Ankara-Istanbul Paradox of the Istanbul Financial Center Project

Procedia Economics and Finance, Vol. 38, p. 185–194, 2016

10 Pages Posted: 3 Nov 2016

See all articles by Ibrahim E. Sancak

Ibrahim E. Sancak

ZWIRN-Research Center/Ostfalia University of Applied Sciences

Date Written: June 14, 2016

Abstract

While Ankara is the official capital city, Istanbul is known as the city of cultural, financial and business center of Turkey and was selected for the Istanbul Financial Center Project. Since Ankara is the capital, all policies and decisions including financial laws and regulations, selection and appointment of high level officials of financial authorities have been made in this city under formal or informal meetings. However, perspectives of Ankara and Istanbul toward financial issues including dosages of financial regulations and selection criteria of high level officials are different from each other. In this respect, following questions have been raised: Does this situation have a potential factor to create instability on management and governance of financial authorities? Is this a potential weakness for the Istanbul Financial Center Project? Considering the relevant questions, this paper has been developed on the following hypothesis: “Being a capital city is a significant/major factor for a financial center.” If the hypothesis is proved to be true, then the Istanbul Financial Center Project has a low chance of success. This paper discusses a paradox which is not a phenomenon for all countries but emerges from mostly improper institutional structures and governance of financial authorities and poor “rule of law” implementations and policies. This research is based on two real world cases.

Keywords: Financial Centers, Istanbul Financial Center Project, Financial Authorities, Rule of Law

JEL Classification: G28, G38, K20

Suggested Citation

Sancak, Ibrahim E., Ankara-Istanbul Paradox of the Istanbul Financial Center Project (June 14, 2016). Procedia Economics and Finance, Vol. 38, p. 185–194, 2016, Available at SSRN: https://ssrn.com/abstract=2863312

Ibrahim E. Sancak (Contact Author)

ZWIRN-Research Center/Ostfalia University of Applied Sciences ( email )

Germany

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