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Large-scale transition of economic systems: Do CEECs converge towards Western prototypes?

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  • Ahlborn, Markus
  • Ahrens, Joachim
  • Schweickert, Rainer

Abstract

In order to identify convergence patterns among the group of Central and Eastern European Countries (CEECs) we analyze clusters of traditional OECD countries, i.e. EU-15 plus Norway and Switzerland, Anglo-Saxon non-EU countries plus Japan, and CEECs based on macro data on government regulation and spending instead of micro data on firm relations and market characteristics as is usually applied in Varieties-of-Capitalism (VoC) analysis. This framework is supposed to incorporate some of the critique that has been expressed towards the traditional VoC-approach, especially its ignorance of government spending and performance. We acknowledge for the transition aspect by looking at cluster history and principal component analysis for periods of transition. Our analysis reveals that there is consolidation rather than convergence with CEECs being divided in clusters leaning towards CME and LME prototypes respectively. Overall, there are worlds of redistribution within which clusters differ with respect to their mix of - negatively correlated - regulation and innovation. Interestingly, CEECs do not mix up with Mediterranean MMEs, which indeed provide a kind of worst case setting, while Scandinavian CMEs as well as traditional LMEs provide a kind of role model within their respective worlds of redistribution.

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  • Ahlborn, Markus & Ahrens, Joachim & Schweickert, Rainer, 2014. "Large-scale transition of economic systems: Do CEECs converge towards Western prototypes?," Kiel Working Papers 1976, Kiel Institute for the World Economy (IfW Kiel).
    • Handle: RePEc:zbw:ifwkwp:1976
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    1. Valentina Vučković & Ružica Šimić Banović & Martina Basarac Sertić, 2021. "Governance Trends among New EU Member States: Is There Institutional Convergence?," Sustainability, MDPI, vol. 13(24), pages 1-15, December.
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    3. Rapacki, Ryszard & Gardawski, Juliusz & Czerniak, Adam & Horbaczewska, Bożena & Karbowski, Adam & Maszczyk, Piotr & Próchniak, Mariusz, 2018. "Wyłaniające się odmiany kapitalizmu w Europie Środkowo-Wschodniej: przegląd badań [Emerging varieties of capitalism in Central and Eastern Europe: a review]," MPRA Paper 90363, University Library of Munich, Germany, revised 2018.
    4. Farkas Beáta, 2018. "What can institutional analysis say about capitalism in Central and Eastern Europe? Results and limitations," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 54(4), pages 283-290, December.
    5. Sandra Misiak-Kwit & Katarzyna Wlodarczyk & Ewa Mazur-Wierzbicka & Lukas Smerek & Jozef Durian, 2023. "The Human Resources Management System in Slovakia and Poland – Chosen Aspects," European Research Studies Journal, European Research Studies Journal, vol. 0(1), pages 20-39.
    6. Esther Ademmer & Joscha Beckmann & Rainer Schweickert, 2014. "Large-scale Transformations of Socio-economic Institutions," WIFO Studies, WIFO, number 50892, Juni.
    7. Andrea Boltho, 2020. "Southern and Eastern Europe in the Eurozone: convergence or divergence?," Baltic Journal of Economics, Baltic International Centre for Economic Policy Studies, vol. 20(1), pages 74-93.
    8. Alina Georgiana Manta & Gabriela Badareu & Inocentiu Alexandru Florea & Anamaria Liliana Staicu & Cătălin Valentin Mihai Lepădat, 2023. "How Much Financial Development Accentuates Income Inequality in Central and Eastern European Countries?," Sustainability, MDPI, vol. 15(18), pages 1-18, September.
    9. Markus Ahlborn & Rainer Schweickert, 2018. "Public debt and economic growth – economic systems matter," International Economics and Economic Policy, Springer, vol. 15(2), pages 373-403, April.
    10. Joscha Beckmann & Rainer Schweickert & Markus Ahlborn & Inna Melnykovska, 2020. "Drivers of Government Activity in European Countries: Do Partisan Politics Still Divide East and West?," Journal of Common Market Studies, Wiley Blackwell, vol. 58(5), pages 1235-1251, September.
    11. Wrobel, Ralph, 2015. "From independence to the Euro introduction: varieties of capitalism in the Baltic States," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 3(1), pages 9-38.
    12. Ahlborn, Markus & Schweickert, Rainer, 2018. "Public Debt and Economic Growth – Economic Systems Matter," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 15(2), pages 373-403.
    13. Mariusz Prochniak & Magdalena Suska, 2021. "Diversity of Capitalism in Central-Eastern and Western European Countries: Robustness of Results Based on Different Coefficients of Similarity," European Research Studies Journal, European Research Studies Journal, vol. 0(Special 3), pages 584-595.
    14. Rapacki Ryszard & Czerniak Adam, 2018. "Emerging models of patchwork capitalism in Central and Eastern Europe: empirical results of subspace clustering," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 54(4), pages 251-268, December.

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    More about this item

    Keywords

    Varieties of Capitalism; Worlds of Welfare States; Government Spending; Regulation; Cluster Analysis; Transition; Economic Systems; CEECs;
    All these keywords.

    JEL classification:

    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • P10 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - General
    • P51 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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