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Cutting the red ribbon but not the red tape: the failure of business environment reform in Croatia

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  • Ružica Šimić Banović

Abstract

Hitrorez was an initiative that was supposed to significantly reduce the regulatory burden and improve the business climate. Yet, despite all the institutional and policy transfer lessons applied, this large-scale reform attempt finished abruptly. This article seeks to identify and explain the reasons for its failure and reflect on the influence of path dependence on reform implementation in a fresh capitalist state. Moreover, it provides a transitional society perspective on the duration of reforms, their (ir)-reversibility and the primacy of personal ties and interests over organisational forms and norms. It confirms the persistence and the lack of 'ability to fight against' deeply embedded informal constraints in a post-socialist socio-economic system.

Suggested Citation

  • Ružica Šimić Banović, 2015. "Cutting the red ribbon but not the red tape: the failure of business environment reform in Croatia," Post-Communist Economies, Taylor & Francis Journals, vol. 27(1), pages 106-128, March.
    • Handle: RePEc:taf:pocoec:v:27:y:2015:i:1:p:106-128
    DOI: 10.1080/14631377.2015.992239
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    References listed on IDEAS

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    1. Gérard Roland, 2004. "Transition and Economics: Politics, Markets, and Firms," MIT Press Books, The MIT Press, edition 1, volume 1, number 026268148x, December.
    2. Douglass C. North, 2005. "Introduction to Understanding the Process of Economic Change," Introductory Chapters, in: Understanding the Process of Economic Change, Princeton University Press.
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