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The Bazaar

Opposing the political elite through much of the twentieth century has been the bazaar, an important political, economic, and social force in Iran since at least the time of the Qajar dynasty. The Pahlavi shahs viewed the bazaar as an impediment to the modern society that they wished to create and sought to enact policies that would erode the bazaar's importance. They were aware that the alliance of the mercantile and artisan forces of the bazaar with the Shia clergy posed a serious threat to royal government, as occurred in 1890 and again during the Constitutional Revolution of 1905-07. The emergence of such an alliance in the period from 1923 to 1924 is believed by many scholars to have convinced Reza Shah not to establish a republic, as Atatürk had done in Turkey, but to establish a new dynasty based upon his family.

Reza Shah recognized the potential power of the bazaar, and he was apparently determined to control it. As his secularization programs had adversely affected the clergy, many of his economic reforms hurt the bazaar. His son also sought to control the influence of the bazaar. As a consequence, the bazaar remained a locus of opposition to both Pahlavi shahs. During 1978 the bazaar spearheaded the strikes that paralyzed some sectors of the economy and provided support for the political actions of the Shia clergy. In essence, the feared alliance of the bazaar and clergy had once again come to play a pivotal role in effecting political change in Iran.

The Republic has been much more solicitous of the bazaar than was the Pahlavi dynasty. Several of the early economic programs implemented by the governments of the Republic have benefited the interests of the bazaar; nevertheless, the complexities of managing an economy under the impact of a total war have also forced the central government to adopt economic policies that the bazaar has opposed. Generally, the government leaders have favored varying degrees of state regulation over such economic issues as the pricing of basic commodities and foreign trade, while entrepreneurs, bazaar merchants, and some prominent clergy have opposed such restrictions. These economic issues have been among the main reasons for the emergence of two contentious factions among the political elite (see The Consolidation of Theocracy , ch. 4).

Data as of December 1987