One hundred years of development in Turkey with intangible capital

This thesis studies the role of intangible capital in the development of Tur-key during the last century. Intangible capital is the accumulation of human and institutional capi-tal. It is a new terminology in economics introduced by the World Bank for the research on sustainability to understand country-specific structural problems. The thesis argues that economic output is highly correlated with the historical accumulation of intangible factors. Moreover, stock of tangi-ble physical capital develops with the mutual interaction of intangible capi-tal, thus intangible capital is the root cause of development. The introduc-tion of the concept of "brand value of a country" corresponding to the intangible capital uses the analogy in microeconomics and opens a new understanding for the wealth of a nation. The empirical historical research in this respect highlights that with the enthusiasm of the founding fathers the brand value of Turkey grew fastest after 1930s until mid-century. Moreover, the accumulated intangible capi-tal supported the transition from rural to urban society. However, the study features that the growth of intangible capital suffered several severe set-backs every decade since 1960 and Turkey did not establish a sustainable institutional environment, nor a consistent human capital development pro-gram since mid of last century. The analysis based on the latest trend of all intangible factors, including the trend of human development and rule of law indicators, consequently the intangible capital concludes that the cur-rent development level of Turkey cannot be sustained unless the existing structure is reformed radically.