The Political Economy of Democratization
What was the economic scenario facing the new democracies of Southern and Eastern Europe on the collapse of the dictatorships? What consequences did the newly established regimes have for the economies? How far did the type of democratic transition, the strength of electoral support, and the nature of the political consensus influence the economic policies governments adopted and the problems they encountered? To what extent did economic policies converge or diverge in terms of the content and pace of reform? These are the main questions to be examined in this chapter. It will be argued that the type of transition, although initially important in some cases, became increasingly less significant for economic performance, and that this was much more dependent on electoral results and the quality of governments. I will also maintain that electoral support was an important, but not a decisive factor in the formulation of economic policies, and that forms of consensus and certain experiences of political learning sometimes had more influence on these. It will be further suggested that, whilst there was a significant degree of convergence of macroeconomic policies, they diverged notably in terms of the role assigned to social policies and the state. Finally, I will defend the thesis that, in time, democracies were generally able to improve the economic situation.
Basic differences existed between the experiences of Southern and Eastern Europe on the return to democracy. One had to do with the intellectual maps of economic policies: when the Southern European democracies were established, consensus on policy paradigms