Bazaar and State in Iran: The Politics of the Tehran Marketplace

Keshavarzian, a political scientist, studied the Tehran bazaar and its relationship with the state, working from interviews with merchants and from archival research.

His argument challenges the standard account. The conventional view treats the bazaar as a traditional institution whose merchants are religiously conservative, politically oppositional and structurally unchanged, and which supported the 1979 revolution as a natural expression of that character. Keshavarzian argues that the bazaar is not a fixed traditional entity but a network whose structure has been reshaped by state policy in each period.

Under the Pahlavi state, he argues, policies including credit allocation, import licensing and the promotion of alternative distribution channels attempted to marginalise the bazaar, which produced cohesion among merchants and made collective political action possible. That cohesion, rather than any inherent religious conservatism, is what enabled bazaar participation in the revolutionary coalition. Under the Islamic Republic, by contrast, state policies of selective licensing, foundation involvement in trade and the allocation of foreign exchange fragmented the bazaar's networks by creating differentiated access, which reduced its capacity for collective action despite the regime's ideological alignment with it.

The methodological point is that the capacity of an economic group to act politically depends on the structure of its internal networks, and that state policy shapes that structure whether or not it intends to.

The book is academic political economy and assumes some familiarity with Iranian history. The reference has not verified every empirical claim. The general argument, that a commercial community's political capacity depends on network structure rather than on its members' beliefs, has application well beyond Iran.