The effects of changes in Turkish business system to cooperation between holding companies

This study the tests tight-system and loose-system theses suggested in relation with reflection of institutional changes in a country especially on characteristics of its business system. According to the tight-system thesis, the characteristics of business system changes in line with institutional changes whereas this is not necessarily so in loose-system thesis. In the study, these theses are tested by examining the extent of the change in cooperation between holding companies, which are important economic actors in the Turkish business system, connected with the change experienced in the economic system after 1990. In the study, first institutional changes are examined in terms of the finance system and role of the state in economy and it is determined that the institutional context in Turkey has transformed into a context in which the state mainly take a regulation and coordination role and bank loans as well as financial markets emerge as financing means. In line with this, the examination of 18 holding companies between the years 1993-2006 determines that cooperation between holding companies in establishing consortium, establishing partnership, undertaking joint venture, exchanging stock, executing merging and license agreements generally increase even though it decreases in economic crisis periods. In addition, it is also observed that secret cooperation established between holding companies by engaging in different sectors is decreasing in time. It is determined that the most significant institutional characteristics which shape these behaviors of holding companies are privatization and economic crises. Privatization directs holding companies to cooperation whereas economic crises remove them from cooperation. The results determine that the liberalization experience in Turkey has transformed holding companies into actors which both cooperate and compete with each other.