Book Reviews

Acta Oeconomica, Vol. 63 (3) pp. 383–399 (2013) DOI: 10.1556/AOecon.63.2013.3.8 BOOK REVIEWS Lajos Bokros Accidental Occidental: Economics and Culture of Transition in Mitteleuropa, the Baltic and the Balkan Area Budapest: CEU University Press, 2012, 204 pp. The 2008–2012 financial crisis made us forget an extremely important part of Central and Eastern Europe, the Baltic and Balkan regions: the process of transition from communism to liberal democracy. Lajos Bokros’s goal is the “defence of Western civilisation” against the new, eye-catching, and high growth authori- tarian state capitalism based on oligarchic order. These regions are especially important in this “fight” because, culturally, geographically and economically, they stand between East and West. The transition process, which started in 1989, is far from complete, and this timely book is a fresco of the developments of structural reforms in the post-communist countries based on a World Bank matrix of first, second, and third generation reforms. Bokros uses his expertise gained as Hungarian Finance Minister in 1995–1996 and as a global transition advisor to construct an attractive argument: Mittel- europa1 and the other regions reviewed are not accidentally occidental. Even though the communist past had left its mark on people’s behaviour, the transition to an open society is by and large a success story. Using a multitude of facts and examples from Hungary, his home country, mostly as negative examples of do-nots of the current government, Bokros clearly emphasises the needed “re- vival and restart” of strengthening the structural reforms in this dangerous crisis 1 Throughout the book, Bokros uses this German term, which is not merely a geographical defi- nition, but reflects a unique culture and civilization developed in this part of Europe. 0001-6373/$20.00 © 2013 Akadémiai Kiadó, Budapest 384 BOOK REVIEWS environment, in which populist rhetoric may distort the priorities of governmental action. The book is structured in three parts: the first chapter reviews the communist past and its particularities in the three regions; the second chapter covers the reforms implemented in the post-communist societies and their different effects on the economy and state institutions; and finally, in a very short chapter named “Is transition over or not?”, Bokros encourages the continuation of market liberalisation rather than pursuing dangerous populist slips towards oligarchic au- thoritarian state capitalism in this global crisis environment, which he calls the “test of transition”. Arguably, the added value of Bokros’s clear and fresh depiction of the past 20 years of transition is the above-mentioned proposal of seeing the current recession as a test for transition. That market economy needs efficient institutions is not new. In this respect, the author notes the “civilisatory effect of foreign capital and management” (p. 111) and argues that the convergence to Western civilisation, al- though it might seem accidental, is in fact a deliberate process, which most proba- bly would not be reversed after this crisis. Moreover, Bokros actively contributes to the transitology literature with the theoretical (descriptive) and practical (solu- tions) defence of Western civilisation, using examples from Poland, Slovakia, Croatia, Romania, Bulgaria, Serbia, Russia, and the Ukraine. The author first describes communism as an economic and societal system, which used command instead of contract, and vertical rather than horizontal ties between people. He accurately notes that there is planning in market economies as well, but it starts having negative connotations when it is transformed into a command economy, i.e. a “set of compulsory targets to be achieved by way of political command” (p. 13), which leads to an over-centralised bureaucracy. He argues that the biggest problem was not the top-down decision making, but the “brutal dictatorship over needs”,2 in which no freedoms were allowed for the sake of “economic efficiency”. Quoting Hayek, Bokros reminds us that the command economy does not satisfy better consumer’s changing needs and concludes that infor- mation asymmetry is higher in state institutions than in the free markets. Bokros then pursues a classification of the three principal command economy models: classical (Stalinist), Hungarian “goulash communism”, and the Yugoslav model. In the classical model, the economy was incapable of coordinating itself. Consumer preferences were completely ignored, which led to spontaneous upris- ings: East Germany in 1953, Poland and Hungary in 1956. These events, in turn, 2 Here Bokros deliberately used the concept developed in Fehér, F. – Heller, Á. – Márkus, Gy. (1983): Dictatorship over Needs. Oxford: Basil Blackwell. Acta Oeconomica 63 (2013).

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