The Nature of Lobbying and Regulation in Turkey

Abstract

The policy-making and distributive effects of lobbying is a disturbing and highly debated issue in many developing countries. This study will provide a comparative analysis of the two biggest industrial-commercial interest groups in Turkey. The relationship between the policy suggestions of TUSIAD (Turkish Industry and Businessmen Association), and MUSIAD (Independent Industrialists and Businessmen’s Association) and economic policies implemented both at micro and macro level afterthe 1990’s has been placed under great scrutiny. In this paper, an overview of the positive theory of regulation along with the theory of collective action is provided in order to highlight the main discussions covered in existing literature. This paper claims that these two interest groups have conflicting incentives in terms of the regulatory process, arising from the characteristics of their members. Such a situation leads to a struggle to exert influence on governmental policies from which one group benefits, while the other is hurt. The model, adapted from Becker (1983) and partly Olson (1982) and later modified is an attempt to arrive at the optimum level of regulation which favors policies beneficial for each party. A general theory of lobbying and interest-groups in developing countries and specifically Turkey will therefore constitute the theoretical underpinning of this work while the absence of in-depth numeral indicators for the interest groups’ lobbying power dictates that descriptive statistics play an important role. This study will aim at searching out the exact cost and benefit for the groups involved as well as additional hidden factors that might incorporate explanatory power in understanding the relevant dynamics in the case of Turkey