SPP Hosts Historic Conference on Post-Communist Transitions

May 12, 2014

Twenty-five years after the fall of Communism, the School of Public Policy joined with the Peterson Institute for International Economics to sponsor a two-day symposium of political leaders, policy makers and scholars to assess lessons learned and the road ahead. 

The conference entitled "Transition in Perspective" and held in Budapest, on May 6-7, drew an extraordinary group of practitioners and specialists from Russia, Ukraine, Poland, Hungary and many other former Communist countries. They discussed 14 papers in eight different sessions on such aspects as the future of Ukraine, why many economic reforms in Russia and elsewhere are being reversed, and the role of privatization of government enterprises. 

Among the participants were Leszek Balcerowicz, Vaclav Klaus and Anatoly Chubais, architects of economic reform in the 1990s in Poland, Czechoslovakia and Czech Republic, and Russia respectively​, and Lajos Bokros, former Hungarian finance minister and director of the World Bank.​

 Anders Aslund and Simeon Djankov of PIIE will edit a book of essays by the participants to be published later in 2014 by the Peterson Institute.

Two members of SPP’s faculty were in attendance at the conference, assistant professors Cristina Corduneanu-Huci and Michael Dorsch.

Cristina Corduneanu-Huci: This event was much more than a conference. It was a historical reunion of leading economic reformers who shaped the post-communist transitions during the early 1990s. The participants consisted of former high-level politicians and bureaucrats, well-known scholars of transition economics, senior managers in international organizations, as well as private sector representatives. 

As a researcher who works on political economy, I found this gathering fascinating on several levels. First, the stories of macroeconomic reforms told by the policy makers themselves allowed me to better understand the context, the incentives, the stakes, the diffusion processes, and the synergies at work across key actors during the tumultuous years of transition. 

Second, as an instructor, it was a rare opportunity to have in the same room creators of concepts. Some of the participants built the entire vocabulary and theoretical repertoire of transition studies. Whenever we teach the issue of soft budget constraints in our classes, we recognize the work of Janos Kornai. Anne Krueger shaped our understanding of rent-seeking, whereas Leszek Balcerowicz coined the concept of ‘window of opportunity’ – a short period of extraordinary politics that changes the gains and losses triggered by rapid economic reforms. When we introduce our students to the theoretical debates surrounding the pace of transition – gradualism versus shock therapy – we assign Gerard Roland’s work. Thus, many conference attendees generated the very lexicography of transition. 

Finally, the event was also important as a site of memory. The discussion of history by history-makers is always analytically fascinating since it takes place at the intersection of objective evidence and subjective narratives of policy motivations and legacies. Twenty-five years after the post-communist transition, the effects of the reforms are still debated. The event has certainly shed light on their origins.

Michael Dorsch: In addition to the noteworthy politicians and policy-makers that guided the transition to market capitalism during the 1990's in central and eastern Europe, the conference featured leading academic thinkers on the complicated process of political and economic liberalization. 

The papers that I commented on, one by Berkeley economist Gerard Roland and the other by UCLA political scientist Daniel Treisman, provided strong theoretical arguments as to why economic liberalization generally cannot occur without an accompanying liberalization of political institutions. In addition, Treisman's paper provided rather strong empirical evidence that strengthening democratic political institutions is a pre-condition for strengthening the economic institutions that are required for a successful transition to market capitalism. 

The conference was remarkable in that it gathered the practical and intellectual leaders of the transition to market capitalism in the 1990's to reflect on the extent to which the transition has been a success. Refreshingly, the voices were not uniformly self-congratulatory of what has proved to be a tumultuous transition experience for the many of the citizens of liberalizing formerly communist countries.

Anders Aslund of the Peterson Institute for International Economics has written a blog post on the conference which you can read here.