Economics Performance and Institutional Economics in Poland after 1989

By Ziomek, Agnieszka | The American Journal of Economics and Sociology, November 2010 | Go to article overview

Economics Performance and Institutional Economics in Poland after 1989


Ziomek, Agnieszka, The American Journal of Economics and Sociology


Introduction

Institutional economics is a unique way of looking at the economy and the processes that influence its development. The uniqueness refers mostly to its difference from neoclassical economics. Starting from the mid-1990s, Poland witnessed an active interest in heterodox economics, including many other economic trends, apart from mainstream economics. The reasons behind this interest are related to the practical economics on the macroeconomic level. One of the reasons for the development of heterodox economic research was that the theses about the end of the transformation process in Poland, which appeared before the end of the 1990s, were inconsistent with the statistical data illustrating the state of the Polish economy. The development of a few branches of economy and of a few markets does not equal the development of social institutions, better welfare of people, or better access to social services. The state of the Polish economy after 20 years of transformation brought an increased interest in the alternative approaches of the economy that could be useful in explaining economic phenomena and pointing to the proper changes in economic policy.

Apart from a number of trends in heterodox economics, currents in institutional economics (IE) are also of great interest. After 1989, orthodox economics was dominant in Poland both in teaching and practical economics. During the late 1990s, the renewed interest in IE turned out to be essential for the understanding and explanation of the current socioeconomic situation, as it exerted a strong influence on the market and on the implementation of new economic reforms. The socioeconomic situation of that time involved the privatization of State Treasury assets, and its consequences, illegal employment and the development of the gray economy. Papers, published mostly in Poland, explained economic processes by the means of the methods of institutional economics. However, it has to be noted that those papers presented the methods of new institutional economics (NIE). A number of them failed to include the historical context and descriptive studies that are characteristics of traditional institutionalists. NIE is an attempt to fuse mainstream economic theory with the traditional institutional economics (TIE) and shows several trends. Those trends include: the new theory of the firm (Coase 1990, 1992, 1998), social and public choice theory (Buchanan and Yoon 2003, 2008), the theory of international regimes, a new economic history, and the theory of transaction costs (North 1994, 2003). What seems to be important is that NIE always seeks to set economic phenomena within the institutional environment. Due to the fact that NIE has an exploitative attitude toward institutions, one can postulate that it does not refer to IE at all. Moreover, it does not fully resemble neoclassical economics, as it ahnost entirely rejects the neoclassical theory of the firm, the neoclassical perception of market mechanism, and the construction of the homo oeconomicus model.

Still, taking into consideration its explanatory values, the IE, with its holistic character and historical and evolutionary outlook on socioeconomic phenomena, was overlooked in scholarly works. NIE, on the other hand, is still dominant in the published theses and articles.

Due to the fact that IE, and especially NIE, have been the fields of scholarly interest for a relatively short time, the works published in Poland point to the application of the selected institutional arguments, rather than to the full and complete implementation of the institutionalist method of traditional institutionalism and NIE. Many authors (1) make occasional and indirect references to institutionalism, not wishing to implement the theory in its entirety.

The aim of the article is to present a number of selected social and economic phenomena that are of great interest to the scholars investigating the TIE and NIE. …

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