Transformation at Work in the New Market Economies of Central Eastern Europe

Article excerpt

Pollen, Anna. Transformation at work in the new market economies of central eastern Europe. London, Sage Publications, 1999. xii+ 260 pp. Tables, annexes, index. ISBN 0-7619-5230-6.

This very interesting book is a comparative study of the transformation of labour relations in the countries of central and eastern Europe - the Czech Republic, Hungary, Poland and Slovakia. The author (who is of Czech origin) critically examines the prevailing cliche on transformation "successes" in this group of countries, compared with other transition economies. Her aim is to examine whether the transformation has actually been as smooth and successful as is often claimed. In so doing, she looks at the sort of situations and obstacles the governments, social partners, enterprise managers and ordinary workers have faced in their adaptation to new market challenges, and the role the international institutions have played in the transformation. The author discusses the major theories of transformation and argues that in order to understand the reform outcomes, proper account must be taken of the full legacy of the past and not just of the communist era. In her view, a large part of the losses that occurred during the transition process were attributable to the simplistic assumptions, wrong conclusions and failures of the decision-makers and their western advisers, and she argues that these losses were not only unnecessary but caused a lot of harm to the countries and the workers, a large number of whom actually lost out as a result of the reform process.

The book is divided into three sections and ten chapters. The first section is in the form of a journey back to the historical origins of the four Visegrad countries1 and an account of the varying role played by nationalism in their reconstruction and independence gained after the First World War. The interaction of nationalist feeling and class relations is reflected in the different directions taken by the countries' national labour movements. For, despite similarities in the policies initiated by the communist regimes after the Second World War, national revolutions and reforms in response to political and economic crises brought significant modifications to the economic systems. The resulting individual paths taken by the four countries in fact laid very different foundations for each country's transformation into a capitalist economy, and this explains current differences between them - though, to outside observers, the countries seemed very similar at the start of their economic transformation. The last chapter in this section discusses command economy theories and transformation theories. The author considers the previous centrally planned system had its own, self-perpetuating structures and dynamics, entirely different from those of capitalism, including "state capitalism". In contrast with the supporters of the "free market", she stresses the importance of history in the transformation process. Unlike the "new institutionalists" who take into account only the communist era, Pollen takes a much longer historical perspective. She also speculates on the extent to which the transformation process has been driven by global forces and on how much margin for manoeuvre was available to the governments.

Section two concentrates on the role of the State and of capital in transformation. In Chapter 4, the author examines the causes and social consequences of the "transition crisis", drawing out the contrasts between the initial expectations of the proponents of "shock therapy" who promised rapid economic restructuring, and the true levels of recession reached even in the most economically advanced countries, entailing major employment losses and persistent, high unemployment levels. The author claims that many of the factors contributing to this considerable economic slump, such as the abrupt destruction of the Council for Mutual Economic Assistance (COMECON), could actually have been avoided. …