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The Rules of the Game in Transition: How Informal Institutions Work in South East Europe

In: The Palgrave Handbook of Comparative Economics

Author

Listed:
  • Alena Ledeneva

    (University College London)

  • Adnan Efendic

    (University of Sarajevo)

Abstract

This chapter reviews the literature on the interaction of formal and informal institutions and undertakes empirical tests for the validity of claims about the substitutive role of informal institutions. We address two questions: ‘what works when the formal institutions do not?’ and ‘to what extent do formal institutions constitute real constraints in South East European societies, characterised by strong hold of personalised trust and reliance on personal connections.’ To answer these questions, we analyse survey data from eight countries of South East Europe (SEE). When formal rules fail to be effective, social norms of reliance on ‘trusted people and connections’ predominate as a default option, alongside the complexity of factors surrounding the workings of informal networks that channel and enable such interactions.

Suggested Citation

  • Alena Ledeneva & Adnan Efendic, 2021. "The Rules of the Game in Transition: How Informal Institutions Work in South East Europe," Springer Books, in: Elodie Douarin & Oleh Havrylyshyn (ed.), The Palgrave Handbook of Comparative Economics, edition 1, chapter 31, pages 811-845, Springer.
    • Handle: RePEc:spr:sprchp:978-3-030-50888-3_31
    DOI: 10.1007/978-3-030-50888-3_31
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