TWO PHASES OF DEINDUSTRIALIZATION POLICIES IN ISTANBUL

The city of Istanbul is the economic and cultural heart of Turkey and is one of the oldest industrial regions in the country. However, its share of the manufacturing sector in the Turkish economy has been steadily declining since the 1980s. It is possible to define two different phases of deindustrialization during the last several decades. Discouraging new manufacturing investments was the goal of the first phase. During the second phase, priority was given to financial and real estate activities, as favored alternatives to manufacturing. The aim of the paper is to trace the effects of this policy on the structure of the manufacturing sector in Istanbul over the course of deindustrialization in Istanbul. Although Istanbul is still the primary center of Turkish manufacturing, the results show that the deindustrialization policies reduced the share of Istanbul in the Turkish manufacturing sector while at the same time deteriorating its quality