Seven Ar, 2012

Preliminary draft, do not quote

Gedik as transferrable partnership in asset ownership: legal and

organizational change in Ottoman urban businesses, 1789-18381
Seven Ar, Yale University, March 2012
[T]he problem of defining ownership is precisely that of creating properly scaled
legal barriers to entry.2

Nikola, a Christian resident of Istanbul in the grocery business, owns 60

shares of total 120 shares of certain capital goods, known as gedik among
urban businessmen, placed within a grocery store in Balat. Hereby, the court
registers that Nikola sells 30 shares out of his 60 shares to Lazari for 1,500
guru.3
Vasil, a Christian member of the silk-spinners guild, owns a silk-spinning
loom, known as gedik, in Fazl Pasha Palace. He sells his loom to Abdi Aa, a
qualified Muslim journeyman in the guild, for 400 guru.4

In Istanbuls court registers from early nineteenth century, one can find hundreds
of similar transactions. People buy, sell, inherit, and pawn something called gedik, a
term vaguely defined in the contemporary documents as certain capital goods
(alat-i lazma-i maluma). The meaning of the term, however, is much more
complicated than it first appears. It refers to a multitude of transferable usufruct
rights in relation to both the real estate and the sector for which a particular gedik is
assigned. The ownership of gedik (sometimes without any real, tangible equipment
being present in the shop) seems to imply the right to practice a craft or a trade at a
specific location and, in this sense, it relates to the tenancy-rights of the gedik
I would like to thank Economic History Program at Yale for funding the research on which this article is based. I
am also grateful to Timothy Guinnane, Naomi Lameroux, and Onur Yldrm for extremely useful discussions about
the complex nature of gedik.
1

Demsetz (1981: 7).

M 120, 1-120/13b-1, 27 04 1232 [16 03 1817].

M 122, 1-122/21b-1, 22 03 1233 [30 01 1818].

Seven Ar, 2012

Preliminary draft, do not quote

owner. Sometimes, however, gedik refers directly to the capital goods essential for a
particular branch of production (i.e., standard textile looms). In this case, the term
relates to the privileges associated with mastership in a particular sector. In both
cases, for various reasons I will explain below, gedik ownership implies potential
barriers to entry and opportunity for speculative investment.
In this paper, I explain how this curious legal concept emerged and became one of
the most important tools of investment and credit among urban dwellers in
nineteenth-century Istanbul. To do that, I first discuss the ambiguities in the
secondary literature and reassess the arguments concerning the reasons underlying
the rise of gedik, through a time- and sector-sensitive analysis of judicial documents
concerning gedik registrations and transactions. I, then, examine how institutional
regulations concerning access to the rights associated with gedik ownership were
defined. In order to explain how secondary markets in gediks functioned; I also
present a simple theoretical framework. I argue that the increasing value of gediks
(due to long or even perpetual leases locked in rents lower than current market
rates and/or due to increasing monopoly rents associated with guilds) led to the
frequent practice of share partitioning (especially in some sectors), enabling
investment without being a member of the guild.
Ambiguities in the Secondary Literature: What is gedik and where does it
come from?
In the secondary literature on eighteenth-century urban economy, emergence and
expansion of gedik registration has been regarded as a process consolidating (or at
least aiming to consolidate) the monopolistic practices associated with the
Ottoman guilds.5 At the same time, however, the notion was linked to the
struggles revolving around shopkeepers claims to real estate (against property
owners; mostly religious endowments) and masters claims to capital inputs (against
journeymen in the guild).6 In the literature, these various functions of gediks have
been conflated, with little discussion as to whether there is a coherent content to
the term at any point in time. Neither there has been any systematic effort to test
the validity of alternative explanations for the emergence and proliferation of gedik
certificates. Although some scholars underlined the interpretative problems about

Baer 1970c. Enver Ziya Karal, Osmanl Tarihi, c. VI, TTK Yaynlar, Ankara, 1976, s. 276, Yi (2004: 151).

Akarl (1986, 2004), Faroqhi (1998).

Seven Ar, 2012

Preliminary draft, do not quote

the nebulous concept of gedik,7 we still lack a conceptual framework that would
help us solve these problems. Drawing upon a large collection of hitherto unused
primary sources, I will suggest a taxonomy that, I believe, would help clarify
ambiguities inherent in the notion. Based on this taxonomy, I will explore when
and why gediks imply barriers to entry and what barriers to entry mean for
eighteenth-century urban economic growth.
One of the most prominent Ottoman legal historians, Ahmet Akgndz claims
that the notion of gedik in Ottoman law should be examined by looking at two
separate meanings the term acquired in two different time periods: During the
early period (up until the eighteenth century), the practice of granting monopolistic
privileges to Ottoman crafts and trades (inhisar) was not yet established and the
term merely referred to the usufruct rights granted to the craftsmen and tradesmen
by virtue of their residence in shops, in particular those shops that were rent out by
religious endowments (waqfs). He traces the origins of this early meaning of the
term to several concepts referring to usufruct rights granted by virtue of residence
and/or improvements to the premises (hakk- karar), accepted by various schools
of Islamic law as early as the twelfth century.8 In the latter period, as the urban
craftsmen and tradesmen granted various monopolistic privileges, Akgndz
claims, the term also acquired the meaning of a license required to practice
particular craft or trade.
However, neither Akgndz, nor other scholars who worked on the rise of gedik in
the eighteenth century, discussed whether these two meanings of the term
(usufruct rights related to permanent tenancy and licensure related to monopolistic
privileges) were equally important in all sectors. Neither, they explained in what
ways gedik implied a rupture from earlier forms of tenancy and licensure. I argue
that gedik, in the late eighteenth-century and early nineteenth-century urban
context, meant still different things in different sectors, which have been conflated
in the literature. The subtle differences in the content of the notion, not at first
apparent in official documents, arise from the accompanying regulations (or the
lack thereof) in a particular sector. In order to clarify the ambiguities inherent in
the notion, I suggest differentiating two kinds of gedik and focusing on how each
one of these relate to the notion of barriers to entry:
7

Yldrm (2008).

In Akgndz (1988), he discusses in detail the meanings of the terms skna, girdar, and hulv. For a brief definition
of gedik and its origins, see Akgndz (1996).
8

Seven Ar, 2012

Preliminary draft, do not quote

i) Gediks as real-estate deeds implying long-term (or permanent) tenancy of a

specific shop for fixed rent, creating opportunities for speculative investment in
real estate markets.
ii) Gediks as occupational licenses limited in number, implying potential (but not
necessarily actually imposed) barriers to entry on a sectoral basis.
I should emphasize that even though these two meanings could overlap in certain
cases, they should be treated separately to understand which functions the
registration and transaction of gediks served in a particular sector. This taxonomy
will enable me evaluate strengths and weaknesses of the existing hypotheses about
the causes and implications of widespread use of gediks and also suggest an
alternative explanation for the proliferation of gedik registrations in the early
nineteenth-century.

GEDIKs as TENANCY RIGHTS

Engin Akarl, who studied on the development of property relations around the
concept of gedik between 1750 to 1840, explained the emergence of gediks as a byproduct of urban craftsmen and tradesmens attempts to preserve their real
incomes against the background of economic difficulties of the eighteenth century.
Financial stringencies of the eighteenth century, Akarl maintained, had led the
Ottoman administration search for ways to share the revenues of pious
endowments, which owned most urban commercial buildings during this period.
As a response to these pressures, administrators of these foundations attempted to
increase their revenues by increasing the rents. By registering their shops as gediks,
the shopkeepers would be able to preserve their permanent rights to tenancy and
resist these rent increases.
How does gedik and permanent tenancy rights relate? In line with the Islamic
jurisprudence, waqfs could be endowed in the form of rent-yielding property,
including urban commercial buildings. Although waqf property had to be
unalienable, long-term or permanent tenancy (which would imply a threat to this
principle) was legitimized by contemporary jurists on several grounds: In the shortterm tenancy, the tenant would not have an incentive to preserve the conditions of
the premises and therefore the value of the estate would go down due to natural
wear and tear. More importantly, frequent fires and sometimes earthquakes would
destroy the buildings and deprive the waqf of its revenues. In case waqf had to take
care of the property, it would have to incur large expenses in an irregular basis.
4

Seven Ar, 2012

Preliminary draft, do not quote

Hence, some Muslim jurists maintained that, in order to ensure stable revenues for
waqf, Islamic law permits the long-term tenancy (icare-i tawila) of the waqf property.9
In order to acquire this right to long-term tenancy, tenants had to make an advance
lump-sum payment (muaccele) to the proprietor (waqf), which would theoretically be
sufficient to restore the building, in addition to the monthly or annual rents
(meccele) they agreed to pay. This arrangement also known as icareteyn (double rent)
was not far from controversial among legal scholars as it created a loophole for the
alienation of waqf property. Yet, although some important figures of the Ottoman
jurisprudence, such as Ebu Suud (d. 1574), the chief juriconsult, disputed that
icareteyn or icare-i tawila as a valid form of rental contract; it was adopted by the
majority of the jurists and seem to have become a common practice in the
seventeenth century.10 Furthermore, through various legal modifications made over
time, the right of long-term lease embedded in the notion of icareteyn paved the way
for use and control of the rented property with greater flexibility.11 As a result, the
tenant, who was referred as the proprietor (mutasarrf) of the gedik, was allowed to
sell, pawn, rent, and bequeath their usufruct rights granted by the icareteyn
contract.12
Akarl, like Akgndz, believes that the term gedik emerged as a particular form of
this long-term tenancy contract. While icareteyn contracts granted stable and
favorable tenancy rights in return for tenants commitment to make necessary
repairs to preserve the value of the estate; gedik referred to permanent usufruct
rights granted in return for the tenants placement of capital inputs required for a
particular craft or trade into the work premise. So although in the late eighteenthand early nineteenth-century court registers the term gedik literally referred to the
tangible equipments required for a particular craft and trade (alat- lazme-i malume);
the way it linked the gedik holder to the property holder (the rule of no eviction as
long as the tenant paid the initially-set rent) makes it clear that it indeed referred to
a specific real estate in which the equipment would be placed. In this sense, the
term was a version of icareteyn where permanent tenancy rights are granted in
9

Akgndz (1988: 356) and izaka (2011: 81).

Akgndz (1988: 356-8, 362-3) One of the prominent Ottoman jurists, Knalzade Ali Efendi (d. 1572),
maintained that as long as the arrangement benefited the waqf, it should be allowed.
10

11

Yediyldz (2003), Barnes (1986).

For instance, the chief juriconsult, Zekeriyazade Yahya Efendi (d. 1643) specified that as priprietors heirs,
daughters also had right to inherit the usufruct righst associated with icareteyn. See Akgndz (1988: 363)
12

Seven Ar, 2012

Preliminary draft, do not quote

return for improvement of the premises through its designation as a commercial

space.
Through gedik, shopkeepers acquired permanent tenancy rights. It is on these
grounds that scholars such as Akarl viewed widespread appeals for gedik as an
attempt to resist rent increases. Yet, icareteyn contracts were already available as a
contract form since the seventeenth century. The question, then, is to what extent
contracts involving gedik assignments were different from icareteyn contracts and
what these differences imply.
In order to answer this question I examined icareteyn contracts from seventeenthcentury and early eighteenth-century and compared their characteristics to the late
eighteenth and early nineteenth-century gedik transactions. Contracts involving
gediks were different from icareteyn in several important ways. The first difference is
a matter of degree. The evidence indicates that gedik owners had more flexibility in
the control and use of the usufruct rights due to the presumed permanency of the
usufruct rights associated with gedik ownership. Second and following from the
first, there was an active secondary market in gediks, in which price of gedik
fluctuated. The third difference is related to the way in which the rights of the
gedik-holder are defined as part of an occupational group (or a privileged section of
an occupational group, i.e., guild masters) in relation to the rights of the outsiders
(both potential entrants and creditors).

i) Permanency of the contract

The usufruct rights granted through icareteyn could be transferred to the heirs
according to the rules specified in the main waqf document, wakfiyya. If there were
no specific instructions, the usufruct rights were transferred to the daughters and
sons in equal shares.13 It was only if the deceased had no heirs that the waqf was
able to reclaim the usufruct rights and make a new contract.14 Yet, several court
cases from seventeenth century indicate that the waqf was still able to interrupt the
permanency of the contract in certain conditions. For instance, when several
partners jointly acquired premises and one of the partners died, the contract had to
be renewed in which remaining partners, if they wanted to keep the usufruct of the

13

Akgndz (1988: 373).

14

1605 (1014) Galata 27: 75b/1 in Kuran (2010: 181-83); 1612 (1021) Istanbul 1: 51b/3 in Kuran (2010: 223-25)

Seven Ar, 2012

Preliminary draft, do not quote

premises, were charged an advance payment once again.15 It is not clear from the
document if the amount charged corresponded only to the shares owned by the
old partner (in other words, remaining partners were allowed to purchase deceased
partners shares) or it indeed meant a re-payment by the remaining partners also
for their shares. The clear statement that the rent had to be renewed, however,
means that partnerships of tenants in icareteyn contracts, at least in the beginning of
the seventeenth century, could be subject to untimely dissolution.
Second, during this earlier period, we find at least one case in which the propertyowner waqf was able to evict the premises just by having to return the advance
payment tenants had made.16 If this case is not exceptional, it means that the
advance payment functioned more like a security deposit in early icareteyn contracts.
Yet, it is also clear from the seventeenth-century court registers that the usufruct
rights acquired through an icareteyn contract was transferrable to third parties. For
instance, in 1605, a certain Mustafa who held usufruct rights of half an oil shop,
rented from Karaelebi endowment through an icareteyn contract, sold his share to
Receb.17 This means the contract continued in case of a partner change.
In all such transactions in seventeenth century, the seller registers that the
transaction takes place with the full consent of the trustee of the waqf (marifet-i
mtevelli-i vakf ile).18 Furthermore, in these seventeenth-century registers, the
usufruct rights of the work premises and the equipment (i.e., horses in a mill or the
painting equipment in a painting shop) are sold separately. While the sale of the
usufruct rights requires the trustees approval, there is no condition (neither waqf,
nor guild approval sought) with regard to the sale of equipment.19
I have examined more than 300 hundred cases from court registers of the late
eighteenth and early nineteenth century and havent yet found any case in which
the trustee or the property holder attempts to evict premises in which gedik was
placed. There is, furthermore, no reference to the permission of the waqfs trustee
1605 (1014) Galata 27: 70b/1 in Kuran (2010: 173-4): dkkan- mezburu mceddeden icar etmek lazm gelp mezburan
dahi talip olduklarnda...
15

16

1605 (1014) Galata 27: 75b/1 in Kuran (2010: 181-83).

17

1605 (1014) Galata 27: 44a/4 in Kuran (2010: 143-44)

Galata 27: 44a/4 (1014[1605]), Istanbul 1: 4a/4 (1021 [1612]); Istanbul 1: 17a/1 (1021 [1612]); Istanbul 1: 51b/3
(1021 [1612]); Istanbul 2: 7a/1 (1024 [1615]); Istanbul 9: 7a/2 (1971 [1661]; Istanbul 9: 151a/4 (1072 [1661]).
18

19

Istanbul 9: 87b/2 (1071 [1661]); Istanbul 1: 4a/4 (1021 [1612]); Istanbul 9: 151a/4 (1072 [1661]).

Seven Ar, 2012

Preliminary draft, do not quote

in gedik transactions. Maybe more importantly in terms of permanency of contract,

in case of the death of a gedik-share holder, his shares seem to have been
automatically transferred to his heirs, indicating that dissolution of partnership was
not a problem. Overall, the evidence from court registers indicates that the transfer
of usufruct rights acquired through an icareteyn contract was more difficult than the
transfer of rights associated with gedik ownership. This relative easiness might
explain formation of an active secondary market in gediks, which I will now discuss.

ii) Price formation in the secondary market

Under the law, in icareteyn contracts, the tenant was able to sell their usufruct rights
to someone else; but according to Akgndz, this payment could not be higher
than the lump-sum amount (muaccele) they paid to the waqf in advance.20 Judicial
opinions and court registers indicate that initially this payment was to be
determined by experts in the field, evaluating the cost of constructing a torn-down
building.21 In the seventeenth-century, for instance, there are various cases of
icareteyn contracts, in which tenants and waqf agree that the tenants would
reconstruct a torn-down waqf property with their own funds and then the cost of
reconstruction estimated by experts would constitute the advance payment (icare-i
muaccele) required for the initiation of the double-rent contract. Also in some cases,
tenants made repairs and the amount they spent was deducted from the advance
payment they had already made.22 This deduction was probably made with a view
to the advance payment that would be recharged at the renewal of the contract
(which also confirms non-permanent nature of icareteyn contracts). In cases in
which waqf used its own resources for the construction of the property, the waqf
seems to have had the right to increase the annual/monthly rent (meccele) above
the amount specified in the icareteyn contract.23 There are, however, very few
examples such as these in primary documents.
Although a narrow attention to legal sources might indicate that advance payment
was determined according to the cost of repair or reconstruction; almost from the
start, the ability to transfer usufruct rights on behalf of icareteyn tenants and the
20

Akgndz (1988), 401-405.

21

Akgndz (1988: 366).

22

1616 (1025) Galata 41: 1a/2. This court register is transcribed in Kuran (2010: 253-6).

23

V I, 4/57/151 (Ca 1169 [1756])

Seven Ar, 2012

Preliminary draft, do not quote

limited supply of real estate implied a tendency for the emergence of a

secondary market in which prices of transferred usufruct rights were determined
according to supply and demand. Before explaining the logic of this argument, let
me present the historical evidence. As early as 1742, we see that the tenancy rights
of the waqf property was sold in auctions, which means muaccele itself was
considered as a source of revenue for the waqf.24 It is quite possible that one can
find similar practices earlier (I havent examined waqf registers of the earlier
period). Although initial justification for long-term or permanent tenancy was
waqfs need for stable revenues against the background of financial difficulties
imposed by urban disasters or careless tenants; it is not hard to imagine higher
advance payments were being legitimized in a similar vein, with reference to
sustaining the income sources of the waqf. The tenants (who held the usufruct
rights granted through icareteyn) were already able to sell their tenancy rights at the
market in the seventeenth century. For instance, in 1612, one of the two owners of
the usufruct rights of a mill dies and his daughter, as the single heir, sells the rights
at an auction to pay the debts of her father. In this case, the other owner purchases
the rights, but it is emphasized that an auction was held and supervised by the
trustee.25 In other words, the partner did not have any priority in acquisition of the
assets.
The reason for the emergence of a secondary market is obvious: First, there was
demand for these tenancy-rights because icareteyn contracts ensured that rent
increases were highly improbable. Second, and maybe more importantly in this
earlier period, the transfer of tenancy-rights at free market prices enabled the
tenants to pay their debts to various actors, including the waqf, to whom rent
arrears could have been due. Although this was not the initial justification for
icareteyn contracts, waqfs which were having troubles collecting rents considered
reallocation of usufruct rights at an auction as a remedy for their financial
troubles.26 Whether the waqf could easily reclaim and resell usufruct rights if the
tenant does not pay his rents is not clear from the documents. In other words, we
do not know if the secondary market, from the perspective of the waqf, served as a
safety net against tenant defaults. Even in cases when the waqf was not able to
evict the defaulting tenant easily, as long as it could reclaim the usufruct rights, he
24

V I, 1/37/166 ( 1155[1742]).

25

stanbul 1: 51b/3 (1612 [1021]).

26

V I, 3/138/527 (S 1165 [1752]).

Seven Ar, 2012

Preliminary draft, do not quote

could get the help of the new tenant for eviction. Unfortunately, we do not have
many examples as to how waqfs dealt with defaulting tenants. The rents being
lower-than-market rates in icareteyn contracts might explain why there were no such
disputes documented in court registers. The waqfs could also expect, in unusual
cases of tenants death-without-heirs, to profit from higher market prices.
The secondary literature maintains that, as in all icareteyn contracts, when a tenant
acquired gedik rights for a particular shop, he would make an advance lump-sum
payment (muaccele) and agree to pay a regular monthly or yearly rent.27 I suspect that
this would be correct only if the gedik rights were acquired from the waqf directly,
implying that the gedik owner was also the tenant of the icareteyn contract. An issue
overlooked in the secondary literature is that this was not always the case: Tenants
of an icareteyn contract could profit from an increase in market rents not only by
selling their usufruct rights but also by subletting the premises for higher rents. In
other words, some of the actual shopkeepers were sub-tenants who could be
charged higher rates than the rates specified by the icareteyn contract. This means
theoretically, and as various cases from the late eighteenth century indicate,
empirically, the tenant of an icareteyn contract could be different from the owner of
gedik, the equipment placed in a shop. In cases where gedik holder is the sub-tenant,
it is not clear if he has to make an advance payment to the waqf or the tenant (i.e.,
an icareteyn contract within an icareteyn). Keeping in mind that the guilds were indeed
able to issue deeds of gedik (known as wardens deed, kethda temessk), we can
assume that potential gedik owners were not expected to pay the waqf or the tenant
a lump-sum amount.
We do not yet know what percentage of gedik owners at the beginning of the
nineteenth century (for which we have the most extensive data) were primary
tenants of icareteyn contracts and what percentage were sub-tenants; neither do we
have accurate information on what percentage of gedik deeds were issued by the
waqf or by the guild. We do, however, know gedik, by definition, implied a
protection against eviction and rent increases, very much like icareteyn contract
originally did. So a gedik owner could resist the attempts of the tenants rent
increase.28 In this case, it would be the price of gedik, rather than the payment for
usufruct rights of the premises, that would go up.
27

Akgndz (1988: 214).

28

M 43, 1 (23 10 1192 [14 11 1778])

10

Seven Ar, 2012

Preliminary draft, do not quote

If most gedik holders were subtenants (and had to deal with tenants rather than the
waqf), this might explain why, in the gedik transactions registered at the court, there
is almost no reference to the role of waqf in determination of the price of gedik. As
long as gedik holder (whether the tenant or sub-tenant) continues to make the
regular rent payments to the property owner, he or she was free to sell, pawn, or
rent the gedik to any potential creditor or subtenant. Although in most court
registers, there is no explicit discussion of how gedik prices were determined, many
cases indicate that the owner of the gedik was able to sell it in auction. In other
words, a gedik holder would be able to sell his gedik for a price higher than the
muaccele (if he is the primary tenant) or higher than the cost of gedik (if he incurred
any costs, obtaining the gedik from the guild). In both cases, value of the gedik
would reflect the excepted capitalized value of paying below-market rents.
There is evidence suggesting that the secondary markets in gediks are more fluid
than the secondary markets in usufruct rights granted by icareteyn contracts: The
cases concerning the transaction of the transfer of usufruct rights in the early
(seventeenth-century) court registers do not seem to be more than four or five per
register. Court registers from the second half of the eighteenth century or early
nineteenth century, on the other hand, contain a high number of transactions. For
instance, a register from 1790-93 contain 65 cases of gedik or gedik-share
transactions.29 The registers from 1816-1818 contain hundreds of such transactions
in various sectors.30
One might argue these quantitative differences might reflect procedural differences
as to the registration of transactions concerning usufruct rights. Such transactions
in seventeenth and early eighteenth centuries might have been registered only in
specific waqf registers and, without a comprehensive study of such documents, it
will be difficult to reach solid comparative conclusions. Yet, without such
evidence, I tend to think the waqf would be inclined to prevent alienation of the
property and, to that end, be more interested in setting limits for the transfer of
usufruct rights; and accordingly, the available evidence reflects a gradual erosion of
waqfs hold over usufruct rights.

29

M 60.

30

M 120, M 121.

11

Seven Ar, 2012

Preliminary draft, do not quote

The fact that the gedik transactions do not refer to any approval by the trustee of
the waqf or the primary tenant of the premises corroborate this point. In the late
eighteenth-century and early nineteenth century, gedik owners seem to be
completely free in how they partitioned their gediks or to whom they sold/pawned
them (Although in some sectors restrictions apply, they are not related to the
claims of the property owners, i.e., waqf, but the guild; which will be discussed in
the next section). There is, furthermore, no connection made between muaccele, or
cost of repair/reconstruction or cost of actual/tangible equipment on the one
hand, and the gedik price on the other. In other words, there is no discussion about
how gedik prices should be formed (Again, there is an exception related to the
guilds interference, which will be discussed below). Lastly, there is no case in
which death of one of the share-holders seems to have implied end of a contract,
as was the case in certain icareteyn contracts. Formation of a partnership through
ownership of a gedik share might be less risky for the gedik owner than formation of
a business partnership, which could more easily end and deprive him from his
tenancy rights.
One question that remains to be answered, however, is why the primary tenants of
an icareteyn contract would consent to granting permanent tenancy right to gedik
holders. For the waqf, the possible reason, we suggested above, was their concern
for stable revenues (incentivizing the tenant for taking care of the premises and,
probably, for paying his rents regularly). But in a situation where tenant-rights were
inherited, permanently transferred to others, or rented out for profit; the problem
is replicated at a lower level: The subtenant would have no incentive to preserve
the building or pay his rents regularly. In other words, what was once the problem
of waqf becomes now the problem of the tenant. There might be another
explanation as to why this second layer of alienation (of the waqf property) was
accepted by the tenants. In order to ensure stable supply in urban centers,
especially in certain sectors which were considered essential for public good,
political administration could have aimed at protecting sub-tenants, those who
were actually engaged in production or retail, against property owners or primary
tenants, enabling them to claim permanent tenancy on real estate. This was indeed
how central administration both justified and attempted to constrain assignment of
gediks to shops in the late eighteenth century.
The aim of gedik, according to official documents, was to ensure economic stability
for shop-keepers dealing with essential commodities (i.e. bakeries, butchers,
12

Seven Ar, 2012

Preliminary draft, do not quote

groceries).31 In other words, sectors involved in necessities were provided some

sort of rent subsidy and protection against eviction. But for various reasons that
are not yet fully clear, members of non-essential sectors also managed to register
their shops as gediks and claim permanent rights of tenancy. Central administration
was not approving of this situation. A court register from 1805 summarizes Sultan
Selim IIIs disapproval of the prevalent registration, usurpation, and transaction of
gediks.32 Expansion of the gedik registration from shops dealing with necessities
(such as bread and meat) to the shops that were not allowed to be registered as
gedik (such as tobacco-dealers, snuff-dealers, barbers, textile producers and dealers,
coffee shops), this document indicates, was accompanied by judicial uncertainty.
While some judges regarded gediks as an illegal practice, others allowed all sorts of
gedik transfers; either the Treasury or those who acquired gediks in legitimate ways
suffered losses.
The implications of proliferation of gediks for the Treasury is not at first apparent,
so let me explain. With the initial issuance of gedik, the property owner could raise
a substantial amount at first. However, the real returns from monthly or annual
rents would decrease over time. If the property owner was allowed to usurp the
gedik after the gedik owner dies and sell it once more, in other words if the gedik
ownership was limited to life-term, this would to a certain extent help property
owner recapture some of the rents in secondary market. Yet, all gedik transactions
indicate that they were inheritable with only a relatively small additional cost (a fee
of transaction to be paid when gedik was transferred)33. Since most waqfs were
either endowed by members of the Sultans family or controlled by central
administration (through tax-farming practices) in this period, a decrease in waqfs
revenues also implied a decrease in the revenues of the central administration. In
other words, while the issuance of new gediks could be a source of revenue in the
Fakat erzak makulesi olan ekmek, et ve bakkal eyas ve bunlara kyaslanan eyalarn satld dkkanlarda kiraclar ereti gibi
durduundan, sz konusu eyalarn bulunmamas Allahn kullarna zarar vereceinden sadece kullara yararl olmak amacyla bu
makule dkkanlarda gedie itibar edilmesi... Akgndz (1988), 411 refers to KS, 1/97, p. 43.
31

Ergin 1995, pp. 637-8 refers to stanbul Kadl Sicilli, numara 98, 12 Rebilahir 1220 (1805). b-evmir-i aliyye kata
ihdas memnuattan olan kahvehane gedikleri dahi kaydolunarak ve mukayyed gediklere kyas ederek her tarafta hevyi gedikler ihdas
ve gh huccet ve gh esnaf kethdalar tezkireleri ile bey u ira ve gedik ashabndan biri fevtolsa terekeden addolunarak tevars ve vrisi
olmayanlarn gedii cnib-i Beytlmlden zabt u furuht olunarak ve hukkm dahi gh; Gedik lt- lzmeden ibret olup emval-i
menkle makulesinden olmakla bey u iras ve zmnnda vka olan devisi sahihtir ve gh Gedik hilf- erdir diye adem-i itibar
ile bazan gedik ashabnn istira in verdikleri akalar dahi mesktn-anh kalmakla telef filhakika gerek ashab- emlk ve erbb-
gedik gn-gn mutazarrr olmakda idikleri zahir...
32

33

There is scant information about these fees. Currently, I am looking for more data.

13

Seven Ar, 2012

Preliminary draft, do not quote

short-term, proliferation of gediks as permanent rent subsidies would mean a fiscal

loss in the long-term. As in the case of life-term tax-farms (malikane), the trade-off
between short-term and long-term revenues would be evaluated differently
depending on the broader context (i.e. immediate fiscal pressure due to war). As
long as the demand for real estate (or more specifically gediks) was increasing, the
administration would also be able to create new source of revenue by establishing
more waqfs and selling new gediks. The existing gedik holders, on the other hand,
would be able to profit from the sale or rent of their gediks in the secondary market
as long as the market is not saturated. The presence of increasing rents for private
investors ( a source that administration would ideally like to capture) as well as the
tradeoff between short-term and long-term revenues for the Treasury might
explain the ambivalent position of the central administration; the fact that it was
explicitly criticizing formation of new gediks, while at the same time condoning it.
There might be also some political economy aspect to the administrations position
with regard to the assignment of new gediks to urban shopkeepers, related to how
much political power various groups were able exert. This will also be discussed in
the next part of the paper.
To sum up, in early icareteyn contracts, waqfs control over transfer of the usufruct
rights held by the tenants were still strong enough not to allow a substantial surplus
generated in secondary market. In the latter period, as rights implied by gedik
ownership became more permanent, a secondary market emerged in which price of
gedik was formed according to the capitalized value of paying below-market rents.
Emergence of this secondary market would imply a potential for speculative
activity (shaped by expectations about gedik prices). In an expanding urban
economy, this would also imply a significant increase in gedik prices over time,
making it more difficult for newcomers to acquire their gediks through their own
financial means and would induce gedik partitioning.

14

Seven Ar, 2012

Preliminary draft, do not quote

Theory Box 1: Gediks as permanent and transferable tenancy rights

Suppose the waqf rents a stall for a rent W. Forever, anyone occupying this stall pays them W.
Now suppose the market rent on the stall is V. Then the waqf is forgoing W-V each year. The
capitalized value of the gedik is (V-W)/r, where r is the discount rate.
In other words, G = (V-W)/r
If we assume that the occupier can freely sell the gedik to someone else and everyone knows that
the W will never change, then any increase in the market rent of stall (V) will have a large effect
on gedik price (G). This means owner of the gedik can make a lot of money as V goes up, but it
also means he bears a lot of risk. As long as the amount of premises available for permanenttenancy are fixed (or increasing at a rate lower than the demand for these premises), the initial
purchasers of the permanent-tenancy rights would be able to sell these rights for profit.
i.e., Suppose r = .05. Then the capitalization multiplies V-W by 20. This implies that any change
in V has a large effect on G..
Suppose W=1 and V = 5*W; that is, since the waqf first fixed the rent, the market rent has
increased 5-fold. Then G = 4/r; if r=.05, then G=80. This implies that G is worth 80 times the
original rent. This shows how this mechanism can quickly make the value of the gedik huge in
comparison to what a tradesman might be able to pay on his own. Thus splitting the G would
be a solution for access to work premises.

GEDIKS AS SECTORAL LICENSES (POTENTIAL BARRIERS TO

ENTRY)
There are two reasons why gediks should be analyzed as occupational licenses:
First, there is a type of gedik which is assigned to people, allowing them to operate
a legitimate business without any reference to the usufruct rights of real estate.
These gediks, also known as moveable gediks (havai gediks), are generally assigned to
itinerant retailers or service providers, such as urban water carriers (sakas) and
roaming bagel sellers (simitis). Ownership of gedik, in this sense, implies access to a
market with barriers to entry, and therefore, a potential for above-market profits or
at least protection against competition. Gediks such as these are not rented or
bought from the waqf and the acquisition does not entail an obvious cost (such as
advance payment in icareteyn). Second, most gedik holderseven the ones that hold
usufruct rights associated with a particular piece of real estateare related to
guilds. As such gedik ownership is sometimes (but not always) is synonymous to
guild membership.
Imagine a guild is fully able to control creation of new gediks, it means one can
acquire gedik by being member of an occupational group, for which they have to
15

Seven Ar, 2012

Preliminary draft, do not quote

pay certain fees. This meaning of gedik, in a sense, is similar to the gedik we
described in the previous part: There is a cost to acquire gediks, which depends on
the rules and regulations of the guild. Lets call this F, meaning membership fees.
There is also a market rent (V) accrued through the barriers to entry. As long as
membership costs do not change (or for some reason, membership to the guild is
acquired through non-economic means), the capitalized value of gedik [G= (VF)/r] would go up, in an expanding market (see Theory Box 2).
Even in cases, when gediks actually refer to tenancy rights, they might at the same
time, be thought as some sort of occupational license. Because, issuance of gedik in
any sector, could be accompanied by restriction of entry into that sector. As such,
the market rent (V) obtained through gedik would include both the rents accrued
through access to real estate with rents lower-than-market rates and the rents
arising from limited output capacity in a particular sector. The cost of gedik, on the
other hand, would include both regular fixed rents (W) and fees (F).
During the second half of the eighteenth century, in various sectors, existing gedik
owners applied to the court, on the basis of imperial decrees they had already
obtained, to officially register their gediks as the only valid ones for that particular
craft or trade. This means most gediks, in late eighteenth and early nineteenth
century, probably contained both types of rent, yet in differing degrees; depending
on how successful the guilds were in both preventing outsiders infiltrating guilds or
emergence of an informal sector. Now, for convenience, let us leave aside tenancyrights and focus on gediks only as occupational licenses. This will help us clarify
the role of guild and specific institutional regulations in determining what gedik
ownership implies.
A license means an official permission to practice a craft or trade. It might be
issued by the authorities or professional organizations. It may require paying a fee
and/or proving a capability. As scholars have already argued, gediks as a
requirement to practice an urban business can be understood as a license. One
question that has not been dealt in depth, however, is how gedik ownership (apart
from tenancy-rights aspect) is different from guild membership. This is an
important question because the notion of license had already existed within the
guild system. In order to practice certain crafts and trades, one needed to be a
member of a guild and acquire the status of master, which implied at least certain
fees and tax obligations. In other words, guild membership or mastership itself
(like admission to the bar) implied barriers to entry. Whether these barriers to entry
16

Seven Ar, 2012

Preliminary draft, do not quote

were personal (depended on status/identity) or impersonal (required a certain

obligation or fee), in other words whether membership was open or not, would
also have some implications for both the degree and the distribution of rents.
The restriction of dealing, known as inhisar- bey ira (or shortly as inhisar), was
already granted in most urban sectors by the law codes specifying the number and
kind of people allowed to perform a trade or profession.34 Only qualified
journeymen, upon approval of the guild administration, were allowed to acquire
the status of mastership (ustalk) and practice the craft himself. In productive
sectors in which skills were important, the status of master was acquired through
in-guild training. In this case, access to privileges associated with mastership would
require first acceptance as an apprentice by a master, which indicate importance of
relations established through social networks, such as family, neighborhood, and
religious community. The importance of social relations also arise from a common
arrangement made to reduce risks in urban shopkeepers dealings with traders:
Shopkeepers needed to stand surety for each other for the purchases they made on
credit (mteselsil kefalet) and personal information was clearly an advantage for
acceptance into such mutual liability schemes.
Another common justification for restricting the number of people in a certain
sector related to the general policy of price stability. Competition among retailers,
was believed to induce an increase in the price of intermediate goods. Hence, the
ideal policy was to encourage distribution of imported intermediate goods through
guild officials and to set the price of final commodities at fair levels. While in
sectors dealing with imported intermediary goods and produces with specific
quality regulations set by the administration, the restrictions were justified easily
with reference to public good; in other sectors, entitlement to ones daily bread was
considered a valid argument against opening of new shops.
Although what I have just outlined is based on the political-legal discourse about
the ideal functioning of an urban economy organized around redistributive,
welfare-maximizing principles and does not necessarily reflect actual practices; it
sheds light on how various groups legitimized their expectations and demands. It
was not unusual for the urban craftsmen and tradesmen to make claims for
exclusive dealing in their sector prior to eighteenth century. For instance, a group
of tinsmiths petitioned the court to stop gypsies working in unauthorized
34

For a brief definition of inhisar, see Encyclopaedia of Islam,2nd ed.

17

Seven Ar, 2012

Preliminary draft, do not quote

locations, arguing that they were hard to track down for tax collection purposes.35
In another case, chickpea sellers tried to stop a potential entrant, claiming that they
held an imperial decree establishing that there should be no more than 16 chickpea rosters in Istanbul. Although in this case the Grand Vizier sided with the
entrant on the grounds that opening of a new shop would do no harm (to the
public),36 in numerous other cases, existing shopkeepers were able to obtain
charters (nizamname) granting them monopolistic privileges by officially setting the
number of legitimate practitioners of a certain craft or trade.
Some scholars have associated the rise of gedik in the late eighteenth century with
the expansion of guilds prerogatives and the exclusive rights associated with guild
membership. As Yi summarizes, especially after the customs of a guild were
written down by the government in the form of a nizam (charter), and gediks were
formally endorsed in it, guild masters considered gedik to be a guarantee of their
monopoly.37 But does this imply [w]ith the advent of gedik, which would often
involve the control of instruments of trade, fixed locations or something tangible
that was a necessary part of engaging in business, a limitation on the number of
practitioners would have had a stronger effect38? I will give some examples of
how gediks became part of guilds monopolistic claims before trying to answer this
question.
One of the earliest case of a collective request for such a charter is dated 1764. A
large group of retailers selling alaca (a type of cloth) imported from Aleppo and
Damascus to Istanbul, asked the court not to allow opening of new shops explicitly
on the grounds of public good. According to the 71 shop-owners (including both
Muslims and non-Muslims), these new shops (which also held gediks themselves)
were not able to pay their debts to the merchants, they raised the prices of the
commodity and furthermore they sold their gediks to outsiders for prices above the
actual value of their shops.39 Their request was accepted and they acquired a decree
which set the legal number of gediks at 71, registering the location for each shop
holding gediks.
35

Yi (2004), 146.

36

Yi (2004), 147.

37

Yi (2004), 151.

38

Yi (2004), 153.

39

C.BLD. 1698.

18

Seven Ar, 2012

Preliminary draft, do not quote

In 1797, producers and sellers of sherbets applied to the court with a charter they
acquired before in order to acquire another decree reconfirming their rights40.
According to the charter, the decree set the number of shops dealing with sherbet
at 43 and maintained that no new shops should be allowed. The shopkeepers in
these shops could not be evicted as long as they paid their rents to the property
owners or to the tenants holding their shops through double-rent. When a shopkeeper died, his gedik would be sold to his qualified son; and if he died without
heirs, his gedik would be sold to one of the qualified journeymen at the auction.
The money acquired at the sale would be used to pay the debts of the shop. There
is no rule specified about the transfer of gedik during gedik holders lifetime.
The reasoning, as explained in this decree, for the protection of tenants is that
these shops required large equipment (firewood and big pans etc.) for the practice
of their trade and like groceries, butchers, and tobacco shops, moving them was
too difficult and costly. Accordingly, in this decree, the location of each shop with
authorized gediks was recorded.
Although it seems such charters were granted to a wide variety of sectors during
the late eighteenth century, they were not at all irreversible. In a decree from 1792,
sellers of aba (coarse woolen cloth) came to the court with a previous charter
granted from the Sultan to prevent sellers of old and used garments from dealing
with new aba. According to this charter dated 1787, those who were not trained in
the guild41 were not allowed to open a shop and even those that already acquired
training in the authorized guild shops were not allowed to open their own shops
without the permission of the guild officials and senior guild masters. There were
in total 25 authorized gediks and when one of the gedik owners died, his gedik
would be sold to the son and if he had no sons to a qualified member of the guild
for its market price (semen-i misil) through the arrangements made by the warden
and senior guild members. Referring to the regulations specified in this charter, the
guild members (including warden, his assistant-yiitba-, 13 Muslim masters and 10
Christian masters) came to the court, to complain about the dealers of old and
used fabrics (specifically referring to 13 Christians) who bought and sold new
woolen cloths (aba and ayak). Upon their request, a new decree was issued to
declare the regulations concerning the marketing of garments and to prohibit other
cloth-dealers to buy and sell new woolens. A few years later, however, in 1798, a
40

K 76, no. 17. (11 Ra 1212 [3 9 1797])

41

Asitanede hizmet ile perverde ve mazun olmayup ham-dest olanlar hrfetimize dahil olmayup

19

Seven Ar, 2012

Preliminary draft, do not quote

certain Mehmet Arif, who is referred as a woolen-cloth dealer, came to the court
complaining about other dealers, preventing him to convert his shop into a woolen
cloth shop. In his request, Mehmet Arif appealed to a decree issued in 1788/89
abolishing barriers to entry (inhisar- bey ira) in non-essential commodities. The
Sultan decided in favor of Mehmet Arif and asked the court to expunge the
regulation setting barriers to entry in the above-mentioned charter in line with the
abolishment of inhisar.42
Although the above-mentioned 1788/89 decree is not available to me, a decree
dated 1791 seems to have re-confirmed the prohibition of barriers to entry in nonessentials. In this decree, Sultan Selim III abolished inhisar in all sectors but those
dealing with primary consumer goods on the grounds that they cause inflation and
harm the consumers.43 While public good had always been part of the legal and
political discourse concerning regulation in urban markets, the fact that Selim IIIs
administration was the first to openly criticize and prohibit inhisar as a general
principle, might explain why shopkeepers would be more concerned with proving
that their monopolistic privileges were in line with common interests by the end of
the eighteenth century.
In another case, a decree abolishing barriers to entry among plasterers, specified
in detail various rules concerning in-guild training (i.e. setting 25 as age limit for
promotion to mastership) and limitations about work site (i.e., separate buildings
for Muslim and Christian plasterers). Although the decree prohibited inhisar in
theory, with the regulations introduced authorities made sure that the occupational
(and seemingly quality-oriented) limitations with regard to who can or cannot
practice continued to prevail.44
In many cases, the exclusive rights presumably granted to specific groups of
tradesmen or craftsmen were infringed by the members of other officiallyrecognized groups. For instance, in 1798, the producers and sellers of sherbet (who
were previously granted gedik rights) came to the court, complaining about akide (a
sugar candy) sellers producing sherbet and thus violating the rights granted to them
by the earlier charter. Akide sellers defended themselves on the grounds of the
42

K 76, no.23 (21 S 1207 [8 10 1792] and (19 B 1212 [7 1 1798]).

43

HAT 192/ 9342 (1205/1791). See Appendix 1 for the transcription of this important decree.

K 76, (1211-1217/1796-1803), no.24: esnaf- mezkurenin yedlerinde olup sened ittihaz eyledikleri evamir-i
aliyyenin mahall-i kaydlar ref terkin ve bu urut- meriyye Bamuhasebe kalemine kayd...
44

20

Seven Ar, 2012

Preliminary draft, do not quote

decree prohibiting barriers to entry. While this argument seems to have resonated
with the court which underlined that sugar was not an essential commodity (erzak-
zaruri), sherbet sellers responded by referring to the earlier decree that fixed the
number of gediks and also to the fact that they and the akide sellers had different
wardens and different organizations enabling specific quality requirements, as was
the case in a great number of other sectors such as flour produces (i.e., different
guild organizations for bagels and breads). In the end, the Sultan decided in favor
of the sherbet producers on the grounds of both the limitation set upon gedik
numbers by the earlier decree and the quality concerns raised by the sherbet
sellers.45
All these examples indicate that gediks do not automatically imply barriers to
entry. Opening of new (legal) shops or the permission to increase production/
marketing capacity in the existing shops did not depend on whether these shops
already had gediks or not. As in the case of alaca sellers mentioned above,
sometimes an erosion of the barriers to entry originated from those shops that
already held gediks themselves. For instance, in 1798, the chief of security in Galata
district was asked to prevent several (specified) bakeries that produce high-quality
bread types (has etmek and francala). The decree in concern explained that the
production of these bakeries led to the decrease in the consumption of regular
bread, causing financial troubles for the bakers and the state, to which they owed
money.46 Nevertheless, the same decree in concern reconfirmed a recent permit
about 25 new shops for selling high-quality bread, previously shut down, but
recently given permission once more to operate. The decision is made at the
presence of the guild officials representing the bakers producing regular bread, the
millers, and the bakers recently authorized high-quality bread. It is clear that the
decision as to how many new bakeries to allow, in other words, how much to limit
additional capacity was made regardless of whether shops in concern held gediks or
not. After all, if a potential entrant in a sector or sub-sector could acquire an
official permission; he could find the building and the equipment required to
acquire a gedik. In other words, the fact that gedik numbers were in general fixed,
does not mean, ipso facto, that supply of gediks was fixed.

K 76, no. 30, (14 Ca 1213 [24 10 1798]): her bir snf kadml-eyymdan ber meluf ve sanat olmak zre akird ve kalfa
olup stur almak ve usta olmak Devlet-i Aliyyemim nizam- kadimelerinden olduundan...
45

46

K 76, no.27, (14 2 1213 [28 07 1798]).

21

Seven Ar, 2012

Preliminary draft, do not quote

The above-mentioned petitions and charters indicate that the guilds attempted to
control creation of new gediks and thereby enforce barriers to entry. One thing
neither specified in these charters nor discussed in secondary literature, however, is
the rules governing transferability of gediks. Some of the above-mentioned charters
maintain that if someone dies, his gedik would be sold to his sons or qualified
journeymen by the mediation of the guild and the amount received would be used
to pay the debts of the deceased. This was, for instance, a common arrangement
for bakers guild, which agreed use of gediks as collateral against bakers debts to
merchants and state.47 What was not discussed in these charters, however, was
whether the gedik owner could sell or rent his gedik to someone else during his life
time. According to the registers of 1815-1818, this was a common practice among
gedik owners. People bought and sold gediks in a secondary market, with clear
speculative expectations.48 Many gediks, furthermore, were divided into shares and
sold to those who were not members of the guild.49
The speculative value of gedik emerged from either the access to real estate with
rents lower-than-market rates, which I discussed above, or from the monopolistic
privileges of the guild. Let me focus on this second component now: Assuming
that the total number of gedik numbers were fixed enabling guild members accrue
monopolistic rents, an increase in demand for the output would imply an increase
in the value of the gedik. As gedik prices increase, it would be more difficult for
potential entrants to enter into the business. This might explain the demand-side of
why most gediks in the beginning of the nineteenth century were divided in shares.
On the supply side, the gedik holders could raise funds or have access to credit,
without necessarily selling/pawning the whole gedik and without needing to find
guarantors in order to borrow. Furthermore, as a result of emergence of a
secondary gedik market (as long as there was no control over potential shareholders), outsiders could acquire a share of monopoly rents created by guilds.

47

C.BLD. 124/ 6199, 14 1214 [11 1 1800], C.BLD. 24/ 1167, 1221 [1806-1807].

The best example of such speculative activity comes from Istanbuls court registers of 1790/92. A certain Hafize,
female Muslim resident of Istanbul, purchases half share of a wheat-cracking shop on credit, to sell it in less than a
month for 38 per cent profit. M 60, nos. 31, 34, 35.
48

Especially among bakers, grocery owners, pastry-shop owners M 60, nos. 13, 101, 102, 156, 159 and the related
entries in M 121 and M 122.
49

22

Seven Ar, 2012

Preliminary draft, do not quote

Theory Box 2: Gediks as occupational licenses and monopolistic rents

Above we maintained, G = (V-W)/r
In essence, V is a function of the profits to be made occupying a certain stall. Those profits
are in part a function of the guild and its power. A powerful guild might imply
monopsonistic and monopolistic privilige, which would affect the value of the gedik.
V = V(P), where P is the price the guild charges for its goods (there is a demand curve
D=D(P), P is an optimal price that follows the demand curve).
From now on, I assume that P is set by the guild as a profit-maximizing monopolist.
Then for a guild member, V(P) is by construction higher than for someone who operates in
a competitive market. Thus the guild makes G worth more than G, if there were no sectoral
monopolistic priviliges.
The price of gedik (G) goes up only when P goes up (i.e., when the demand curve shift
rights). In other words, gedik owner can make a profit on gedik arises if he buys it when
P=P0 and sells when P=P1, where P1> P0.
An implication: If someone buys a share of a gedik, then he/she is in essence sharing the
monopoly profits created by the guild, even without being a member. Because V(P) is a
function of the guilds ability to collect rents from the market.

GEDK and INTRA-GUILD MOBILITY

When a particular group of craftsmen and tradesmen specified their gediks as gediks
specifically belonging to their vocation and fixed their number, this could serve
two purposes. First, it could prevent new entrants to that sector, limiting the
additional capacity, which we discussed above. Second, as Suraiya Faroqhi noted,
masters of the guild could use their gediks to prevent expansion of their privileges
to the qualified journeymen. According to Faroqhi, an increasing number of
journeymen with claims to mastership (and their own shops) was the reason why
masters felt threatened and used gedik to preserve their economic and social
status.50 It is clear that Faroqhi acts upon impressionistic evidence and fails to

50

Faroqhi (1998).

23

Seven Ar, 2012

Preliminary draft, do not quote

address such crucial questions as why the institution of journeymen might have
diffused during the eighteenth century and not earlier.
An increase in the number of journeymen (per master) could have been driven by a
growing market in which guilds masters attempted to raise their profits by not
allowing a proportional increase in the number of journeymen. Yet, we have no
quantitative evidence to test this hypothesis. Faroqhi supports her argument also
by pointing out that gediks were developed first in collective workshops, such as
dyers and tanners, where interaction between masters was much closer than in
other places and fixed rules more necessary.51 But, there is contradicting evidence.
Above-mentioned case of collective petitioning for restriction of legitimate gedik
numbers by a group of tradesmen (not a group of craftsmen working in collective
workshops with relatively expensive capital), for instance, offers a case that does
not fit well with Faroqhis theory. As retailers of imported cloth, working in shops
dispersed throughout the city, alaca sellers demand for restriction of gedik numbers
seem to originate from their concern for increasing competition from outsiders.
The use of gediks by masters to preserve or even increase their market share is
corroborated by archival evidence presented below. But it is not necessarily the
initial or the most important, underlying cause of an expanding gedik market.
Theoretically, the gediks could even serve the existent journeymen as long as they
were used to prevent outsiders entry into the sector. The gedik assignment for a
particular guild would prevent entry of outsiders to the auctions designed to sell
the gedik of a deceased shop-keeper. In this way, the auctions (with limited entry)
would not drive up the price much, enabling existent guild masters or journeymen
acquire these gediks for affordable prices.
Before further elaborating on the theoretical implication of guild organization for
gedik markets, let us look at several cases in which gediks seem to have served as an
impediment to intra-guild mobility.
One of these cases concerns a group of master craftsmen in the weaving business.
In 1797/98, a group among the silk weavers (kemhac), request abolishment of gedik
on the grounds that it was used by the wealthy guild members to prevent the poor
ones from the use of the looms (destgah) and practice of the craft (each destgah
assigned to a gedik costs 400 guru (26.6 pound sterlings)). In other ways, the
petitioners maintained that the unequal access to capital goods originated from
51

Faroqhi (1998), p. 143.

24

Seven Ar, 2012

Preliminary draft, do not quote

economic differences among guild members and assignment of a fixed number of

gediks to highly-valued production means. For the gedik-owners, on the other
hand, these claims were unjustified. In their response, the gedik owners (who were
apparently the guild masters) maintained that there were 432 looms with officiallyassigned gediks and the number was sufficient for the consumption of the city.
They also argued that the petitioners requesting the abolishment of gedik were the
journeymen who were not yet qualified and who had already dared to establish
their own (unauthorized) looms in various locations and produce low-quality
produces.52 The court sided with the masters and decides to punish journeymen
who act against the guild rules. In a court register from 1816/17, the average price
of looms recorded in market transactions was around 1000 guru, two and a half
times what it was fifteen years ago.
In this case, we see that the petitioners complain about the high price of gedik. This
price probably does not reflect only the price of the looms (that would be bought
and sold in a free market). The decree makes it clear that the journeymen, in spite
of regulations, could start their business in unauthorized shops, which means they
were able to acquire looms(although they might be lower quality). The reason why
the price assigned to the loom gediks was because the gedik numbers were fixed
and in this way the gediks served as an official license to practice the craft. In both
cases, by delimiting the number of looms through gedik, the masters aimed
probably not only to prevent competition (driven by an increased number of
authorized master craftsmen) but also to preserve the value of their existent gediks
(licenses) assuming that there was an active gedik market in this period.
The masters of the weavers of brnck (a white cloth made of crepe raw silk) also
seemed to have controlled access to brnck looms. In 1200 (1785/86), the guild
of the weavers was able to obtain an imperial decree specifying their exclusive
rights to practice the craft:53 Only 91 shops (each with two looms) were authorized
to practice the craft. Neither the shop, nor the loom number could be increased.
Gedik of a deceased shop-owner could only be transferred to his son (as long as he
is qualified in the craft) or to his journeymen.

HAT 1413/57568 (1212/1797-98): mesfurun eeri kalfalarmzdan olub lakin kend ahallerinde olmayub henz
sanatmzda mahareti (13) ve ustalklar ve desturlar yok iken hilaf- emr-i ali ve mugayir-i nizam kenar mahallerde ziyade destgah
(14) ihdas ve kalb (sahte) ileriyle ibadullahn zrar ve niza- memzu izmihlal in...
52

53

Stk, Gedikler, p. 16. Similar restrictions apply to also weavers of other types of cloth.

25

Seven Ar, 2012

Preliminary draft, do not quote

While in these cases, masters of the guild seem to have controlled access to capital
inputs and thereby benefit from increasing value of their gediks; in other textile
sectors, there were some regulations favouring journeymen. For instance, the price
of the looms used by muslin weavers (dlbent and ine) and the looms used by a type
of silk weavers (sandal) were fixed by the government.54 Such price controls
probably aimed at preventing an increase in the price of looms that would harm
journeymen. These price controls might have induced emergence of a black
market, yet until now I havent found any complaints on behalf of the journeymen.
Also, in a guild that seem to be more strictly controlled by the central
administration such as klapdanc (producers of silver or gold wire thread), masters
were probably less able to use gediks to prevent journeymens access to capital
goods. The emergence of standard half-shares looms among klabdancs in the late
eighteenth century55 might be interpreted as way to enable increased number of
journeymen acquiring status of masters.
These various cases offer some insights and help us raise further questions to be
explored as to the causes and consequences of gedik markets. We see that gediks
could be used by masters to curb intra-guild competition. As suggested by Faroqhi,
in a sector such as this one which obviously required certain specific skills and
relatively expensive capital goods, the guild was probably more formally-organized
(implying a more hierarchical master-journeyman relationship and a more strictly
definite promotion procedure) compared to others. It is probably not only their
pecuniary interests but also the social structure that guild masters aimed to
preserve by restricting access to the capital goods through requesting a fixed
number of gediks. Accordingly in these sectors, we do not see partitioning of gediks
and sale of gedik shares to outsiders. But, we also see that whether the guild would
be successful in preventing journeymen sharing their rents depended on the sector.
Further research might help us better understand how the pre-existing guild
structure was related to the guilds willingness and ability to set a fixed number of
gediks.
To summarize, the effect of gediks actually depended on two things:
i) whether the gedik holders were actually able to fix the number of gediks
54

Database based on M 121 and M 121.

55

C.BLD 15 (1808).

26

Seven Ar, 2012

Preliminary draft, do not quote

ii) whether the access to secondary market was restricted through non-economic
criteria.
If the first condition was met, the value of gediks would be higher than the value of
gediks that merely imply tenancy rights (a flexible form of icareteyn contract).
Because the market rent on the stall/license (V) would include both rents that
could be charged on the real estate and the monopolistic rents that could be raised
through commercial activity practiced in that stall/with that license. As long as the
market rents on real estate and the demand for output is rising, the value of gedik
(G) would increase. This would induce emergence of a secondary market in which
gedik owners could make profit.
This first item, however, does not itself imply a stronger effect in terms of
barriers to entry. As long as access to secondary is not restricted, gediks (and the
presence of secondary markets) would enable outsiders to access guilds rents from
monopolistic privileges, which was the case in most retailing sectors. When access
to secondary markets is restricted (as was the case in textiles), this could also work
in two ways. As long as the prices of gediks were controlled and journeymens
access to available ones is regulated according to some objective criteria, the
journeymen would benefit from the restriction. If the price of gediks were not
controlled, and the number of journeymen were allowed to increase, masters could
profit at the expense of journeymen.

27