Between stumbling and fall towards insolvency : the endeavors of the Ottoman Empire in the 19th century

Abstract

This thesis, at first, intended to analyze one aspect of the 19th century Ottoman economic history, particularly the possible impact of the 1873 Panic in Vienna, which is addressed as the first global financial crisis, on Ottoman insolvency in 1875. However, research on the reasons of the insolvency revealed more complex relations and deep-rooted problems. In this thesis, firstly the reasons of financial disorder in the Ottoman Empire and road to foreign loans are explained. Later on, efforts of the Ottomans in order to overcome financial problems and their attempts for establishing banks and industrialization are analyzed. Afterwards, the reasons for the Ottomans’ tardiness to establish banks and to construct railways despite the encouraging environment in the post-Crimean War period and the impacts of this delay are discussed. Besides, emergence of Vienna as a financial center beginning from the 1860s and its repercussions on the Ottoman economy are analyzed. Moreover, reasons for extensive foreign borrowings and attempts for railway constructions which were realized by the Ottomans beginning from the second half of the 1860s are explicated. Lastly, the impacts of 1873 Panic on stunning railway investments and the Ottoman insolvency are discussed. In the whole study, the interactions among actors and the changes in their roles throughout the period are taken into account.