Search

This article maintains that after a decade as a poster-child for neoliberal growth, (1) Turkey has definitely fallen from its former impressive growth performance, (2) the cause is exactly the rupture of its foreign capital-led growth model, just as its fragility critics warned, and (3) given the state of both external and internal economic and political factors, there is very little chance of Turkey returning to its strong growth over the next several years. [ABSTRACT FROM AUTHOR]

Despite a decade of strong growth, mainstream economists and financial markets have recently escalated their discussion of Turkey's economic ‘fragility’. Contrary to their focus on ‘excessive current account deficits’, the key to understanding Turkey's condition is the foreign capital inflows that facilitate and promote these deficits, and the extent of hot money in the inflows. This paper documents this central fragility and its current explosion. It also contributes to the debate with a detailed economic and operational definition of hot money in Turkey, not present in the existing literature. [ABSTRACT FROM PUBLISHER]