Varieties of Capitalism in Central and Eastern Europe : a Ferry Boat Region

Rosta, Miklós (2022) Varieties of Capitalism in Central and Eastern Europe : a Ferry Boat Region. In: The Routledge Handbook of Comparative Economic Systems. Routledge Publishing, London, pp. 500-518. ISBN 9781003144366

Text RostaMiklos-FerryBoat-RoutledgeHandbookofComparativeSystem2023-04-0310_10_09.pdf Restricted to Repository staff only Download (4MB) | Request a copy

Abstract

After their transition, Central and Eastern European (CEE) countries became liberal democracies and capitalist systems, but not without great effort. Twenty years since their regime changes, several of the countries in this region have undergone substantial transformation, but stable pol- itical and economic systems have failed to emerge. In this chapter, I explore why this is the case. Drawing on institutional economics and comparative economic theories, I introduce a new typology of Varieties of Capitalism (VoC) for the CEE region. History and path dependency are also decisive in Central and Eastern Europe: the countries of the region possess a dualistic value system; their informal institutions are characterized by both Western and Eastern values. Western values are linked to the enlightenment and contain elements of substantive democracy, while Eastern values are the opposite. After the regime changes, Western values became dominant in the region, influenced by the European Union and a rejection of the Soviet past. Even if the transition from communism to capitalism satisfies the indicators laid out by János Kornai, this type of capitalism did not stabilize. The determinant factor is whether the capitalist system is democratic or non-democratic. Within these two main types, the coordination mechanism distinguishes the capitalist sub-types. In democratic systems, creative coordination is dominant, whereas in non-democratic systems, destructive coordination is.

Actions (login required)

Edit Item