Sustaining Credit-led Growth Model and Bureaucratic Autonomy: Authoritarianism and Dependent Financialisation

Why and how could sustaining growth models pose challenges to autonomy of monetary and regulatory authorities in authoritarian regimes? While the growth models approach focuses on interactions across classes and those with the government, it tends to ignore the role of the financial sector, bureaucracy, and the international politico-economic context growth models arise upon. Addressing this gap in the literature, this paper examines maintenance of credit-led growth model in Turkey, which provided the macroeconomic basis for electoral support. Relying on elite interviews along with an analysis of written sources, the paper argues that while the credit-led growth model benefitted the incumbents, fragilities of the growth model arising from dependent financialisation threatened sustaining economic growth and hurt the interests of the private sector. Managing the fragilities and sustaining the credit-led growth model forced the authoritarian regime in alliance with the private sector towards continuation of credit allocation to spur economic growth. As the financial sector was resistant, the authoritarian regime relied on monetary and regulatory authorities while imposing its will with erosion in both de jure and de facto autonomy of these authorities. As such, the paper contributes to our understanding of how and why sustaining growth models while managing fragilities dependent financialisation creates can provide the bases of erosion in bureaucratic autonomy in authoritarian regimes.