The comparative political economy of post 1990s bank privatization in Mexico and Turkey

This thesis studies bank privatization in Mexico and Turkey, which are two important peripheral countries. The central problem of this thesis is how and why the forms of banking institutions have changed in different phases of capitalist development and what the social impacts are in each case for development and finance. The thesis addresses two important themes within the finance and development literature. The first theme concerns convergence versus divergence and the associated benefits of bank versus market-based finance. The second theme concerns private domestic, foreign, and state ownership of banks.The thesis is organized around five interrelated arguments. At the most general level, the thesis argues that capitalist development has consolidated around a neoliberal finance-led model of accumulation since the late 1980s and 1990s. This constitutes a new form of social rule. The thesis argues in the first case study that structural shifts in bank ownership have underpinned the emergence and consolidation of a neoliberal finance-led accumulation strategy in Mexico. In the second case study, the thesis argues that structural shifts in bank ownership have not underpinned the emergence of a neoliberal finance-led accumulation strategy in Turkey . Two additional arguments are made from the perspective of banks in capitalism. First, the distinctive transitions to finance-led accumulation in Mexico and Turkey have in very similar ways worn away the historical divisions between bank and market-based finance. Second, neoliberal and financial competitive imperatives have also worn away at the historical distinctiveness of state, domestic private, and foreign bank ownership structures . In consequence, all banks must now operate as if they were private, profit seeking banks while domestic finances are at the same time subordinate to these imperatives.