Reconfiguring State‒Business Relations in Turkey: Housing and Hydroelectric Energy Sectors in Comparative Perspective

Abstract

This article examines the transformation in Turkey’s political economy by focusing on state‒business relations in two key economic sectors: housing and energy. The housing sector experienced an unprecedented rise in state intervention, while the hydroelectricity sector witnessed large-scale privatization. Seemingly contradictory policies across these two sectors pose a puzzle: why did the Turkish government, well-known for its neoliberal orientation, bring the state into the economy as a producer in the housing sector, while privatizing the hydroelectricity sector? This article argues that the underlying pattern in Turkey’s contemporary political economy is the growth of state‒business collaboration. Ruling party elites generated new avenues for public‒private collaboration in both sectors and blurred the boundaries between the state and the market. The article traces the role of private companies in the Housing Development Administration’s (Toplu Konut İdaresi, TOKİ) construction contracts, and the role of the General Directorate of State Hydraulic Works (Devlet Su İşleri Genel Müdürlüğü, DSİ) in creating a new market in hydroelectricity production.