The Politics of Economic Transformation: Is Third World Experience Relevant in Eastern Europe?

Abstract

Two sets of Third World nations can shed light on the politics of economic transformation in Eastern Europe. First, there are nations that pursued particularly vigorous reforms in the 1980s. They shared three key political features: popular consensus that basic reforms were imperative; antireform groups largely in disarray or suppressed; and substantial executive autonomy in economic management. The first of these features is clearly present in Eastern Europe; the second is questionable; and the third is present but precarious and probably temporary. Second and also relevant to Eastern Europe is the growing group of Third World nations seeking to consolidate political openings simultaneously with major economic reforms. Economic and political liberalization conflict with, yet are crucial for, each other. Proposals that they be sequenced are unrealistic. In Eastern Europe as in the Third World, a crucial dilemma is reconciling public demands for access to decision making with sufficient executive autonomy for coherent economic management.