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was the bazaar. That is why you see the bazaar playing an important role
in political matters during the constitutional movement and the Pahlavi
era.™™54 Zibakalam attributes political activism to the bazaar, but his
preceding statements imply that the bazaar acquires independence and
political clout despite not constituting a real bourgeoisie. The reader is left
wondering what mechanism enabled this class to play such a role in
James Bill™s The Politics of Iran is one of the few works that exclusively
studies Iranian politics from a class and group perspective. His 1972
volume studies modernization in terms of class relations and the rise of

Crossick and Haupt discuss how the trading class poses dif¬culties for most social
theories, Marxist and Weberian alike. Geoffrey Crossick and Heinz-Gerhard Haupt,
The Petite Bourgeoisie in Europe 1780“1914 (London: Routledge, 1995).
Jazani, Capitalism and Revolution in Iran, p. 36; and Mohammad ˜Atiqpur, Naqsh-e
Bazar va Bazariha dar Enqelab-e Iran, (Tehran: Kayhan, 1358 [1979]).
Hossein Bashiriyeh, The State and Revolution in Iran 1962“1982 (New York: St. Martin
Press, 1984).
Amir Nakha˜i, ˜˜Tahazzob va Sakhtar-e Eqtesadi,™™ Jame˜eh-ye Salem 7 (Esfand 1376
[March 1998]), 29, emphasis added.
58 Bazaar and State in Iran

the professional-bureaucratic intelligentsia. Although the bazaar plays
only a minor role in his analysis, he refers to the bazaar as the ˜˜symbol
and center of activity™™ of the bourgeois middle class.55 His class analysis
is informed by modernization theory and he adds, ˜˜In contrast to
Europe where important segments of the bourgeoisie became an early
part of the ruling class, in traditional Iran few members of the bour-
geoisie ever moved into upper-class ranks. In terms of power position,
the bourgeoisie middle class has stood approximately between the
bureaucratic and cleric middle class.™™56 Bill places the bazaar in the
middle of Iran™s highly strati¬ed class system, but beyond that he does
not elaborate how its class position and inter class relations changed
during the course of the twentieth century.
Ervand Abrahamian™s meticulous study Iran between Two Revolutions
begins by positing that politics is the interaction between political orga-
nizations and social forces. In turn, social forces are classes, but class as
conceived by E. P. Thompson™s historically speci¬ed conception of
class.57 Thus, Abrahamian traces shifts in the class structure across
twentieth-century Iranian history, while focusing on how classes relate to
one another and not only to the modes of production. Within this larger
story the bazaar is a prime component of the social forces participating in
social movements and placing constraints on the state. Abrahamian
classi¬es the ˜˜bazaar community™™ during the post-1963 era as part of the
propertied middle class, while in other sections it is referred to as part of
the ˜˜traditional forces™™ or the ˜˜traditional middle class.™™58 ˜˜Numbering
nearly one million families this class [the propertied middle class] con-
tained three closely knit groups,™™ writes Abrahamian. ˜˜The ¬rst, which
constituted the core of the class, was the bazaar community with almost
half a million merchants, shopkeepers, traders, and workshop owners.
The second was formed of fairly well-to-do urban entrepreneurs with
investments outside the bazaars. . . . The third group was made up of an
estimated 90,000 clergymen. . . . Although the second and third groups
were not bazaaris in the literal sense of the term, strong family and ¬nancial
ties linked them to the ¬rst group.™™59 Thus, the bazaar exists as an eco-
nomic class, but one that is more related to status and wealth than to the
ownership of speci¬c assets.
James A. Bill, The Politics of Iran: Group, Class and Modernization, (Columbus, OH:
Charles E. Merrill, 1972), p. 12.
Abrahamian, however, does not incorporate Thompson™s moral economy approach
into his analysis. Ervand Abrahamian, Iran Between Two Revolutions (Princeton:
Princeton University Press, 1982).
Ibid., p. 421.
Ibid., pp. 432“4.
Conceptualizing the bazaar 59

One important insight of Abrahamian™s approach is the spatial attri-
bute of the bazaar. Implicitly, Abrahamian™s narrative posits a spatial
component that unites bazaaris as a group and differentiates them from
others. This is, at least, how I think we should interpret his statement
that the urban entrepreneurs are ˜˜outside the bazaars™™ and that bazaaris
have a literal meaning.
A more recent set of studies by Misagh Parsa also conceptualize the
bazaar principally in class terms.60 Parsa™s important research investi-
gates the causes of the Islamic Revolution through a resource mobili-
zation model, and probably more than any other author, Parsa views
bazaaris as the critical actors in the overthrow of the Pahlavi regime.
Parsa broadly de¬nes the members of the bazaar as capitalists or ˜˜tra-
ditional entrepreneurs.™™ Since Parsa™s concern is social mobilization, he
is interested in why bazaars enjoy a high propensity for collective action.
His response is that bazaars enjoy both abundant ¬nancial resources
(stemming from their class position) and, not unlike Abrahamian,
˜˜social solidarity™™ emerging out of spatial concentration.
In short, the bazaar-as-class perspective reminds us that the bazaar
¬rst and foremost is an economic unit and as such plays a role in Iran™s
politics. However, much of this literature has not explained how the
bazaar™s class identity emerges and is reproduced. When scholars have
addressed these issues, as in the case of Abrahamian and Parsa, their
largely astute emphasis on space as a critical characteristic in de¬ning
the bazaars takes away the spotlight from their asset-based under-
standing of bazaars. More generally, Abrahamian™s re¬nements of
strictly economistic notions of class are an acknowledgment that classes
are shaped by forces other than production. But because he includes
such factors as ˜˜common interactions with the mode of administration™™
and ˜˜common attitudes towards economic, social, and political mod-
ernization™™ in his de¬nition, the concept of class becomes so vague as to
dull its analytical power.61 Finally, as Sami Zubaida has pointed out,
class analysis treats social solidarities as the ˜˜givens to the political
sphere. Political institutions and processes themselves play little part in
the constitution of political forces.™™62 Thus, this line of analysis leaves
us little space to ponder the reciprocal relationship between state

Misagh Parsa, Social Origins of the Iranian Revolution (New Brunswick, NJ: Rutgers
University Press, 1989). Misagh Parsa, ˜˜Entrepreneurs and Democratization: Iran and
Philippines,™™ Comparative Studies in Society and History 37 (October 1995); and Misagh
Parsa, States, Ideologies, and Social Revolutions: A Comparative Analysis of Iran,
Nicaragua, and the Philippines (Cambridge: Cambridge University Press, 2000).
Abrahamian, Iran between Two Revolutions, p. 5.
Sami Zubaida, Islam, the People, and the State (London: Routledge, 1989), p. 87.
60 Bazaar and State in Iran

institutions and the Bazaar™s organization and its apparent solidarity “
factors that this study suggests are crucial.

The Bazaar as informal economy
The informal-economy perspective has recently emerged in studies of
urban marketplaces in the developing world. The central tenet of this
literature is that in the developing world the ˜˜self-organized™™ sector that
escapes the purview of state supervision is an untapped engine for
economic growth and already includes a substantial portion of enter-
prises, nonagricultural labor, the urban credit market, and the value-
added produced. Thus, orthodox evaluations of these economies are
unable to account for the unregistered productive and distributive
activities of the informal sector. Introduced in the late 1960s and early
1970s to study the urban poor in Africa, the hypotheses of the informal
economic literature have quickly been adopted by such organizations as
the World Bank and the International Monetary Fund to bolster their
neoliberal call for deregulation.
Since the mid-1980s an growing group of scholars working on the
Middle East have begun to use this concept to understand the urban
economies of the region.63 For example, Diane Singerman claims that
the informal networks of central Cairo help ˜˜their members to penetrate
all levels of society, the economy, and the state.™™64 Singerman is
interested in how the urban poor escape heavy-handed government
intervention and maneuver within Egypt™s gargantuan bureaucracy.
Using ethnographic methods, she recounts how the urban poor tap into
informal networks to achieve individual needs and aggregate interests,
the latter role rendering them political. These ˜˜extrasystemic™™ net-
works, she argues, distribute goods and services based on shared values
or ˜˜familial ethos.™™ Cairo™s urban informal networks are described as a
cooperative and ameliorating force achieving common objectives based
on normative commitments and mutual reciprocity.
Guilain Denoeux is another political scientist who uses the concept of
informal networks to study Middle East urban issues.65 He relates dif-
ferent types of networks to analyze urban social movements in Egypt,

Nicolas S. Hopkins, ed., ˜˜Informal Economy in Egypt,™™ Cairo Papers in Social Science
14(4) (Winter 1991).
Diane Singerman, Avenues of Participation: Family, Politics, and Networks in Urban
Quarters in Cairo (Princeton: Princeton University Press, 1995), p. 173.
Guilain Denoeux, Urban Unrest in the Middle East: A Comparative Study of Informal
Networks in Egypt, Iran, and Lebanon (Albany: State University of New York Press,
Conceptualizing the bazaar 61

Lebanon, and Iran, including the bazaar. Denoeux identi¬es four basic
types of networks “ clientelist, occupational, religious, and residential “
all of which are informal in that they lack written laws and regulations.
His comparisons show that networks may play both stabilizing and
destabilizing roles in the modernizing process and illustrate the
complexities of modernization, with socioeconomic change eroding
some networks, strengthening others, and leading to the emergence of
others. Thus, he concludes that the traditional“modern dichotomy is
analytically inadequate.
Among Denoeux™s cases are the Iranian bazaar™s ˜˜occupational net-
works.™™ Not unlike the discussion in Chapter 3, for Denoeux the main
unifying element of the bazaar is the series of occupational and social
networks that helped shape a collective identity and preserve their unity.
During the 1960s and 1970s, these ties were mechanisms that related
the bazaaris to one another, allied them to the clergy, and mobilized
them against the Pahlavi regime. Denoeux studies the prerevolutionary
bazaar structure to show how it remained resilient and adaptable despite
the socioeconomic changes of the post-World War II era.
These important recent works try to identify mechanisms that facil-
itate collective action by members of the urban economy against the
state. They are able to see these areas as more than historical artifacts
and instead study how they face modern concerns by resorting to local
and everyday means of mobilization, self-help, and reciprocity.
Bazaaris, thus, become agents who engage, and even challenge, the
social structure and political system. The bazaar becomes a series of
¬‚uid, independent, and crosscutting networks based on communal
settings and necessities for survival. This makes an important con-
tribution to the study of urban economies in that it introduces networks
and ties, rather than generalized cultural and group psychology, as the
force that uni¬es marketplaces and allows them to engage in collective
The informal networks approach, however, like the traditional-
modern dichotomy, freezes interactions into two distinct spheres,
namely formal and informal.66 By narrowly de¬ning the bazaar™s
activities as informal, many situations that exist in larger, more central
marketplaces like Tehran™s bazaar will simply not ¬t this analysis. For

Keith Hart, one of the pioneers of the informal economy approach, has re-evaluated his
claims: ˜˜Everywhere, the commanding heights of the informal economy lie close to the
centers of power and reach down to the petty enterprises which ¬rst caught my
attention.™™ Keith Hart, ˜˜Market and State after the Cold War: The Informal Economy
Reconsidered,™™ in Contesting Markets: Analyses of Ideology, Discourse and Practice, ed.
Roy Dilley (Edinburgh: Edinburgh University Press, 1992), p. 219.
62 Bazaar and State in Iran

instance, if a member of the Bazaar does not have a license, but pays
taxes and even resorts to his trade association for tax arbitration, as is a
common occurrence in the Tehran Bazaar, is he operating in the
informal or formal sector?67 While this approach might work for the
marginalized urban poor, it is too rigid a strait-jacket to analyze the vast
Tehran Bazaar that includes institutionalized and legal relations with
state agencies. More recently, scholars have attempted to go beyond
de¬nitional debates and quantitative analysis to analyze the relationship
between the ˜˜formal™™ and the ˜˜informal™™ sector and to investigate the
determinants of informality.68 As we will see in the two subsequent
chapters, bazaar communities are useful spheres to reexamine and break
down the informal“formal dichotomy as they highlight how informal“
formal boundaries are permeable and negotiable.

The Bazaar economy as a product of informational scarcity
Mottahedeh™s life story of a seminary student in prerevolutionary Iran
includes a wonderful passage about the young seminarian™s mother
visiting the Qom Bazaar:
To enter the bazaar was to enter a world of slow formalities and quick wit. It was
a world of old, even ancestral, loyalties. In general it was loyalty that directed his
mother™s steps. Whether it was in the small lane of the jewelers or the spacious
barrel-vaulted central avenue of the cloth dealers, his mother always went to the
same merchant in any section, a reliable friend of the family. She did not just march
up to the ˜˜reliable friend™™ and ask for what she wanted. She always walked around
a bit so that the merchant should know that she gave her custom with some
thought. But no woman could really have made up her mind what to buy just by
examining the entrances to the shops.69
The necessity of reliable friends, the repetitive nature of transactions,
and the dif¬culty of selecting commodities in certain markets became an
analytical question for a number of economists in the late 1960s. George
Akerlof, Joseph Stiglitz, and others reappraised neoclassical models of
markets by relaxing assumptions about information, and in so doing
showed that models of pure competition are seriously undermined by
situations and commodities that inhibit full and symmetrical knowledge

Asnaf no. 92 (Bahman 1379 [February 2001]), 20“1.
M. Castells, A. Portes, and L. Benton, eds., The Informal Economy: Studies in Advanced
and Less Developed Countries (Baltimore: The Johns Hopkins Press, 1989); Ragui Assad,
˜˜Formal and Informal Institutions in the Labor Market, with Application to the
Construction Sector in Egypt,™™ World Development 21 (June 1993), 925“39.
Roy Mottahedeh, The Mantle of the Prophet: Religion and Politics in Iran (New York:
Pantheon Books, 1985), p. 33, emphasis added.
Conceptualizing the bazaar 63

between exchange partners.70 Thus, practices and formal rules must be
developed to alleviate market imperfections and nonef¬cient outcomes
related to transaction costs. Often these institutions are sociocultural
constructs, as in the case of the seminarian™s mother described by
Mottahedeh. Reliable friends provide and signal information about the
buyer, seller, or commodity (e.g. reputation, quality, and credit-wor-


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