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The Great Divide Revisited: Ottoman and Habsburg Legacies on Transition

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  • Valentina Dimitrova‐Grajzl

Abstract

The former socialist countries of South East and Central Europe exhibit great variation in institutional quality. Unlike the sparse existing literature, I claim that the variation can be explained by the legacies of the Ottoman and Habsburg Empires. I identify historical legacies of the Empires, which have affected the current institutional quality of the successor states. I show empirically that the Empires' legacies are key determinants of institutional quality, and that the Habsburg successors have institutions that are more efficient in a market economy than the Ottoman successors. In contrast, I find an insignificant effect of socialism on institutional quality.

Suggested Citation

  • Valentina Dimitrova‐Grajzl, 2007. "The Great Divide Revisited: Ottoman and Habsburg Legacies on Transition," Kyklos, Wiley Blackwell, vol. 60(4), pages 539-558, November.
  • Handle: RePEc:bla:kyklos:v:60:y:2007:i:4:p:539-558
    DOI: 10.1111/j.1467-6435.2007.00384.x
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    1. Palairet,Michael R., 1997. "The Balkan Economies c.1800–1914," Cambridge Books, Cambridge University Press, number 9780521580519.
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    Cited by:

    1. Polugodina, Maria & Grigoriadis, Theocharis, 2020. "East Prussia 2.0: Persistent regions, rising nations," Discussion Papers 2020/8, Free University Berlin, School of Business & Economics.
    2. Suzuki, Taku & Mizobata, Satoshi, 2019. "Social Confusion and Corruption: Investigating the Causes and Effects of a Breakdown of Ethics," Discussion Paper Series 690_v2, Institute of Economic Research, Hitotsubashi University.
    3. Milena I. Kremakova, 2014. "Trust, Access and Sensitive Boundaries between ‘Public’ and ‘Private’: A Returning Insider's Experience of Research in Bulgaria," Sociological Research Online, , vol. 19(4), pages 148-161, December.
    4. BenYishay, Ariel & Grosjean, Pauline, 2014. "Initial endowments and economic reform in 27 post-socialist countries," Journal of Comparative Economics, Elsevier, vol. 42(4), pages 892-906.
    5. Tarabar, Danko, 2017. "Culture, democracy, and market reforms: Evidence from transition countries," Journal of Comparative Economics, Elsevier, vol. 45(3), pages 456-480.
    6. Walker, Sarah, 2018. "Cultural barriers to market integration: Evidence from 19th century Austria," Journal of Comparative Economics, Elsevier, vol. 46(4), pages 1122-1145.
    7. Walker, Sarah, 2020. "Historical legacies in savings: Evidence from Romania," Journal of Comparative Economics, Elsevier, vol. 48(1), pages 76-99.
    8. Ilaria Petrarca & Roberto Ricciuti, 2014. "Synthetic ‘Real Socialism’: A Counterfactual Analysis of Political and Economic Liberalizations," Working Papers 11/2014, University of Verona, Department of Economics.
    9. Amat Adarov & Mario Holzner & Luka Sikic, 2016. "Backwardness, Industrialisation and Economic Development in Europe," wiiw Balkan Observatory Working Papers 123, The Vienna Institute for International Economic Studies, wiiw.
    10. Grosjean, Pauline, 2011. "The institutional legacy of the Ottoman Empire: Islamic rule and financial development in South Eastern Europe," Journal of Comparative Economics, Elsevier, vol. 39(1), pages 1-16, March.
    11. Jan Fidrmuc, 2012. "How Persistent is Social Capital?," CEDI Discussion Paper Series 12-04, Centre for Economic Development and Institutions(CEDI), Brunel University.
    12. Karaja, Elira & Rubin, Jared, 2022. "Θ The cultural transmission of trust norms: Evidence from a lab in the field on a natural experiment," Journal of Comparative Economics, Elsevier, vol. 50(1), pages 1-19.
    13. Djankov, Simeon, 2016. "The divergent postcommunist paths to democracy and economic freedom," LSE Research Online Documents on Economics 118966, London School of Economics and Political Science, LSE Library.
    14. Martin Mendelski & Alexander Libman, 2014. "Demand for litigation in the absence of traditions of rule of law: an example of Ottoman and Habsburg legacies in Romania," Constitutional Political Economy, Springer, vol. 25(2), pages 177-206, June.
    15. Garoupa, Nuno & Grajzl, Peter, 2020. "Spurred by legal tradition or contextual politics? Lessons about judicial dissent from Slovenia and Croatia," International Review of Law and Economics, Elsevier, vol. 63(C).
    16. Uberti, Luca J., 2018. "Corruption in transition economies: Socialist, Ottoman or structural?," Economic Systems, Elsevier, vol. 42(4), pages 533-555.
    17. Djankov, Simeon & Jolevski, Filip, 2020. "The post-communist transition at 30," LSE Research Online Documents on Economics 118920, London School of Economics and Political Science, LSE Library.
    18. Török, Ádám, 2009. "Társadalomtudományi tények és természettudományos módszerek [Social scientific facts and natural scientific techniques]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(12), pages 1067-1087.

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