Economic Incorporation In The Ottoman Empire

Review of Economic Incorporation in the Ottoman Empire

In my essay I will review the topic of economic incorporation of the Ottoman Empire with European countries. While researching on my topic, I decided to benefit from three articles as resource. The purpose of reviewing this topic is analyzing how the Ottoman Empire became part of the capitalist world economy. In the article of The Ottoman Empire and the capitalist world written by Immanuel Wallerstein (1977) says, “At one point in time, the Ottoman Empire was outside the capitalist world-economy. At the later point in time, the Ottoman Empire was incorporated into the capitalist world-economy”(p.389).

As defined in the article, first point is how was the economy administration in the

Timar system used by Ottoman Empire until the Tanzimat Fermanı(1839). Starting from the 17th century timar system was not working efficient as it was because of develop in firearm of Europe and money. Because of declining efficiency of timar system and demand for cash, Ottoman Empire practiced iltizam system. Iltizam system had two parts. First part was mültezim, gave money to the Ottoman Empire. Second part was Ottoman Empire gave the right of taxation to people who called mültezim. Mültezim earned the right of taxation with an auction. Iltizam system had bad impact on peasants because mültezim had to make pressure on peasants. Because of pressure, this system did not work much long time. Also industrial revolution and nationality in the world reconstructed the world economy. These elements lead to decline economy of Ottoman Empire. Decline in economy lead to less centralized government. Local administrators (ayan) gain more power in their land; they had more control than central government on taxation. More power on ayans caused to corruption. It is all like domino effect. Ayans saw opportunity about forcing peasants in their land for earning more money than central government, so they took that

Non-Muslim people gain political importance because they were connectors. Also that is how non-Muslim people lowered their taxes and export taxes in the Empire. Free trade agreements between Europe and Ottoman contributed to integration to world economy. Industrial development at the Europe caused to difference of prices raw material and final products. Ottoman was raw material producer such as cotton and silk, so the Empire’s goods lost value. The Empire exported silk and cotton but imported final product from Europe of this materials with huge difference prices. In this part Ottoman Empire integrated to world economy. However it had pressure on the Empire economy. In the late nineteen century, Ottoman’s trade deficit was high. Reform cost huge to the Ottoman fiscal administration. Ottoman lends money again and again from Europe. Ottoman kuruş lost value against Europe currencies. Banking became harder in the Ottoman Empire. One of the most important problems while reforms continuing was the cost. In our course book it says, “Mahmut II realized that a modern army was not enough, and that an effective bureaucratic machine was needed to control the country and to ensure the collection of revenues”(Zürcher,