How the Regulatory Authority Effects Development of Meso Level Competitiveness of Industry: A Research on Istanbul Finance Sector

Abstract

Nowadays, the financial services sector cluster is the sector in which global players are most connected to each other globally. In order to create a highly competitive sector, a solid infrastructure should be completed and a stable institutionalized financial system should be ensured. The aim is to evaluate the relations between the factors affecting the international competitiveness of the finance sector in Istanbul, based on M. Porter's Diamond Model, with a holistic approach. As the results of SEM Analysis on Istanbul, it has been determined that government practices has got indirect impacts on companies’ strategy and competition as a leading factor and also on transportation, although government applications have direct positive effect on legal regulatory infrastructure; market demand conditions, information-technology-based infrastructure, education and HR, workplace-environment, supportive players, and companies' strategic competition policies. These results highlight the importance of institutionalization of financial sectors and supportive laws. JEL Codes: G15, G20