DOCSLIB.ORG

"Gradualism" and "Big-Bang": a Consideration from Hayekian Perspective

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
比較経済体制学会会報 第34巻 Bulletin of the Association for Comparative Economic Studies vol.34 On the Debate between "Gradualism" and "Big-Bang": A consideration from Hayekian perspective Hiroyuki Okon Wakayama University 1. Introduction After the collapse of socialism in 1989, one of the hottest subjects in economics is concerning with the choice of strategy for marketization of once centrally-planned economies. Tow types of strategies have been considered: "Gradualism" and "Big- Bang" . Chinese success with Gradualism and Russian failure with Big-Bang have intensified the debate between two strategies. Thus so great efforts have been devoted to make sure superiority of one strategy over the other. However, they are almost all, in a sense, in the field of empirical studies. Theoretical analysis of the transition still remain waiting for more greater efforts. One of the reasons for this unbalance between empirical studies and theoretical analysis is the belief that there is no appropriate theory to deal with the unprecedented experiment of transition of socialist economies to market economies. So some "new economics" have been invoked on, including institutional economics, evolutionary economics, or economics of transition. After a brief survey of the arguments on Gradualism and Big-Bang, I would like to insist that, besides of these new economics, a theoretical framework to tackle the trade cycle presented by Friedrich Hayek can provide a useful model to understand the transition of the ex-socialist economy to the market economy. The main purpose of this paper is to direct researcher's attention to the structural problem during marketization of the ex-socialist system. 2. Gradualism and Big-Bang: Two different strategies for marketization As for marketization of the ex-socialist economies, there has been two different approaches. We may call very generally one of them 'Gradualism' and the other 'Big- Bang' respectively. From Gradualism's point of view, we should marketize the ex-socialist economies gradually and partially. It emphasizes the institutional factors in the process from socialist to market economies. Because of its paying much attention to time dimension of the marketization and growth of institutional settings, Gradualism can be replaced by 81 'Evolutionism' . China provides one of good example of such evolutional and gradual strategy. On the other hand, Big-Bang is a position according to which we should and can marketize the ex-socialist economies as radically and thoroughly as possible. That is, we must move as fast as possible on macroeconomic stabilization, the liberalization of trade and prices, monetary convertibility, privatization, and so on. The proponents of this position, for instance Jeffrey Sachs, insist the complete removal of all government regulations in micro economic level and restricted intervention into macro economic level. Russia and Poland, for example, have adopted this neoclassical-pro-market strategy. 3. Three phases of the Gradualism-Big-Bang debate As for the debate between Gradualism and Big-Bang so far, we can divide it into three phases. The first phase is characterized by the enthusiasm in Big-Bang as the most efficient route from the socialist to the market system. From this invisible-hand perspective, all agenda for marketization, their sequence and speed to implement, and the policy strategy were discussed. At this stage, Gradualism was dominated by Big-Bang market euphoria. After a few years then, the second phase came. The poor economic performance led both policy makers and economists to their recognition that marketization might be more difficult, more complex, and more time-consuming process than they thought. Against Gig-Bang, some insisted superiority of Gradualism. What characterizes the third and present phase is a fact that we have many statistical economic data to evaluate the aptness of two strategies. From these statistics, we can observe different performances among countries which have embraced different strategies. As Chinese success with Gradualism is contrasted with Russian failure with Big-Bang, it came to be thought that in order to marketize the ex-socialist system we must chose appropriate strategy in the light of its initial condition. 4. The present state of the debate (1): Some points at issue. With different economic performances observed in the post-socialist economies, the following problems have been presented. (1) How can we evaluate the performances of the ex-socialist countries? (2) Can we relate the different performances with different strategies? (3) If we cannot, what is the reason for the difference of economic performances? (4) What explains China's success and Russia's failure? (5) Is this contrast of performances a proof of Gradualism's superiority over Big-Bang? (6) Can it possible to prove mathematically the dominance of one strategy over the other? In addition to these problems, we have another one. It is what Janos Kornai calls 82 'tra nsformational recession.' He observes that "All the postsocialist countries without exception are suffering from a grave economic recession." Thus we counts this homogeneous phenomena as the seventh problem. (7) Why have all the postsocialist countries experienced transformational recession? Of course, with regard to transition from the socialist system to the market system, there are many other problems. In contrast with seeming simplicity of the transition problem which we concieved immediately after the collapse of socialism, after all, we have now very diverse problems to solve. 5. The present state of the debate (2): A survey of recent inquiries. Here we shall survey some inquiries into the above problems. Sachs (1996) and others present 'Initial Conditions Matter Hypothesis'. According to this hypothesis, the contrast of economic performances between China and Russia must be explained by the different initial conditions which those countries had at the beginning of marketization; Russian economy has been industrialized and 'advanced', Chinese economy is a less developed one. Big-Bang, according to Sachs, is only possible option in Russia. Big-Bang policy is also defended from monetarist point of view. Aslund (1994) criticizes Gradualism of its approval of inflation. He ranks combating against inflation as the most important object to be pursued first. Yavrinski and Braguinsky (1994) explain the Russian failure with Big-Ban by their 'Hysteresis Effect Hypothesis'; because principle -agency relation before marketization has remained and made hysteresis effect, production declined. Dewatripont and Roland (1995) present a mathematical proof that, under conditions of high learning ability and low cost of collecting relevant information, Gradualism dominates Big-Bang. Because they consider the situation in which only two policies are implemented, we can not accept their proof as general propositions. But they have shown that the Gradualism-Big-Bang debate can be treated in more exact manners. Big-Bang is backed by neoclassical economics. After asked and examined its usefulness as the underpinning for marketization, Peter Murrell (1991) answers negatively. Instead, he picks up evolutionary economics for that paprt. It is then Gradualism that can be linked to evolutionary approach to transformation of the ex-socialist system. As for the problem (7) listed above, Kornai himself gives an explanation. We can call it '80% Keynesian -20% Hayekian Hypothesis .' According to this hypothesis, we can understand the transformational recession as follows. Inflation after the price liberalization and restrictive monetary policy eliminated potential effective demands. This decrease in effective demands caused the recession. To this Keynesian factor Kornai adds Hayekian one that marketization is a process of creative destruction which will coordinate demand structure and supply structure. 83 6. A criticism of present researches Although value of these researches can not denied, some criticism may be attempted. (1) Marketization must be analyzed explicitly as a "process." (2) Marketization is a process from socialist system to market system. (3) Although Dewatripont-Roland's conclusions shows a possibility for us to argue some general propositions about the proper strategy, they do not reflect specificity of marketization. (4) Is it necessary to seek for 'new' economics to analyze the process of marketization? And if we take into account a fact that, after the transformational recession, almost all countries show economic recovery (Figure 6-1), we should have the following as very important question to be tackled first. Figure 6-1 Gross Industrial Production. Source; Countries in Transition 1995. ed. by W•¬•¬W, 1995 * All 1994 data are prelimiuary. 84 important question to be tackled first. (5) What is to be explained is a kind of business cycle that happened during transition from the socialist system to the market system. In the light of these criticism, we must keep in mind the following points for our analysis of marketization. (a) The model is needed to be able to analyze marketization as a process. (b) The model is needed which considers the process as from the socialist system to the market system. (c) The model is needed to reflect main characteristic of the socialist system. If we take these points into account seriously, then we had better, I believe, treat the transition as "traverse" between two states with different structures of production. 7. The distorted production structure of the socialist system What is
Load more

Recommended publications
  • Gradualism": the Labour Party and Industry, 1918-1931
    ORE Open Research Exeter TITLE The industrial meaning of "gradualism": the Labour party and industry, 1918-1931 AUTHORS Thorpe, Andrew JOURNAL Journal of British Studies DEPOSITED IN ORE 03 March 2008 This version available at http://hdl.handle.net/10036/19512 COPYRIGHT AND REUSE Open Research Exeter makes this work available in accordance with publisher policies. A NOTE ON VERSIONS The version presented here may differ from the published version. If citing, you are advised to consult the published version for pagination, volume/issue and date of publication The Industrial Meaning of "Gradualism": The Labour Party and Industry, 1918-1931 Andrew Thorpe The Journal of British Studies, Vol. 35, No. 1. (Jan., 1996), pp. 84-113. Stable URL: http://links.jstor.org/sici?sici=0021-9371%28199601%2935%3A1%3C84%3ATIMO%22T%3E2.0.CO%3B2-4 The Journal of British Studies is currently published by The University of Chicago Press. Your use of the JSTOR archive indicates your acceptance of JSTOR's Terms and Conditions of Use, available at http://www.jstor.org/about/terms.html. JSTOR's Terms and Conditions of Use provides, in part, that unless you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at http://www.jstor.org/journals/ucpress.html. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission.
    [Show full text]
  • Cultural Identities and National Borders
    CULTURAL IDENTITIES AND NATIONAL BORDERS Edited by Mats Andrén Thomas Lindqvist Ingmar Söhrman Katharina Vajta 1 CULTURAL IDENTITIES AND NATIONAL BORDERS Proceedings from the CERGU conference held at the Faculty of Arts. Göteborg University 7-8 June 2007 Eds. Mats Andrén Thomas Linqvist Ingmar Söhrman Katharina Vajta 2 CONTENTS Contributers Opening Addresses Introduction 1. Where, when and what is a language? Ingmar Söhrman 2. Identity as a Cognitive Code: the Northern Irish Paradigm Ailbhe O’Corrain 3. Language and Identity in Modern Spain: Square Pegs in Round Holes? Miquel Strubell 4. Struggling over Luxembourgish Identity Fernand Fehlen 5. Language Landscapes and Static Geographies in the Baltic Sea Area Thomas Lundén 6. The Idea of Europa will be Fullfilled by Muslim Turkey Klas Grinell 7. National identity and the ethnographic museum The Musée du Quai Branly Project: a French answer to multiculturalism? Maud Guichard-Marneuor 8. Främlingsidentitet och mytbildning av den utländske författaren [English summary: Mythmaking of the Foreign Author and a Reflection on the Identity as a Stranger: The Case of the Swedish Author Stig Dagerman in France and Italy] Karin Dahl 9. Den glokale kommissarien: Kurt Wallander på film och TV [English summary: Kurt Wallander on film and TV] Daniel Brodén 10. Staden, staten och medborgarskapet [English summary: Studying “undocumented immigrants” in the city with Lefebvre’s spatial triad as a point of departure] Helena Holgersson 3 11. Digging for Legitimacy: Archeology, Identity and National Projects in Great Britain, Germany and Sweden Per Cornell, Ulf Borelius & Anders Ekelund 12. Recasting Swedish Historical Identity Erik Örjan Emilsson 4 Contributers Mats Andrén is professor in The History of Ideas and Science at Göteborg University from 2005.
    [Show full text]
  • Marxism and Reformism
    chapter 5 Marxism and Reformism 1 What were the Theoretical Roots of Reformism? The Tangled Web of ‘Catastrophism’1 The two terms that appear in the title of this chapter, Marxism and reformism, have the singular characteristic of having long lost their specificity in what they denote, and yet also of being used as almost universal categories, as if to desig- nate unambiguous contents whose meaning is generally taken for granted. And the qualities of reformism (reasonableness, pragmatism, gradualism), as coun- terposed to the corresponding lack of such qualities in Marxism (dogmatism, abstractness, revolutionism) are thus fixed in a spatial-temporal dimension in which they always appear the same. Generally, the journalistic-political field has been the privileged terrain for this semantic slippage. But given its weak scientific status, and the inevitable strains coming from themes still running very hot on the political terrain, a far from virtuous circle arises between these political expressions and the institutional spheres meant to be responsible for cool analysis. There are two particular elements that characterise the ways in which this circle tends to be activated: the embryonic-genetic approach, and the absolute counterposition of the terms in question. 1 The ‘catastrophism’ dealt with in this part of the chapter concerns the conceptual whole made to derive (or not) from Marx’s economic categories. As well as this way of considering catastrophism, a not-necessarily-connected and wholly political conception also had a wide circulation, in particular in the Giolittian era. In this latter case ‘catastrophism’ did not consist of the natural result of a process of ‘gradual immiseration’, but of the violent contractions of the passage from the old society to the new one, a passage that would not be without pain.
    [Show full text]
  • Rosa Luxemburg and the Global Violence of Capitalism
    Socialist Studies / Études socialistes 6(2) Fall 2010: 160-172 Copyright © 2010 The Author(s) SPECIAL SECTION ON ROSA LUXEMBURG’S POLITICAL ECONOMY Rosa Luxemburg and the Global Violence of Capitalism PAUL LE BLANC Department of History and Political Science, LaRoche College. Pittsburgh, Pennsylvania, United States Abstract: Rosa Luxemburg’s pungent honesty is evident in her critical-minded and ‘unorthodox’ analysis of the economic expansionism of imperialism that arose out of the accumulation of capital. Despite an idiosyncratic reading and critique of Marx’s Capital, she sought to defend and advance the revolutionary perspectives of classical Marxism. Criticisms and counterpoised analyses offered by Rosdolsky, Bukharin, Lenin, and Robinson have not diminished what are generally seen as brilliant contributions. Militarism, war, and inhumanity are perceived as essential to imperialism in her analyses, and imperialism is seen as central to the nature of capitalism. Luxemburg’s account of global economic development reflect impressive economic insight, historical sweep, and anthropological sensitivity that impress critics as well partisans. Résumé : Le franc parler de Rosa Luxemburg est évident dans ses analyses critiques et ‘hétérodoxes’ de l’expansionnisme économique de l’impérialisme qui a émergé de l’accumulation du capital. Malgré une lecture idiosyncratique et critique du Capital de Marx, elle cherchait à défendre et à avancer les perspectives révolutionnaires du marxisme classique. Les critiques et contre-analyses offertes par Rosdolsky, Boukharine, Lénine et Robinson n’ont pas diminué des contributions communément admises comme brillantes. Dans ses analyses, le militarisme, la guerre et l’inhumanité sont perçues comme essentiels à l’impérialisme et l’impérialisme occupe une place centrale dans la nature du capitalisme.
    [Show full text]
  • Testing the Models of Transition in Practice: the Case-Studies of Estonia and Slovenia Testando Os Modelos De Transição Na Prática: Os Casos Da Estônia E Da Eslovênia
    Brazilian Journal of Political Economy, vol . 36, nº 2 (143), pp . 389-409, April-June/2016 Testing the models of transition in practice: the case-studies of Estonia and Slovenia Testando os modelos de transição na prática: os casos da Estônia e da Eslovênia VILJAR VEEBEL ANDRA NAMM* RESUMO: O presente estudo baseia-se na comparação dos verdadeiros processos de transição na Estônia e na Eslovênia, em 1991-2000, com o objetivo de testar dois modelos conceituais (terapia de choque versus gradualismo) da teoria da transição na prática. Este artigo tem dois objetivos principais, estreitamente interligados. A primeira tarefa é analisar se os caminhos de reforma adotados pela Estônia e pela Eslovênia seguiram os conceitos teóricos da “terapia de choque” e “gradualismo”, os modelos dos estados muitas vezes simbolizados em debates teóricos. A segunda tarefa é avaliar a capacidade dos modelos teóricos para alocar corretamente os exemplos clássicos de países para modelos de terapia de choque e gradualistas. Esta pesquisa procura mostrar quais são as vantagens e as desvantagens de uma abordagem polarizada para modelos de teoria de transição e como esses modelos podem ser melhorados. Palavras-chave: Estônia; Eslovênia; modelos de transição. abstract: The following study is based on the comparison of the actual transition processes in Estonia and Slovenia in 1991-2000 with the aim of testing two conceptual models (shock therapy versus gradualism) of transition theory in practice. This article has two main goals, closely interlinked with each other. The first task is to analyse whether the reform paths undertaken by Estonia and Slovenia followed the theoretical concepts of ‘shock therapy’ and ‘gradualism’, the models the states are often symbolising in theoretical debates.
    [Show full text]
  • Big-Bang Versus Gradualism?
    Big-bang versus Gradualism? Towards a Framework for Understanding Institutional Change in Central ∗ and Eastern Europe ∗∗ Alexander Lenger ***Prelimary version – please do not quote*** “Despite its victory over socialism and its important successes, capitalism has not been introduced successfully everywhere. At the beginning of the third millennium, there still remains the major challenge of bringing about prosperity and growth via well-working market institutions in the poorest (and highly populated) continents, countries, and regions in the world. By introducing capitalism in former socialist economies, the objective, one hopes, is to bring these countries, within an appropriate period of time, to levels of prosperity comparable to those of the most advanced industrialized countries” (Roland 2000: XVIII, author's emphasis). 1. Introduction The end of socialism created a unique opportunity for the people in the countries of Central and Eastern Europe to develop a better institutional framework. As a matter of fact, in many post-communist countries political freedom was followed by economic liberalization leading to democracies with market economies today. However, the transition from central planning to a free market economy was quite different in the countries. While most westernized countries in Central Eastern Europe and the Baltic States (Estonia, Latvia, Lithuania, Poland, Hungary, the Czech Republic, Slovakia, Slovenia and Croatia – hereafter CEE) have already realized functioning markets and joined the European Union the countries of the former Soviet Union (Russia, Belarus, Bulgaria, Albania, the Ukraine, Romania, Kazakhstan, Turkmenistan, ∗ Prepared for the spring conference “Ökonomik, Politische Ökonomie und Psychologie staatlicher Reformen in Europa“, 10.-11. April 2008, Albert-Ludwigs-Universität Freiburg.
    [Show full text]
  • Gradualism Versus Radicalism Grzegorz W. Kolodko
    A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Kołodko, Grzegorz W. Working Paper Transition to a market system: Gradualism versus radicalism TIGER Working Paper Series, No. 60 Provided in Cooperation with: TIGER - Transformation, Integration and Globalization Economic Research, Warsaw Suggested Citation: Kołodko, Grzegorz W. (2004) : Transition to a market system: Gradualism versus radicalism, TIGER Working Paper Series, No. 60, Transformation, Integration and Globalization Economic Research (TIGER), Warsaw This Version is available at: http://hdl.handle.net/10419/140712 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. www.econstor.eu TIGER TRANSFORMATION, INTEGRATION and GLOBALIZATION ECONOMIC RESEARCH CENTRUM BADAWCZE TRANSFORMACJI, INTEGRACJI I GLOBALIZACJI TIGER Working Paper Series No. 60 Transition to a Market System: Gradualism versus Radicalism Grzegorz W.
    [Show full text]
  • The London School of Economics and Political Science
    The London School of Economics and Political Science «Les Belles Années du Plan»? Hendrik de Man and the Reinvention of Western European Socialism, 1914-36 ca. Tommaso Milani A thesis submitted to the Department of International History of the London School of Economics for the degree of Doctor of Philosophy, London, September 2017. 1 DECLARATION I certify that the thesis I have presented for examination for the MPhil/PhD degree of the London School of Economics and Political Science is solely my own work other than where I have clearly indicated that it is the work of others (in which case the extent of any work carried out jointly by me and any other person is clearly identified in it). The copyright of this thesis rests with the author. Quotation from it is permitted, provided that full acknowledgment is made. This thesis may not be reproduced without my prior written consent. I warrant that this authorisation does not, to the best of my belief, infringe the rights of any third party. I declare that my thesis consists of 99,843 words. 2 ABSTRACT The thesis discusses the trajectory of the Belgian socialist thinker and activist Hendrik de Man (1885-1953) between 1914 and 1936 ca, with particular attention to his endeavours to renew Western European social democracy after the Great War. The first half of the thesis deals with de Man’s theoretical evolution. Having become convinced of the inadequacy of orthodox Marxism as a conceptual framework for the Left while serving as soldier and diplomat during WWI, de Man sought to overcome the split between reformism and revolutionary socialism by developing an ethical conception of socialism outlined in the book Zur Psychologie des Sozialismus (1926) and, subsequently, by elaborating planism, a democratic socialist ideology supposedly more in tune with the socio-economic conditions of the 1930s.
    [Show full text]
  • Politicization and European Integration Liesbet Hooghe and Gary Marks
    Crouch & Streeck Part 3 24/4/06 1:48 pm Page 205 8. The neo-functionalists were (almost) right: politicization and European integration Liesbet Hooghe and Gary Marks In a recent paper, Philippe Schmitter laments that ‘no theory of regional inte- gration has been as misunderstood, caricatured, pilloried, proven wrong and rejected as often as neo-functionalism’ (2002, p. 1). And he goes on to expli- cate, embrace and elaborate neo-functionalism in his inimitable way. Almost 50 years of neo-functionalism have taught us a thing or two about regional integration. Neo-functionalism identifies basic building blocks for any valid theory of the subject and, more generally, for any valid theory of jurisdictional architecture. Neo-functionalism argues that regional integration is shaped by its func- tional consequences – the Pareto gains accruing to integration – but that func- tional needs alone cannot explain integration. Regional integration gives rise to potent political tensions. It shakes up relative capabilities, creates new inequalities, and transforms preferences. Above all, it leads to politicization, a general term for the process by which the political conflicts unleashed by inte- gration come back to shape it. Neo-functionalists recognize that a decisive limitation of functionalism is that it does not engage the political conse- quences of its own potential success. What happens when the ‘objects’ of regional integration – citizens and political parties – wake up and became its arbiters? In this essay, we begin by taking a close look at how neo-functionalism and its precursor, functionalism, conceive the politics of regional integration. Then we turn to the evidence of the past two decades and ask how politicization has shaped the level, scope and character of European integration.
    [Show full text]
  • The US Republicans: Lessons for the Conservatives?
    2 Edward Ashbee The US Republicans The US Republicans: lessons for the Conservatives? Edward Ashbee Both Labour’s victory in the 1997 general election and the US Republicans’ loss of the White House in 1992 led to crises of confidence among conser- vatives. Although there were those in both countries who attributed these defeats to presentational errors or the campaigning skills of their Labour and Democrat opponents, others saw a need for far-reaching policy shifts and a restructuring of conservative politics. This chapter considers the character of US conservatism during the 1990s, the different strands of opinion that emerged in the wake of the 1992 defeat, the factors that shaped the victorious Bush campaign in 2000, and the implications of these events for the Conser- vative Party in Britain. George Bush’s 1992 defeat was a watershed, bringing twelve years of Republican rule in the White House to a close. Although constrained by Democratic opposition in Congress, the ‘Reagan revolution’ had, seemingly, ushered in a fundamental shift in the character of US politics. Tax rates had been reduced and there was growing confidence in US economic capabilities. Indeed, Reaganism appropriated a number of the long-term goals that had long been associated with liberalism. In particular, the supply-side policies with which the administration associated itself promised that unfettered mar- ket forces would not only increase overall economic growth but also alleviate poverty and address deprivation in the inner-city neighbourhoods. The USA had also, it was said, regained its place in the world through the arms build-up and military intervention in Grenada.
    [Show full text]
  • Chapter 5 Transition to a National and a Market Economy: a Gradualist Approach
    CHAP05_101-116.qxd 01/14/2004 6:40 PM Page 101 Nishant 310:PQ819:slovch05: Chapter 5 Transition to a National and a Market Economy: A Gradualist Approach Joˇze Mencinger CHAP05_101-116.qxd 01/14/2004 6:40 PM Page 102 Nishant 310:PQ819:slovch05: he transition in Slovenia has been described as gradualist.1 Indeed, Tgradualism was, in a sense, a natural heritage of previous systemic changes, embodied in the country’s initial economic conditions and consistent with its political history. The transition process in Slovenia cannot be disentangled either from the legacy of the Yugoslav type of socialism or from the disintegration of SFR Yugoslavia. Although the reasons for that disintegration remain dominated by political and eth- nic considerations, the prospects of transition and accession to the European Union were among the major real arguments for Slovenia’s secession. The preoccupation of Slovenia’s political leaders, govern- ment, and people with the disintegration of SFR Yugoslavia and the creation of a new country slowed and softened the transition meas- ures undertaken as well. This chapter is structured as follows. The first section describes the repeated failure of attempts at reform and transition in SFR Yugoslavia. The second deals with preindependence policy activities and systemic changes in Slovenia, which were characterized by cau- tious responses to uncertainty. The concluding section analyzes some of the dilemmas and controversies of Slovenia’s transition. THE FAILURE OF TRANSITION ATTEMPTS IN SFR YUGOSLAVIA Economic reform in SFR Yugoslavia (including Slovenia) began in the 1950s, long before those in Central Europe. After 1945, four distinct “socialisms,” defined in terms of the formal allocation of decision- making authority in the economy, can be distinguished in SFR Yugoslavia’s history: “administrative socialism” (1945–52), “adminis- trative market socialism” (1953–62), “market socialism” (1963–73), and “contractual socialism” (1974–88).
    [Show full text]
  • Reflections on the Social Democratic Tradition
    Reflections on the Social Democratic Tradition A discussion paper authored by Andrew Jackson * | March, 2017 *Andrew Jackson is Senior Policy Advisor to the Broadbent Institute. TABLE OF CONTENTS 1.0 Executive Summary ..........................................................3 2.0 What is Social Democracy? . 6 3.0 Social Democracy from the Gilded Age to the Golden Age . 13 4.0 Social Democracy from the Golden Age to the Great Recession . 21 5.0 Conclusion: Contemporary Prospects for Social Democracy .......... 36 6.0 Acknowledgements ........................................................ 41 7.0 Further Reading ........................................................... 42 2 | REFLECTIONS ON THE SOCIAL DEMOCRATIC TRADITION 1.0 EXECUTIVE SUMMARY: The purpose of this paper is to provide a political history, overview and critical evaluation of the social democratic tradition in Western politics with some reference to the Canadian experience. It serves as a starting point for the Broadbent Institute’s new initiative exploring social democratic renewal in Canada, a project that will feature essays from a wide range of left perspectives on the future of social democracy in this critical moment of upheaval, inequality and erosion in democracies around the globe. The term social democracy designates both a social and political movement and a distinctive political theory that developed in opposition to liberal capitalism in the second half of the nineteenth century. As used here, the term social democracy means the full extension of democratic principles to both the social and economic sphere and overlaps closely with the concept of democratic socialism, which denotes building a different kind of economy. Social democracy is about more than capitalism plus a welfare state, and very much remains a goal rather than a reality.
    [Show full text]