Academic journal article Economics & Sociology

Levels and Factors of Transitional Crisis in Bosnia and Herzegovina, Montenegro, and Serbia

Academic journal article Economics & Sociology

Levels and Factors of Transitional Crisis in Bosnia and Herzegovina, Montenegro, and Serbia

Article excerpt

Introduction

Bosnia and Herzegovina, Serbia, and Montenegro are on a bumpy road to joining the European Union. For them, it has been the most important political and economic long-term goal. However, that road had and still has numerous obstacles, which are manifested as negative factors of influence on the social and economic realities. They generate and determine the low level of social and economic development. In fact, despite some positive processes and advances (in business, tourism, liberalization, civil society, civil and political rights, democracy, freedom of the media, the development of a knowledge society, environment for investments, etc.), the social, political and economic crisis have been reproducing and intensifying for the last 25 years. It is manifested through a number of indicators, including:

- Social, unsuccessful and palliative reforms, weak rule of law, poor governance, absence of formal and informal institutions, strong alternative institutions, criminalization of society, poverty, large social stratification, high administrative barriers, slow progress towards the European Union, gender inequality, systemic corruption, etc..

- Political, dominance of politics over the economy, the fight for the preservation of government, street protests, strikes, incidents in the assembly, political corruption, political privileges, the conviction of high political officials for criminale, charges of election fraud and dictatorship, turbulent political events, etc.

- Economic, underdevelopment (Montenegro has 41%, Serbia has 35%, Bosnia and Herzegovina has 29% of the EU-28 development), high unemployment (27% in BiH, 16% in Montenegro, 23% in Serbia), high public debt (70% of GDP - about €3 billion) with a tendency of rapid incrfease, high level of gray economy, inadequate economic policy (neoliberal), heavy dependence on foreign direct investment and its tendency to fall, collapsed economic infrastructure, weak competitiveness, etc (CBCG, 2014; Vlada Crne Gore, 2014).

It is difficult to empirically determine the real level (degree) of those indicators. Therefore, but also because of the heterogeneity of these indicators, it is impossible to objectively determine the real and the overall level of crisis. Due to partial evaluations, we have decided to present the survey of 1500 respondents (500 respondents per country). They spoke about their perception of the socio-economic crisis level as a dependent variable, and the five key factors of influence, that we selected as independent variables, a) path dependence - factors inherited from the crisis of socialism, b) globalization, geopolitical and geo-economic impacts, c) the responsibility of governing structures, d) deficit of realistic and pluralistic institutional changes, and e) the neoliberal economic policy. Understandably, all these factors have acted synergistically, although, they had various degrees of influence on the level of crisis, both individually, and together in all three countries that have been the subject of the research. In addition, the crisis has been constantly intensifying and increasing throughout the whole transitional period, but again is differently observed in the monitored countries. Therefore, the main task of the above research is to show the perceptions of respondents about the level of the current crisis and the degree of the certain factors of influence, both individually and as a whole (average) for all three countries.

1.Theoretical framework

These three countries are relatively small and underdeveloped in terms of their geographical size and population, geopolitical importance, market size and aggregate demand, production, investment, export, and technological potential. According to many non-economic indicators (political stability, democratization, liberalization and institutionalization of society, law, infrastructure development, safety, security, investment, compliance with environmental and social standards, efficiency of the legal system, human rights respect, etc. …

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