer dynamics. Although rich in materi-cordance with many inner and outer dynamics. Although rich in materi-al, this dissertation intends to represent a compact substance and pro-al, this dissertation intends to represent a compact substance and pro-vide avide a more clearmore clear--cut picture about the blurred era within which both cut picture about the blurred era within which both the local and metathe local and meta--economic concerns had determining powereconomic concerns had determining powerss in shap-in shap-ing the framework of the discipline. Considering the recently increased ing the framework of the discipline. Considering the recently increased enthusiasmenthusiasm for the national histories of economic thofor the national histories of economic thought, the value of ught, the value of such a work becomes more importantsuch a work becomes more important,, at least for the humble contribu-at least for the humble contribu-tion it provides in filling the gap at the local level. Presentation of a sec-tion it provides in filling the gap at the local level. Presentation of a sec-tion from the tion from the evolutionary process evolutionary process of the economic thought experience of the economic thought experience inin Turkey would hopefuTurkey would hopefully be insightful for the international audience lly be insightful for the international audience and contribute to the literatureand contribute to the literature on the national histories of economic on the national histories of economic thought as wellthought as well. .

However, there were certain limitations for a study based on textual

However, there were certain limitations for a study based on textual analysis. First, it should be mentioned that theranalysis. First, it should be mentioned that there is excessive material e is excessive material with various interpretations, which sometimes became distractive and with various interpretations, which sometimes became distractive and conflicting in constructing a coherent story. As the most suitable texts conflicting in constructing a coherent story. As the most suitable texts were selected for the inquiry, I must annotate that there might be differ-were selected for the inquiry, I must annotate that there might be differ-ent analysis or cent analysis or commentaries through the texts which might have gone ommentaries through the texts which might have gone unnoticed. Besides, as I grounded my dissertation on textual data, only a unnoticed. Besides, as I grounded my dissertation on textual data, only a certain certain part of the reality becomes visible. The same process might have part of the reality becomes visible. The same process might have been conceived differently in the eyes of the people thatbeen conceived differently in the eyes of the people that had life experi-had life experi-ence in the current period. Although texts are useful and reliable ence in the current period. Although texts are useful and reliable sources in the sense that they are prepared within a formal viewpoint sources in the sense that they are prepared within a formal viewpoint and probably controlled by other people, one should keep in mind that and probably controlled by other people, one should keep in mind that they can merely provide a represethey can merely provide a representative dimension of the reality, which ntative dimension of the reality, which results in a limited contribution for a researcher in search of the reality results in a limited contribution for a researcher in search of the reality for a certain period.for a certain period.

In addition, I consciously avoided to take the ideological stances of

In addition, I consciously avoided to take the ideological stances of the academics into account with the fear of comithe academics into account with the fear of coming under the influence ng under the influence of a manipulative effect in interpreting their textsof a manipulative effect in interpreting their texts in the thematic chap-in the thematic chap-tersters. However, this might have reduced the substantiality of analysis or . However, this might have reduced the substantiality of analysis or the fluidity of the story.the fluidity of the story. Finally, there might have occurred some chang-Finally, there might have occurred some chang-es in the way oes in the way of thinking f thinking ofof the academics, and these changes might not the academics, and these changes might not

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have been apparent at

have been apparent at the the textual level. I mean, such a change might textual level. I mean, such a change might have repercussions at the discursive level in educational field without have repercussions at the discursive level in educational field without being published in a journal or being published in a journal or a a textbook. Since it is notextbook. Since it is not possible to t possible to keep up with such changes, the scope of the arguments presented in this keep up with such changes, the scope of the arguments presented in this dissertation is limited by the framework of the selected texts. Yet, dissertation is limited by the framework of the selected texts. Yet, oneone should keep in mind that there is always much more at the level of ex-should keep in mind that there is always much more at the level of ex-perience with respect to a cperience with respect to a content squeezed into a text. ontent squeezed into a text.

While writing this dissertation in which the basic objects of analysis

While writing this dissertation in which the basic objects of analysis were the textbooks and university journal articles, what most wondered were the textbooks and university journal articles, what most wondered me was the question that to what degree these publications became me was the question that to what degree these publications became able to find audieable to find audience. I was principally intrigued by the dimensions of nce. I was principally intrigued by the dimensions of the reception of various theories produced outside the country by the the reception of various theories produced outside the country by the academics based on the textual material they produced at academic lev-academics based on the textual material they produced at academic lev-el; yet, the “reception of the reception” side remained unclearel; yet, the “reception of the reception” side remained unclear, except , except the the previously previously mentioned memories of the current students like Gülten mentioned memories of the current students like Gülten KazganKazgan, Fikret Görün, Oktay Yenal, Fikret Görün, Oktay Yenal and some panel articles and some panel articles discussing discussing the economics education at those timesthe economics education at those times. By saying “reception of recep-. By saying “reception of recep-tion”, I intend to refer to the impresstion”, I intend to refer to the impressions of the whole material on the ions of the whole material on the minds of the students as well as what has remained for them from their minds of the students as well as what has remained for them from their educational background. Although the formation of a tradition was visi-educational background. Although the formation of a tradition was visi-ble through the material examined ble through the material examined –– which reveals the elements of con-which reveals the elements of con-tinuity betwtinuity between the teachers and studentseen the teachers and students –– we could only hear the we could only hear the voices of the ones who were involved in academia. It would be meaning-voices of the ones who were involved in academia. It would be meaning-ful to research on the impressions of the students of that time from var-ful to research on the impressions of the students of that time from var-ious other professions. ious other professions.

As for some further research option

As for some further research options regarding the same time inter-s regarding the same time inter-val examined in this dissertation, it would be useful to work on alterna-val examined in this dissertation, it would be useful to work on alterna-tive journals of institutions other than universities. Revealing both the tive journals of institutions other than universities. Revealing both the harmony or the discrepancies between them and the publications of the harmony or the discrepancies between them and the publications of the academic academic field would provide new insights for reidentifying the position field would provide new insights for reidentifying the position of academy of academy visvis--àà--visvis the economic agenda of the country. Lastly, it would the economic agenda of the country. Lastly, it would also be meaningful to do a similar research with what Sabri Ülgener did also be meaningful to do a similar research with what Sabri Ülgener did in in his his quest for understanding the implicit siquest for understanding the implicit signifiers of the economic gnifiers of the economic thought in the Ottoman Empire. In other words, tracking the footprints thought in the Ottoman Empire. In other words, tracking the footprints

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of the economic thought via the local literary texts for the

of the economic thought via the local literary texts for the RRepublican epublican era would also broaden the horizons of economic thinking, as it was era would also broaden the horizons of economic thinking, as it was done in the edited bdone in the edited book ook Edebiyattaki İktisaEdebiyattaki İktisatt..5

This dissertation intended to tell the story of construction of eco-

This dissertation intended to tell the story of construction of eco-nomics in between the 1930s and nomics in between the 1930s and the the 1960s. Although the reason be-1960s. Although the reason be-hind the choice of hind the choice of the end point was the the end point was the translation of Samuelson’s translation of Samuelson’s Eco-Eco-nomicsnomics which somehow represenwhich somehow represented the eted the establishment of a stablishment of a fundamental mainstream, the following period between the 1970s and fundamental mainstream, the following period between the 1970s and the the 1980s would also provide a fruitful ground for further analysis due 1980s would also provide a fruitful ground for further analysis due to the incremental appearance of leftist sources in contrast with the to the incremental appearance of leftist sources in contrast with the American economics. American economics. A detailed examination on the do-A detailed examination on the do-mains/subbranches in which these contradictions become most visible mains/subbranches in which these contradictions become most visible would offer an adventurous story for the researcher. Apart fwould offer an adventurous story for the researcher. Apart frrom that, om that, elaborating on the evolution of economics discipline in the laterelaborating on the evolution of economics discipline in the later--founded universitiesfounded universities like Boğaziçi University and METU would generate like Boğaziçi University and METU would generate new understandings regarding the change. Scrutinizing on the contribu-new understandings regarding the change. Scrutinizing on the contribu-tions of the academics in these universities at the international field tions of the academics in these universities at the international field would also provide would also provide brilliantbrilliant insights for the acknowledgement of insights for the acknowledgement of the the local academic economists globally. Lastly, I would like to local academic economists globally. Lastly, I would like to make make mentionmention ofof some research possibilities about the contemporary economics.some research possibilities about the contemporary economics. The The recently increasing demand for pluralism around the world for alterna-recently increasing demand for pluralism around the world for alterna-tive approaches in teaching of economics tive approaches in teaching of economics is also worth elaboration. is also worth elaboration. An An examination on texamination on the crosshe cross--national studies of the International Student national studies of the International Student Initiative for Pluralist Economics in rethinking economics might be a Initiative for Pluralist Economics in rethinking economics might be a good starting point for such a research. good starting point for such a research.

Consequently, I would like to recall the wo

Consequently, I would like to recall the words of rds of John Maynard John Maynard Keynes with gratitude, which Keynes with gratitude, which indeed providedindeed provided the necessary excitement the necessary excitement for for the choice ofthe choice of studying this studying this subjectsubject: “The ideas of economists and : “The ideas of economists and political philosophers, both when they are right and when they are political philosophers, both when they are right and when they are

5 Çınla Akdere and Derya Güler Aydın, eds. Çınla Akdere and Derya Güler Aydın, eds. Edebiyattaki İktisat Edebiyattaki İktisat (İstanbul: İletişim (İstanbul: İletişim Yayınları, 2014Yayınları, 2014))

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wrong are more powerful than

wrong are more powerful than is commonly understood. Indeed, the is commonly understood. Indeed, the world is ruled by little else.”world is ruled by little else.”6

6 John Maynard Keynes, John Maynard Keynes, The General Theory of Employment, Interest and Money The General Theory of Employment, Interest and Money (Great (Great Britain: The Macmillan Press, 1973), 383.Britain: The Macmillan Press, 1973), 383.

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Eyskens,, Mark. “The Influence of the Great Depression on Economic Mark. “The Influence of the Great Depression on Economic TheoryTheory..”” İÜİFM İÜİFM 28, no. 128, no. 1--4 (1968)4 (1968): 21: 21--41.41.

Feyzioğlu

Feyzioğlu,, BediBedi. . “Muamele Vergisi Gelir Vergisinin Yerini Tutabilir mi?”“Muamele Vergisi Gelir Vergisinin Yerini Tutabilir mi?” İÜMAMK,İÜMAMK, no. 1 no. 1 ((19551955)): 41: 41--57.57.

Fındıkoğlu

Fındıkoğlu, , Ziyaüddin FahriZiyaüddin Fahri.. ““Profesör İbrahim Fazıl Pelin Üzerindeki Profesör İbrahim Fazıl Pelin Üzerindeki Fikri Tesirlere DairFikri Tesirlere Dair..” ” İÜİFMİÜİFM 11, 11, no. no. 11--22 ((19451945)): 10: 10--22.22.

. . Türkiye’de İktisat TedrisatıTürkiye’de İktisat Tedrisatı Tarihçesi ve İktisat Fakültesi TeşkilatıTarihçesi ve İktisat Fakültesi Teşkilatı. . İstanbul: İ. Akgün Matbaası, 1946.İstanbul: İ. Akgün Matbaası, 1946.

.. RReview of Kessler’s eview of Kessler’s KooperatifçilikKooperatifçilik,, İÜHFM İÜHFM 7, no. 47, no. 4 ((19411941): ): 10711071--1081.1081.

. . “Hukuk ve İçtimaiyyat Tariflerinin Karşılaştırılması“Hukuk ve İçtimaiyyat Tariflerinin Karşılaştırılması..”” İÜHFM İÜHFM 9, 9, no. 1no. 1--2 (1943)2 (1943): 274: 274--291.291.

. . “Sosyalizm ve İçtimai Siyaset.” “Sosyalizm ve İçtimai Siyaset.” İÜSSKD, İÜSSKD, no.1no.1 ((19481948): 106): 106--125.125.

.. “Türk Sosyolojisinde İki Alman Sosyologu: Prof. Kessler ve Prof. “Türk Sosyolojisinde İki Alman Sosyologu: Prof. Kessler ve Prof. RüstowRüstow..”” İÜİFMİÜİFM 23, no. 323, no. 3--4 (1963)4 (1963): 33: 33--50.50.

Galenson

Galenson,, WalterWalter.. “Az Gelişmiş Memleketle“Az Gelişmiş Memleketlerde Sendikacılıkrde Sendikacılık..”” İÜSSKDİÜSSKD, no., no. 16 (1965)16 (1965): 55: 55--68.68.

Gürsoy, Bedri. “Doç. Dr. Nejat Bengül İçin

Gürsoy, Bedri. “Doç. Dr. Nejat Bengül İçin..”” AÜSBFAÜSBFDD 17, no. 2 (1962): 1117, no. 2 (1962): 11--16.16.

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402

Hiç

Hiç,, MükerremMükerrem.. “Ricardo’nın Büyüme Teorisi ve Az Gelişmiş Mem-“Ricardo’nın Büyüme Teorisi ve Az Gelişmiş Mem-leketlerleketler..” ” İÜİFM İÜİFM 2222,, no. 2 (no. 2 (19601960):): 2525--36.36.

Isaac

Isaac,, Alfred. Alfred. “İşsizlik“İşsizlik ve İşsizlikle Mücadeleve İşsizlikle Mücadele..”” İÜSSKD İÜSSKD 0, no. 3 (1950):0, no. 3 (1950): 2121--35.35.

Işıl

Işıl,, ZühtüZühtü.. “Mali Politika İmkanlarının Gerçekleşebilme Hudutları“Mali Politika İmkanlarının Gerçekleşebilme Hudutları..”” İÜMAMK, İÜMAMK, no. 6no. 6 ((19601960):): 8383--98.98.

Jöhr,

Jöhr, Walter Adolf. “Rekabet Fikrinin Yeniden Doğması ve Nazari İktisat.” Walter Adolf. “Rekabet Fikrinin Yeniden Doğması ve Nazari İktisat.” İÜİFMİÜİFM 5, no. 15, no. 1--4 (1945):4 (1945): 33--48.48.

Karaosmanoğlu

Karaosmanoğlu,, Atilla.Atilla. “Fonksiyonel Maliye“Fonksiyonel Maliye..”” AÜSBFAÜSBFDD 10, no. 3 (1955):10, no. 3 (1955): 3939--54.54.

. . “Keynes İktisadının Bugün Kabul Edilmeyen Tarafları.”“Keynes İktisadının Bugün Kabul Edilmeyen Tarafları.” AÜSBFAÜSBFDD 13, no. 4 (1958):13, no. 4 (1958): 11--10.10.

Keynes, John Maynard.

Keynes, John Maynard. İstihdam, Faiz ve Para Genel Teorisiİstihdam, Faiz ve Para Genel Teorisi.. TTranslated ranslated by Asım by Asım BaltacıgilBaltacıgil.. İstanbul: Fakülteler Matbaası, 1959İstanbul: Fakülteler Matbaası, 1959..

Kazgan,

Kazgan, Gülten. Gülten. “Geri Kalmış Memleketlerde Kapital Birikimi ve Vergi “Geri Kalmış Memleketlerde Kapital Birikimi ve Vergi PolitikasıPolitikası..”” İÜMAMK, İÜMAMK, no. 6 (no. 6 (19601960):): 6767--82.82.

Kessler, Gerhard.

Kessler, Gerhard. İçtimaiyata Başlangıçİçtimaiyata Başlangıç.. İstanbul: İstanbul Üniversitesi, İstanbul: İstanbul Üniversitesi, 1938.1938.

. . “Kapital“Kapitalizmin Sosyal Meseleleriizmin Sosyal Meseleleri..” ” IInn ÖÖkonominin Bugünkü Mese-konominin Bugünkü Mese-lelerileleri,, 119119--131. İstanbul: İstanbul Üniversitesi Hukuk Fakültesi İkti-131. İstanbul: İstanbul Üniversitesi Hukuk Fakültesi İkti-sat ve İçtimaiyat Enstitüsü Neşriyatı, 1934.sat ve İçtimaiyat Enstitüsü Neşriyatı, 1934.

. . “Sosyal Siyaset ve Ekonomi Siyaseti.”“Sosyal Siyaset ve Ekonomi Siyaseti.” TTranslated by Sabri Ülranslated by Sabri Ülgen-gen-erer, İÜHFM, İÜHFM 3, (1937)3, (1937): 1: 1--5.5.

ECO NOMI C S FROM THE 1 9 3 0 S TO THE 1 9 6 0 S

403

. . ““Türkiye’nin İçtimai Siyaset MesTürkiye’nin İçtimai Siyaset Meselelelerine Dair Mülahazalarelerine Dair Mülahazalar..” ” TTranslated by Orhan Tuna, ranslated by Orhan Tuna, İÜİFM İÜİFM 2, (19402, (1940)): 441: 441--470.470.

. . “Türkiye’nin İçtimai Siyaset Meseleleri“Türkiye’nin İçtimai Siyaset Meseleleri..” ” TTranslated by Orhan ranslated by Orhan Tuna, Tuna, İÜİFM İÜİFM no.1 (1939)no.1 (1939): 138: 138--166.166.

. . “Kendi Hayat Yolum“Kendi Hayat Yolum..” ” İÜSSKDİÜSSKD, , no.15 (1964)no.15 (1964): 1: 1--10.10.

Kılıçbay

Kılıçbay,, Ahmet.Ahmet. “Az İnkışaf Etmiş Memleketlerin İktisadi Gelişme “Az İnkışaf Etmiş Memleketlerin İktisadi Gelişme ŞartlarıŞartları..”” İÜİFM İÜİFM 13, no. 113, no. 1--4 (1952)4 (1952): 99: 99--118.118.

. . “İktisat İlminin Gelişmesi Karşısında Maliye Politikasının Aldığı “İktisat İlminin Gelişmesi Karşısında Maliye Politikasının Aldığı İstikametİstikamet..” ” İÜMAMKİÜMAMK, no. 4 (, no. 4 (19581958)): 59: 59--64.64.

. . “Opti“Optimal İstihlak Meyli ve Seküler Gelişmemal İstihlak Meyli ve Seküler Gelişme..”” AÜSBFAÜSBFDD 13, no. 2 13, no. 2 (1958)(1958): 50: 50--70.70.

Kuru

Kuruç,ç, BilsayBilsay.. ““İİktisat Nasıl Okutulmalı?”ktisat Nasıl Okutulmalı?” Ankara Ankara ÜÜniversitesi Siyasal niversitesi Siyasal Bilgiler FakuBilgiler Fakültesi Dergisiltesi Dergisi 25, no. 3 (25, no. 3 (19701970)): 165: 165--179.179.

La Garrigue

La Garrigue,, Victor RouquetVictor Rouquet.. “İktisat Nazariyelerinin Me“İktisat Nazariyelerinin Meydana ydana Gelmesinde Tarihin RolüGelmesinde Tarihin Rolü..”” İÜİFM 12, İÜİFM 12, no: 1no: 1--2 (1950)2 (1950):: 8787--100.100.

. . “İktisadi Gelişme Teorisi ve Prensipleri“İktisadi Gelişme Teorisi ve Prensipleri..”” İÜİFM İÜİFM 27, no. 327, no. 3--4 4 ((19681968)): 183: 183--208.208.

Laufenburger

Laufenburger,, Henry. Henry. “Verginin “Verginin İİktisadi ve İçtimai Siyasetin Vasıtası ktisadi ve İçtimai Siyasetin Vasıtası Olarak KullanılmasıOlarak Kullanılması..”” TTranslated branslated by Bedi Necmettin Feyzioğluy Bedi Necmettin Feyzioğlu, , AÜHFD AÜHFD 6, no.6, no. 1 (1949)1 (1949): 225: 225--235.235.

Marchal, Jean

Marchal, Jean.. “Mali İktisadın Mahiyeti ve Muhtevası“Mali İktisadın Mahiyeti ve Muhtevası..” ” TTranslated by İs-ranslated by İs-mail Hakkı Ülkmemail Hakkı Ülkmen.n. AÜSBFAÜSBFDD 6, no. 1 (6, no. 1 (1951951): 1231): 123--137.137.

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Nalbandoğlu

Nalbandoğlu, Reşat., Reşat. ““Türk İşçisinin İktisadi İstikbaliTürk İşçisinin İktisadi İstikbali..”” İÜSSKD, İÜSSKD, no. 2 no. 2 ((19491949)): 124: 124--137.137.

. . “Ücretler ve Fiyatlar“Ücretler ve Fiyatlar..”” İÜSSKD, İÜSSKD, no. 3 (1950)no. 3 (1950): 65: 65--83.83.

Neumark,

Neumark, Fritz.Fritz. Genel Ekonomi Teorisi v.1. Genel Ekonomi Teorisi v.1. İstanbul: İ. Akgün Matbaası, İstanbul: İ. Akgün Matbaası, 1944.1944.

.. Umumi İktisat Teorisi. Umumi İktisat Teorisi. İstanbul: İstanbul Üniversitesi Yayınları, İstanbul: İstanbul Üniversitesi Yayınları, 1940.1940.

. . Maliyeye Dair TetkikMaliyeye Dair Tetkiklerler.. İstanbul: İsmail Akgün Matbaası,İstanbul: İsmail Akgün Matbaası, 19481948..

. . “Konjonktürel Bir Bütçe Açığı Karşısında Devletin Vaziyeti“Konjonktürel Bir Bütçe Açığı Karşısında Devletin Vaziyeti..” ” TTranslated by Orhan Dikmen, ranslated by Orhan Dikmen, İÜİFM, İÜİFM, no. 1 (no. 1 (19391939)): 167: 167--197.197.

. . “Maliye Siyasetinin Milli Hususiyetleri“Maliye Siyasetinin Milli Hususiyetleri..” ” Translated by Sabri Translated by Sabri Ülgener, Ülgener, İÜHFM İÜHFM 4, no.4, no. 14 (14 (19381938)): 361: 361--375.375.

. . “Vergi Yükü ve İktisadi Hayat“Vergi Yükü ve İktisadi Hayat..” ” TTranslated by Sabri Ülgener, ranslated by Sabri Ülgener, İÜHFM İÜHFM 3 (1937)3 (1937): 247: 247--261.261.

. . ““Review of Review of Maliye DersleriMaliye Dersleri by Fadıl Surby Fadıl Sur”” İÜİFMİÜİFM, (1946), (1946): 126: 126--130.130.

. . “Devri Bütçe“Devri Bütçe..” ” TTranslated by Osman Okyar, ranslated by Osman Okyar, İÜİFM İÜİFM 9, no. 19, no. 1--2 2 ((19471947)): 1: 166--29.29.

Okyar

Okyar,, OsmanOsman.. “Bir İktisadi Siyaset Peşinde“Bir İktisadi Siyaset Peşinde..” ” İÜİFM İÜİFM 8, no. 18, no. 1--4 (1946)4 (1946): : 9090--123.123.

. . Neoklasik Teoriden Keynes TeorisineNeoklasik Teoriden Keynes Teorisine. İstanbul: İstanbul Üniversi-. İstanbul: İstanbul Üniversi-tesi,tesi, 19541954..

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Opie

Opie,, RedverRedvers.s. “Amerikan Yardımı ve Kalkınma Meselesi“Amerikan Yardımı ve Kalkınma Meselesi..”” TTranslated by ranslated by Cemal MıhçıoğluCemal Mıhçıoğlu, , AÜSBFAÜSBFDD 8, no. 1 (8, no. 1 (19531953)): 85: 85--110.110.

Ozankaya

Ozankaya,, ÖzerÖzer.. “Ekonomik Gelişmenin Safhaları“Ekonomik Gelişmenin Safhaları..” ” AÜSBFAÜSBFDD 20, no. 2 20, no. 2 (1965)(1965): 233: 233--300.300.

Öner,

Öner, Oğuz. “Faktörler ve Payları: İktisatta bir Semantik Sorunu.” Oğuz. “Faktörler ve Payları: İktisatta bir Semantik Sorunu.” AÜSBFAÜSBFDD 26, no. 4 (1971)26, no. 4 (1971): 213: 213--232.232.

Pelin

Pelin,, İbrahim Fazılİbrahim Fazıl. . “Verginin Tarih“Verginin Tarihsel Evrimi ve Doğu Batı Arasında bu sel Evrimi ve Doğu Batı Arasında bu Husustaki MüvazilikHusustaki Müvazilik..” ” İÜHFMİÜHFM 11, , no. 4 (no. 4 (19351935)): 401: 401--406.406.

. . “Beynelmilel Ticaret Siyasetinin Tekamülü ve Bugünkü Himaye “Beynelmilel Ticaret Siyasetinin Tekamülü ve Bugünkü Himaye Tekniği.” In Tekniği.” In Ökonominin Bugünkü Meseleleri, Ökonominin Bugünkü Meseleleri, 4141--6363.. İstanbul: İstan-İstanbul: İstan-bul Üniversitesi Hukuk Fakültesi İbul Üniversitesi Hukuk Fakültesi İktisat ve İçtimaiyat Enstitüsü ktisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934.Neşriyatı, 1934.

. . Finans İlmi ve Finansal Finans İlmi ve Finansal KanunlarKanunlar. . İstanbulİstanbul: Bozkurt Basımevi, : Bozkurt Basımevi, 1937.1937.

Perkin

Perkin,, Rasim.Rasim. “Ekonomi İlminin Mahiyeti“Ekonomi İlminin Mahiyeti..” ” İÜİFMİÜİFM 3, no: 13, no: 1--2 (1942)2 (1942): 22: 22--58.58.

Perroux

Perroux,, François. “Genel Teorinin UmumileştirilmesiFrançois. “Genel Teorinin Umumileştirilmesi..” ” İÜİİÜİFMFM 1010,, no.no. 11--44 ((19491949)): 4: 4--75.75.

Röpke

Röpke Wilhelm. “Piyasa İktisadının Kuruluşu ve Mekanizması.” InWilhelm. “Piyasa İktisadının Kuruluşu ve Mekanizması.” In ÖÖkonominin Bugünkü Meselelerikonominin Bugünkü Meseleleri, 25, 25--40. İstanbul: İstanbul Üniversi-40. İstanbul: İstanbul Üniversi-tesi Hukuk Fakültesi İktisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934.tesi Hukuk Fakültesi İktisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934.

. . Cemiyet Cemiyet EkonomisiEkonomisi. . İstanbulİstanbul: İstanbul Üniversitesi, 1937.: İstanbul Üniversitesi, 1937.

. . Ekonomi İlminin Tekâmül Tarihi. Ekonomi İlminin Tekâmül Tarihi. İstanbul: İstanbul Üniversitesi İstanbul: İstanbul Üniversitesi Hukuk Fakültesi, 1936.Hukuk Fakültesi, 1936.

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. . ““KıymetKıymet Hükümleri Hakkında Bir Kıymet Hükmü.” Hükümleri Hakkında Bir Kıymet Hükmü.” İÜİFM İÜİFM 3, no. 3, no. 11--2 (1942)2 (1942): 3: 3--21.21.

.. ““İktisat İlmi İktisat Siyasetiİktisat İlmi İktisat Siyaseti..”” TTranslated by Bülent Cemil ranslated by Bülent Cemil İÜHFM İÜHFM 1, no.1 (1935)1, no.1 (1935): 41: 41--47.47.

Rüstow,

Rüstow, Alexander. “İktisat Sistemi ve İktisat İdeolojisi.” In Alexander. “İktisat Sistemi ve İktisat İdeolojisi.” In Ökonominin Ökonominin Bugünkü Meseleleri, Bugünkü Meseleleri, 77--24. İstanbul: İstanbul Üniversitesi Hukuk 24. İstanbul: İstanbul Üniversitesi Hukuk Fakültesi İktisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934.Fakültesi İktisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934.

. . “İktisat İlminin Esasları“İktisat İlminin Esasları..”” İÜİFM İÜİFM 2, (1940)2, (1940): 155: 155--201.201.

Sarc, Ömer Celal. “Konjonktür ve Buhranlar.” In

Sarc, Ömer Celal. “Konjonktür ve Buhranlar.” In Ökonominin Bugünkü Ökonominin Bugünkü Meseleleri,Meseleleri, 7373--91.91. İstanbul: İstanbul Üniversitesi Hukuk Fakültesi İk-İstanbul: İstanbul Üniversitesi Hukuk Fakültesi İk-tisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934.tisat ve İçtimaiyat Enstitüsü Neşriyatı, 1934.

. . “Werner“Werner SombartSombart..” ” İÜİFM İÜİFM 3, no.3, no. 11--2 (1942)2 (1942): 60: 60--63.63.

.. RReview of eview of Ekonomi Siyasasının Yeni İdeolojileriEkonomi Siyasasının Yeni İdeolojileri by Fritz Neu-by Fritz Neu-markmark. . İÜHFMİÜHFM 2, (1936)2, (1936): 166: 166--168.168.

Sayar

Sayar,, Ahmet GünerAhmet Güner.. “Dobretsberger“Dobretsberger Dosyası.Dosyası.”” İstanbul Üniversitesi İstanbul Üniversitesi Siyasal Bilgiler Fakültesi Dergisi Siyasal Bilgiler Fakültesi Dergisi 3636, , (May 2007(May 2007)): 1: 1--14.14.

Selik

Selik,, MehmetMehmet.. “Milletlerarası Sermaye Hareketlerinin Kısa Tarihçesi“Milletlerarası Sermaye Hareketlerinin Kısa Tarihçesi..”” AÜSBFAÜSBFDD 15, no. 415, no. 4 ((19601960)): 40: 40--65.65.

. . “İktisadi Gelişme, Sermaye İhtiyacı ve Yabancı Sermaye“İktisadi Gelişme, Sermaye İhtiyacı ve Yabancı Sermaye..”” AÜSBFAÜSBFDD 16, no. 4 (16, no. 4 (19611961)): 13: 13--30.30.

. . “Yabancı Sermayeyi Teşvik Kanunlar ve Tatbi“Yabancı Sermayeyi Teşvik Kanunlar ve Tatbikatıkatı..”” AÜSBFAÜSBFDD 16, 16, no. 3 (no. 3 (19611961)): 5: 5--38.38.

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Serin,

Serin, NecdetNecdet.. “Türkiye’“Türkiye’ninnin İktisadi Kalkınmaİktisadi Kalkınması sı ve Yabancı Hususi ve Yabancı Hususi SermayeSermaye..”” AÜSBFAÜSBFDD 13, no. 3 (1958)13, no. 3 (1958): 45: 45--71.71.

. . “İnsan Gücüne Yatırım ve İktisadi Kalkınma“İnsan Gücüne Yatırım ve İktisadi Kalkınma..” ” AÜSBFAÜSBFDD 17, no. 3 17, no. 3 ((19621962)): 55: 55--72.72.

Shanks

Shanks,, CarrolCarrol.. “Amme Harc“Amme Harcamaları İktisadi İstikrarı Sağlayabilir mi?amaları İktisadi İstikrarı Sağlayabilir mi?..” ” TTranslated by Reşat Aktan, ranslated by Reşat Aktan, AÜSBFAÜSBFDD 13, no. 3 (13, no. 3 (19581958)): 72: 72--81.81.

Soysal

Soysal,, MümtazMümtaz. . “Türk İktisadında Devletin Payı ve Rolü“Türk İktisadında Devletin Payı ve Rolü.”.” AÜSBFAÜSBFDD 12, 12, no. 3 (no. 3 (19571957)): 26: 26--35.35.

Suvla

Suvla,, Refii Şükrü. Refii Şükrü. Umumi İktisat Dersleri Birinci Kitap NaUmumi İktisat Dersleri Birinci Kitap Nazarî İktisatzarî İktisat.. İstanbul: İsmail Akgün Matbaası, 1949.İstanbul: İsmail Akgün Matbaası, 1949.

Talas

Talas,, CahitCahit.. Türkiye’nin Açıklamalı Sosyal Politika TarihiTürkiye’nin Açıklamalı Sosyal Politika Tarihi. . Ankara:Ankara: Bilgi Bilgi Yayınevi, 1992Yayınevi, 1992..

.. “Yeter Bir Ücret Politikasının Zarureti ve Ücretin Himayesi“Yeter Bir Ücret Politikasının Zarureti ve Ücretin Himayesi..”” AÜSBFAÜSBFDD 4, no.1 (4, no.1 (19481948)): 242: 242--255.255.

.. “Veriml“Verimliliğin Artırılmasında Psikolojik Faktörlerin Rolüiliğin Artırılmasında Psikolojik Faktörlerin Rolü..”” AÜSBFAÜSBFDD 7, no.7, no. 1 (1952)1 (1952): 45: 45--51.51.

. . “Kolektif İş Mukaveleleri Bakımından Türkiye’nin Durumu“Kolektif İş Mukaveleleri Bakımından Türkiye’nin Durumu..” ” AÜSBFAÜSBFDD 9, no. 1 (9, no. 1 (19541954)): 1: 1--10.10.

. . “Türk Sendikalizminin Bugünkü Durumu ve Gelişme Şartları”, “Türk Sendikalizminin Bugünkü Durumu ve Gelişme Şartları”, AÜSBFAÜSBFDD 9, no.9, no. 4 4 ((1951954)4): 1: 1--15.15.

..“Harp Sonu Anayasalarında Sosyal Haklar“Harp Sonu Anayasalarında Sosyal Haklar..”” AÜSBFAÜSBFDD 11, no. 3 11, no. 3 ((19561956)): 286: 286--302.302.

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. . “Sosyal Sigortalarımız Hakkında“Sosyal Sigortalarımız Hakkında BazıBazı MülahazalarMülahazalar..”” AÜSBFAÜSBFDD 11, 11, no. 2 (1956)no. 2 (1956): 1: 1--17.17.

. . “Türkiye’de Sosyal Sigortaların Gelişme Temayülleri“Türkiye’de Sosyal Sigortaların Gelişme Temayülleri..” ” AÜSBFAÜSBFDD 12, no. 212, no. 2 ((19571957)): 1: 1--13.13.

. . “Plan, “Plan, KalkınmaKalkınma ve İktisadi Sistemlerve İktisadi Sistemler..” ” AÜSBFAÜSBFDD 17, no. 3 (1962)17, no. 3 (1962): : 11--13.13.

. . “Başbakan İsmet İnönü ve Sosyal Politika“Başbakan İsmet İnönü ve Sosyal Politika..”” AÜSBFAÜSBFDD 20, no. 1 20, no. 1 (1965)(1965): 341: 341--358.358.

. . “Ücret Politikaları“Ücret Politikaları..” ” AÜSBFAÜSBFDD 2020, , no. 2no. 2 (1965)(1965): 17: 17--38.38.

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