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Open Research Online The Open University’s repository of research publications and other research outputs Inventing a Capitalist Region: Upper Silesia/Poland - Economic Transformations in Old-Industrial and Post-Socialist Spaces of Central and Eastern Europe Thesis How to cite: Weis, Christian (2007). Inventing a Capitalist Region: Upper Silesia/Poland - Economic Transformations in Old-Industrial and Post-Socialist Spaces of Central and Eastern Europe. PhD thesis The Open University. For guidance on citations see FAQs. c 2007 The Author https://creativecommons.org/licenses/by-nc-nd/4.0/ Version: Version of Record Link(s) to article on publisher’s website: http://dx.doi.org/doi:10.21954/ou.ro.0000ea1c Copyright and Moral Rights for the articles on this site are retained by the individual authors and/or other copyright owners. For more information on Open Research Online’s data policy on reuse of materials please consult the policies page. oro.open.ac.uk Inventing a Capitalist Region: Upper Silesia/Poland Economic Transformations in Old-Industrial and Post-Socialist Spaces of Central and Eastern Europe Thesis Submitted for the Degree of Doctor of Philosophy (PhD) The Open University, Milton Keynes, UK Geography Discipline, Faculty of Social Sciences Christian Weis, Diplom-Geograph Date of Submission: 30th September 2005 Date of Re-submission: 21 sI December 2006 ,\'" V,/( di) (7 I ,)t\,\ :) ~ -> }~"-\ ~ ... , c.)J ~')il U I 1\ '",r/I.;( ;) Abstract Inventing a Capitalist Region: Upper Silesia/Poland Economic Transformations in Old-Industrial and Post-Socialist Spaces of Central and Eastern Europe The thesis explores economic, political and social processes in fonner socialist countries with a case study in one of the biggest conurbations in Europe, Upper Silesia. The ongoing but selective economic processes of global and macro-regional economic integration have been identified as a main issue in geographical research. In particular the nexus between the global and the local seen as a dialectical relationship, composed of multiple and asymmetric interdependencies has stressed the necessity of utilising relational analysis in economic geography. The question emerges in what ways and to what extent increasing economic integration may lead to a socio-economic convergence of places or the development of 'indigenous capacities', spatial peculiarities and legacies to establish themselves in capitalist networks of production. With empirical reference to the Polish conurbation of Upper Silesia and drawing on the analytical framework from Michael Storper's 'Holy Trinity' ("The Regional World", New York, 1997), this thesis analyses post-socialist urban and regional transformations from three angles. l. While Storper analysed mainly 'successful' regions in the West, the research tries to identify the main challenges that face any simple attempt to adapt western (theoretical) approaches within a post-socialist, Central East European context. 2. The thesis then identifies the fabric of political-economic actors and the path dependent 'invention' of a region, here Upper Silesia, and analysis locally and regionally embedded and recombined informal institutions and their capacity for restructuring of an old industrial space. 3. While inter- and intra-regional competition is growing in an 'era of globalisation', the thesis finally investigates the scope for action and 'reflexive' interrelations between administrative, political and economic actors in an 'ordinary region' prior to the accession to the European Union. Acknowledgement This thesis would not have been possible without the constant support and courtesy of my advisors, Prof Allan Cochrane and Or Michael Pryke. I am deeply grateful for their dedicated and unimpeachable criticism and their friendly but authoritative input which enormously facilitated the continuous advancement of my reasoning. Their ceaseless belief in the outcome of my project was an important pre-condition for the successful completion of the thesis. All remaining shortcomings and meanders of the thesis at hand are self­ inflicted. The Open University, Milton Keynes, and the Faculty of Social Sciences/Geography Discipline have funded this work with a generous grant between October 2001 and June 2005. Without this monetary support and the extended funding, the finalisation of this thesis would have been more than difficult. I wish to thank my advisors, and consecutive heads of department, Prof John Alien, Or Phil Sarre, and Prof Steve Pile, as well as the Research School of the OU who all facilitated the financial and administrational framework of this project. The inspiring intellectual atmosphere of the Geography Discipline and their spirited postgraduate group which has been continuously invited to participate in and to contribute to the department's academic culture are much missed. The successful fieldwork in Upper Silesia would not have been possible without the assistance and backing of many individuals. In particular, I would like to thank all interviewees who showed keen interest in my work and were outstandingly co-operative. Above all, I wish to highlight the generous help and thoroughly support of three Polish colleagues. Most notably, I am much obliged to Or Adrian C)bula of the Sociology Department of the Silesian University in Katowice (Uniwersytet Slqskillnstytut Socjologii) who introduced me to the region and acted as my "Upper Silesian confessor" during my stay in Katowice between May and July 2003. It is due to him that I quickly identified the most influential regional organisations, agencies, administrations and their modi operandi. He shared early findings on a regional research project with me (Cybula 2004) and our weekly tete-a-tete greatly helped me to classify the conducted interviews and to understand the implications of Upper Silesian's history. Without the help of Witold TroIka, who works in the Marshal's Office of the Silesian Voivodship (Urzqd Marszalkowski WOjew6dztwa Slqskiego I Gabinet Marszalka), many of the interviews would not have taken place. He shared his far reaching regional network with me and persistently helped me to follow up contacts and to organise interview dates, also beyond his administration. Moreover, he gave me a deep understanding of Katowice and Polish urban cultures. Likewise, I am very thankful to Or Karolina Koc-Michalska for her continuous and warm-hearted support in "surviving" a Polish city. She not only helped me to come to grips with administrative and technical obstacles, but took great care of my social well-being and spare time. It is due to K~olina, her family and friends that I felt very much at home in this exceptional European regIOn. Christian Weis Paris, December 2006 Inventing a Capitalist Region: Upper Silesia/Poland Economic Transformations in Old industrial and Post-Socialist Spaces of Central and Eastern Europe Contents 1 TRANSITIONS AND TRANSFORMATIONS 4 1.1 Shock Therapy versus Gradualism 5 1.2 Doing Research in Old Industrial Areas in Central and Eastern Europe 14 1.2.1 Reflection on the Research Process 17 1.2.2 A Case Study in G6rny Slllsk: Theoretical Design 22 2 INSTITUTIONAL ECONOMIC CHANGE AND SPACElTIME 34 2.1 Elements of the Institutional Approach 39 2.1.1 Transaction Costs 40 2.1.2 Institutional Change 42 2.2 Evolutionary Economics and Regional Development 48 2.2.1 Knowledge, Learning and Innovation 50 2.2.2 Trust, Embeddedness and Networks 56 2.3 The Institutional Turn in Economic Geography 63 2.3.1 The Analytical Framework: Storper's Holy Trinity 65 2.3.2 Short Critique of the Holy Trinity 72 3 BECOMING A POST-SOCIALIST SPACE 75 3.1 Conceptualising Post-Socialist Places and Spaces 76 3.1.1 Spatial Path Dependency and Bricolage 77 3.1.2 Local Reflexivity and the Distanced Urban Economy 80 3.2 From the Socialist to the Post-Socialist City 8S 3.2.1 The Socialist City 86 3.2.2 The Post-Socialist City 92 4 POLISH ECONOMIC AND POLITICAL TRANSFORMATIONS 100 4.1 Institutional Economic Change in Poland and Upper Silesia 101 4.1.1 Privatisation 106 4.1.2 Restructuring of State-owned Mining and Steel Industries 110 4.1.3 Foreign Direct Investment 114 4.2 The Rise of Local and Regional Self-Governance 117 4.2.1 Reform of Regional Self-Government lIS 4.2.2 Contradictions and Short-Comings of Regional Self-Government 121 4.2.3 Regional Development Strategies in the Slllskie Voivodship 124 4.3 Path-Dependencies of Polish Regions 126 5 DOING BUSINESS IN A SURVIVAL ECONOMY 132 5.1 The State-owned Sector 133 5.1.1 The Pennanent Transition: Steel Industry 135 5.1.2 The Pennanent Decline: Coal Industry 146 5.2 The Emerging Private Sector 156 5.2.1 Multinational Corporations: The Case of the Automotive Industry 157 5.2.2 Small and Medium-Sized Companies 172 5.3 Private and State-Owned Firms and the Post-Socialist Market 188 6 DOING POLITICS IN A NEW CAPITALIST TERRITORY 192 6.1 The Region as a Nexus for Transformation 193 6.1.1 Historical Legacies 193 6.1.2 The Re-Emergence of a Regional Identity 199 6.1.3 The Struggle for Regional Power 202 6.1.4 The Divided Regional Power 205 6.2 The Post-Socialist City as an Economic Actor 210 6.2.1 Katowice - The Lack of Vision 211 6.2.2 Gliwice - Being on the Map of Europe 214 6.2.3 Sosnowiec - Risky Public Investments 220 6.3 Regions and Cities in the Process of Transformation 224 7 CONCLUSION: INVENTING A CAPITALIST REGION 226 7.1 Learning to Become Capitalist 227 7.1.1 Local and Regional Self-Governments 228 7.1.2 Finns and Corporations 234 7.2 Trust and Networks in 'Emerging Markets' 240 7.2.1 Identities and Histories 241 7.2.2 Connectedness and Embeddedness 243 7.2.3 Regions as Economic Actors 247 7.3 The Holy Trinity in a Post-Socialist and Old Industrial Region 249 7.3.1 Reflexivity and Bricolage 251 7.3.2 Uncertainty, Risk, and Relationality 256 7.3.3 Technologies, Organisations, and Territory 261 7.4 Conclusion 269 BIBLIOGRAPHY 273 Newspaper Articles & Press Releases 299 Quoted Interviews 300 APPENDIX: METHODOLOGICAL CHOICES 304 2 Maps, Tables, Figures, and Photos Map 1: Poland 17 Map 2: The Core Industrial Area of Upper Silesia (w/o Gliwice) 26 Map 3: Regional Distribution of Unemployment in Poland (last Y.

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