Reconsidering Cross-Border Interactions: Balancing the Scales

Abstract

This chapter considers four major aspects of globalization in state socialist East Central Europe, which also serve as a basis for assessing the soundness of new and older mainstream interpretations: trade, capital movements, information flows, and the movement of people. The East Central European state socialist countries achieved a relatively low level of globalization between World War II and the period of regime changes, which is evident in all the aspects surveyed. At the same time, there is no empirical evidence to support the claim that globalization in the region decreased in the two decades leading up to the regime changes. On the contrary, during the latter period, globalization advanced slowly but steadily in the East Central European countries. The gradual increase in openness was facilitated by the growing complexity of their economies, growing consumer demands, and the ongoing globalization of the world at large, as well as by rapid technological change, such as the spread of new information and communication technologies. From the 1970s onwards, the region also experienced internal divergence: the international openness of Poland and Hungary increased more significantly than that of Czechoslovakia.

Globalization is a multifaceted phenomenon, and, in our view, it includes three aspects in particular. These are as follows: (1) the intensification and geographical expansion of cross-border relations and flows; (2) the growing interdependence between the societies of the world; and (3) the rising social awareness of these very processes worldwide.¹ Of these, the focus is on flows here, which can be examined from several angles. Attention can be paid to their presence in different areas; hence, we can speak of economic, political, military, cultural, social, and ecological globalization. Exploring each of these areas in equal depth within the scope of a single book has inherent limitations, especially in the context of an empirical historical study such as ours. Instead, in what follows, the character and scale of state socialist globalization are explored by a survey of cross-border flows. Four main types of flow across borders are examined: goods and services, capital, information, and people. The choice of these areas is by no means arbitrary, as they are central to the literature on the subject.² The majority of cross-border flows can arguably be classified into the four broad categories selected for analysis.

Even though the discussion will be limited to selected areas of globalization, the dimensions we focus on substantially overlap with several aspects we do not directly address. A more substantial limitation is that globalization and internationalization cannot be sufficiently separated in the research process. Cross-border flows have different qualities: some of them only occur between neighbouring countries, others are transplanetary movements, and many fall in between. Oftentimes, interactions between different societies are phenomena of a more limited scope than transcontinental relations, wherefore, in the strict sense, they fall—if not exclusively—into the category of internationalization. However, the expansion of shorter-term links within a given continent tends to go hand in hand with the spread of connections across the globe, so that internationalization and globalization complement and reinforce each other. Accordingly, much of the literature considers that globalization does not only encompass truly global interactions, but also the spread of other types of international relations.³ Therefore, not only does separating globalization from internationalization raise a host of practical research problems, it is also infeasible on conceptual grounds. In fact, it has never been achieved in the context of empirical historical studies. Despite these shortcomings, we believe that the applied approach provides an appropriate framework for research.

2.1 Foreign Trade: The Short Shadow of COMECON

A key component of the globalization process is the worldwide flow of goods and services. International trade is not only related to economic activity, but also encourages travel and facilitates the development of personal contacts across borders as well as contributing to the intensification of a range of other flows. Accordingly, when studying the globalization of a country or region, the development of foreign trade is of particular interest.⁴ The more involved a country is in international trade, i.e., the greater its trade openness, the more globalized it is in economic terms. At the same time, a distinction can be drawn between de facto and de jure dimensions of trade openness.⁵ De facto openness is usually characterized by various indicators of external trade flows, while de jure openness is influenced by the institutional basis of the external economy, in particular the legal regulation of foreign trade.

The most commonly used measure of de facto trade openness—and hence of this dimension of globalization—is the ratio of foreign trade flows, i.e., the sum of exports and imports of goods and services, to gross domestic product.⁶ However, the term ‘openness’ can be somewhat misleading in this context, as low levels of openness do not necessarily imply high tariffs or extensive non-tariff barriers to trade, but are often the results of other factors.⁷ One of the determinants is the size of the economy; small countries tend to be better integrated into the world economy than larger ones, as they can usually produce fewer types of goods and services, and thus need to import more to meet domestic demand.⁸ Differences in trade openness across countries are also explained by other factors, such as their geographical distance from their potential trading partners, their trade policy preferences, and the structure of their economies, in particular the weight of place-bound services. Another important determinant is the degree of their embeddedness in global production chains, as measured trade volumes may include a significant share of re-exports and intra-firm trade by multinational firms, especially in terms of intermediary products.⁹

Literature contains various efforts to adjust trade openness indicators to correct for size-related distortions.¹⁰ The main limitation of these calculations is that they are ad hoc, i.e., they do not have a sound theoretical basis. Moreover, the data for such computations are not available historically for state socialist and post-communist countries. Thus, in what follows, trade openness will be analysed in the standard manner indicated above.

The long-term data demonstrate that de facto trade openness in the East Central European state socialist countries was relatively low and changed little during the 1950s and 1960s. Their trade flows as a percentage of gross domestic product increased in the 1970s and shifted only slightly in the decade that followed.¹¹ By contrast, the early 1990s brought a marked turn, with the economies of the countries in the region becoming much more open, as evidenced by the contribution of exports to their GDP (Fig. 2.1).¹² Meanwhile, there were significant differences in the dynamics of change within the region. While Czechoslovakia—and its successor states, the Czech Republic and Slovakia—and Hungary showed greater openness and achieved a high degree of trade integration by the 2010s even in broader international comparison, this was less the case for Poland, which may be partly explained by size differences across the countries as suggested above. However, it is clear that for the region as a whole, the regime changes can be seen as a major turning point in terms of the degree of trade openness.

Fig. 2.1

Trade openness of East Central European countries, 1980–2013 (combined value of exports and imports of goods and services as a percentage of GDP) (Sources UNCTAD Stat, various volumes [the author’s own calculations]; https://unctadstat.unctad.org/wds/TableViewer/tableView.aspx, accessed 22 September 2022)

The dynamics of de jure trade openness in the region are very similar to what we have observed concerning de facto trade openness so far. This is not surprising, since legal regulation and other institutional features strongly determined the evolution of foreign trade intensity. Nevertheless, the differences between the individual East Central European countries were smaller in this respect than those found for de facto trade openness, in the period both before and after the regime changes.¹³

The relatively moderate rates of trade openness are attributable to important systemic features of the Soviet-style economic regimes. State ownership, centrally planned economy, bureaucratic regulations, and the lack of currency convertibility were major barriers to their integration into the world economy.¹⁴ The pursuit of self-sufficiency also featured prominently among these obstacles. An important element of central planning was the state monopoly on foreign trade, which facilitated the comprehensive implementation of various restrictions and the control of the direction of trade. This policy was fully in line with the behaviour of companies conditioned by the operational logic of centrally controlled economies.¹⁵ As János Kornai amply illustrated, companies tended to avoid exports, as it was much easier for them to sell their products and services domestically where the economy of shortage essentially created a sellers’ market. Export aversion was particularly prevalent in the case of deliveries to capitalist countries, where the quality requirements were higher, and state socialist firms did not necessarily benefit from efforts to meet them since their extra revenues were redistributed by the planning bureaucracy or other authorities.¹⁶

Primarily on ideological grounds, policymakers in Eastern Europe preferred and encouraged intra-COMECON trade relations in the first decades of state socialist regimes.¹⁷ There is a consensus among researchers that the COMECON had a significant impact on the foreign trade relations of the member states. First of all, it had a strong trade diversion effect, i.e., while trade among the countries of the region increased dramatically, there was a substantial decrease in their trade with Western European and other advanced capitalist countries when compared to their overall foreign trade volume.¹⁸ This in itself meant selective participation in the world economy. There is more debate on the question of whether COMECON increased the total foreign trade turnover of the member states. It has been argued that this organization had a strong trade creation potential—even if it limited trade flows to a relatively narrow group of socialist countries. However, most observers are sceptical on this point too: Franklyn D. Holzman writes of the outright ‘trade-destroying’ effects of socialist economic integration, although these effects diminished considerably by the 1980s.¹⁹ Member states often found it cheaper to produce goods domestically rather than importing them from other COMECON countries because the COMECON prices were largely determined by political negotiations and not by supply and demand.²⁰ Research has placed even more emphasis on the fact that the centralized and bureaucratic coordination mechanisms of COMECON tended to increase the rigidity of the planned economies, thus impeding innovation and the production of high-quality products.²¹

These factors alone resulted in a low level of trade openness in state socialist East Central Europe, even if over time economic reforms—especially in Hungary and Poland—loosened the constraints and gave priority to Western exports, which in turn led to significant shifts in the geographical structure of foreign trade in these two countries as early as the 1970s.²²

After the regime changes, there was a clear turnaround in terms of both de jure and de facto openness. The East Central European countries under consideration successfully implemented all key components of a market economy in a relatively short period of time, including currency convertibility, elimination of state monopoly on foreign trade, and reduction of barriers to international trade. COMECON was abolished, and these countries were quickly integrated into the economic institutions of the West: trade agreements within the WTO were particularly important in this respect, but they also adopted at least some of the economic policies proposed by the IMF and the World Bank.²³ With the break-up of Czechoslovakia in 1992, the year 2004 saw the accession of four new member states into the EU instead of three: the Czech Republic, Slovakia, Poland, and Hungary. EU membership had a profound impact on their trade. The Czech Republic, Slovakia, and Hungary had already experienced an explosion of foreign trade in the mid-1990s; after their accession, their trade openness increased dramatically. In Poland, the extent of the transformation was more limited. The dynamics and the high levels of openness reached after the turn of the millennium in the region are particularly evident when comparing the trade openness of the East Central European countries with the same indicator for Austria (Fig. 2.1).

The regime changes also brought about a complete restructuring of external trade in the four East Central European countries under review.²⁴ The large relative size of their foreign trade with the Eastern European countries began to decline in the 1960s, still, in the mid-1980s, on average, half of their exports went to this group of countries, compared with around a quarter that were directed to the region that later became the EU-15.²⁵ In the case of Poland and Hungary, this shift away from the COMECON area gained new impetus in the mid-1980s, and within just a few years of the regime changes, the structure of foreign trade underwent yet another fundamental transformation. By 1994, the share of Eastern European economies in the exports of the four East Central European countries had fallen to one-third of the previous level on average, showing a significant disparity ranging from 9% to 26%, while the share of the EU member states multiplied, ranging from 60% to 83% (Table 2.1). The importance of COMECON trade thus declined surprisingly rapidly in the region during the early 1990s.

Table 2.1 Trade reorientation in East Central European countries, 1984–1994 (destination of exports, percentage of total exports)

2.2 Capital Movement: Financial Openness and Foreign Indebtedness

In addition to international trade in goods and services, another major focus of attention in the study of economic globalization is financial openness. The more affected a country is by the global flow of capital, the more globalized it can be considered. The various financial movements are linked to other dimensions of globalization in a number of ways: for example, the arrival of multinational companies in a specific country is usually accompanied by capital investment, and their activities increase international trade and generate financial transactions along with information flows. As with trade openness, the literature distinguishes between de facto and de jure aspects of the process.²⁶

Several indicators exist to measure de facto international financial integration. One of them is the Financial Openness Index, which is the ratio of foreign assets and liabilities to gross domestic product expressed as a percentage. Other relevant measures include the ones used in reference to Foreign Direct Investment (FDI) in combination with financial investment.²⁷ These indicators are not available in the longer term for the countries covered in this study. There exist, however, data on the volume of FDI in proportion to the gross domestic product of the East Central European economies.²⁸ This ratio is widely used as an indicator of financial openness in related studies. From the point of view of the country at the receiving end, FDI has the advantage that it does not involve indebtedness and is less volatile than several other types of foreign investment. As capital movement in general, FDI also facilitates globalization in various ways, such as by playing an important role in the diffusion of new technologies and management know-how.²⁹

Compared to trade openness, the evolution of FDI shows similar but even more pronounced trends in East Central Europe in the last third of the twentieth century and into the twenty-first century. In state socialist regimes, the operation of foreign-owned enterprises was incompatible or difficult to reconcile with official ideology and the practices of a centrally controlled economy. As a result, foreign direct investment in the region was almost non-existent until the 1970s and remained extremely low until the late 1980s. The earliest data we have are for Poland: the volume of FDI was 0.01% of the country's GDP in 1975, rising to 0.2% in 1985 and 0.3% in 1989, which was still well below the relative level of FDI attracted by Central and Western European countries, such as Austria in the same years. After 1989, all the East Central European countries studied made a real breakthrough in this area. Hungary led the way, with FDI leaping from 0.6% of the country's GDP in 1989 to 24.3% in 1995, and then to over 60% at the turn of the millennium.³⁰ The Czech Republic and Slovakia followed Hungary with a few years’ delay and achieved similar relative ratios, by then well ahead of Austria. FDI in Poland showed similar dynamics, but at a lower level when expressed as a share of the country's GDP (Fig. 2.2).

Fig. 2.2

Foreign Direct Investment (FDI) stock in East Central European countries and Austria, 1988–2020 (as a percentage of the GDP ) (Sources UNCTAD Stat, various volumes [the author's own calculations]; The External Wealth of Nations Database, Brookings Institute, https://www.brookings.edu/research/the-external-wealth-of-nations-database/, accessed 31 October 2022)

The Chinn-Ito index has been widely used in the research literature to describe the legal and institutional environment determining the financial openness of a specific country, that is, to trace de jure financial openness.³¹ This indicator captures the extent to which capital transactions are regulated, taking into account controls on financial and capital transactions, the existence of dual or multiple exchange rates, and requirements for transferring any export earnings obtained in foreign exchange to government agencies.³²

The index shows strong restrictions on international financial transactions in the East Central European state socialist countries: even in the 1980s, these countries had the lowest rating on a five-point scale. However, this condition changed rapidly in the first half of the 1990s, when the regulatory environment for FDI became much more favourable in all the East Central European countries under review. The Czech Republic and Hungary led the way, with both countries reaching the highest level of the Chinn-Ito index in 2001.³³

This picture of the very limited international financial integration of the East Central European countries is nuanced by the fact that their indebtedness to the West started to grow rapidly from the 1970s onwards.³⁴ The high level of foreign borrowing by several of the COMECON countries was mainly driven by their technological underdevelopment. While the oil crisis of 1973 accelerated technological change in Western economies, the three East Central European COMECON economies were much less able to make such progress. They sought to compensate for the impact of the oil price shock and the deficiencies in technological and economic innovation by borrowing from the West to finance the import of Western products. As Table 2.2 shows, in 1971 the external indebtedness in convertible currency was still small in all the countries of the region under study. In the case of Poland and Hungary, however, the level of indebtedness increased many times over by 1980, only to double again over the following ten years. Foreign borrowing also considerably advanced in Czechoslovakia from the mid-1970s, but per capita debt remained low compared to the other two countries even at the time of the regime change (Table 2.2).³⁵

Table 2.2 Foreign indebtedness of East Central European countries in convertible currency, 1971–1990 (million USD, end of year)

Relying on borrowing from the West, the COMECON countries concerned were not able to carry out the technological modernization that could have enabled them to repay the loans on their own. At the same time, Western loans undeniably enhanced the global relations of these countries by promoting East–West trade; they were partly used to import consumer goods and partly to purchase licences and advanced technologies, but also to establish productive cooperation in which the West generally provided the key components.³⁶ Cooperation with Western firms based on the purchase of licences and under contract work acquired greater economic importance than foreign direct investment in some sectors, especially consumer goods, throughout the region from the 1960s onwards. A well-known example of this type of link in the car industry sector was the production of Polski Fiat passenger vehicles in Poland, which was based on a licence acquired from the Italian car manufacturer Fiat.³⁷

2.3 Information Flow: Telecommunications and Media

The flow of information across borders is a key contributor to the much-discussed phenomenon of time and space compression, a fundamental element of globalization since the nineteenth century.³⁸ What is more, the relative importance of the worldwide exchange of information in the context of globalization as a whole has increased in the twentieth and twenty-first centuries. There are several examples of information spreading ever more widely around the world while other types of flows stagnated or slowed down: this was the case in the 2010s, when the relative size of international trade did not grow as fast as in previous decades, or, according to some measures, it even slightly declined, while the diffusion of information accelerated on a global scale.³⁹

At the same time, information flows are much more difficult to capture empirically than the other aspects of globalization covered so far, as they take place through a myriad of channels, including newspapers, books, letters, telegram service, telephony, radio, television, films, and the Internet, as well as academic conferences, student exchanges, and travel.⁴⁰ As a result, the study of the international diffusion of information can only be very selective; specific areas must be designated that are considered to be important as well as characteristic of the process as a whole. In the research literature, these proxy indicators include, for example, the volume of international mail service and air traffic, the number of international telephone calls, the volume of book exports and imports, the number of internationally protected patents, the degree of freedom of the press and, more recently, the volume of Internet traffic, or some combinations of these.⁴¹

Against this background, the following section of the chapter considers two main areas of information flow: telecommunications on the one hand, and the print and electronic press on the other. In both cases, the specific aspects selected are not only relevant in themselves, but, arguably, they also indicate the approximate changes in other areas of communication and media that are difficult to study or for which there are insufficient data available.

In telecommunications, information flow is explored by applying a network analysis based on the relations among the system's elements rather than the characteristics of individual cases in order to identify structures in the global telecommunications system. The positions of the East Central European state socialist countries in the global information space will be determined in terms of the frequency of communication between nations via telecommunication channels, and the study considers how the positions of these countries evolved after the regime changes. The analysis exploits international telephone call data, which have been used as an important indicator in a number of studies and composite indices measuring the level of globalization.⁴² A major argument in favour of an inquiry into telephone calls is that phone calls were a fundamental form of cross-border communication in the decades before the regime changes in East Central Europe and beyond, and remained so throughout the 1990s. Other means of long-distance communication, such as telegraphy and postal mail, either had already lost their importance or, like the Internet, only became common during the second half of the 1990s, making a long-term study unfeasible.

The data come primarily from the studies by George A. Barnett, Joseph G. Salisbury, and Su-Lien Sun, but other research results are also included.⁴³ The positions that countries occupy in the international telecommunications network and the relations among those countries are defined by these authors in terms of two dimensions, the volume and the direction of communication, and are characterized by the patterns of connectedness, centrality, and integrativeness. This study focuses on the evolution of centrality, which can be regarded as the most comprehensive of the network descriptors mentioned. Centrality is defined as the average number of links needed to reach all other nodes in the group, which in this case are all the countries included in the study. Thus, the lower this value, the more central the position a specific node—i.e., a specific country—occupies in the network. For better comparability, it is best to use a standardized score to measure the centrality of each node (Fig. 2.3).⁴⁴

Fig. 2.3

Positions of selected countries in the global telecommunications network based on international phone traffic, 1982–1996 [centrality measured by standardized distance] (Note Centrality in the network based on standard distance. Centrality is the average number of links in a telecommunications network that are needed to reach all other nodes, i.e., countries. For better comparability, centrality is measured using the standardized value of the country indicator. Thus, the lower the value, the more central the country is in the network. Sources Su-Lien Sun and George A. Barnett. “The International Telephone Network and Democratization,” Journal of the American Society of Information Science 45, no. 6 [1994]: 411–421; George A. Barnett and Joseph G. T. Salisbury. “Communication and Globalization: A Longitudinal Analysis of the International Telecommunication Network,” Journal of World-Systems Research 2, no. 1 [1996]: 479–505; George Barnett, “A Longitudinal Analysis of the International Telecommunication Network, 1978–1996,” American Behavioral Scientist 44, no. 10 [2001]: 1651–1652)

For the East Central European countries under study, data are available for the period 1982–1996, which also allows us to assess the impact of the regime changes on international telecommunication traffic. In this period, worldwide information exchange increased steadily; the international telecommunications network became denser, more tightly connected, and the system itself became more highly centralized and integrated. All of this represents a significant advance in globalization.⁴⁵

During the 1980s, the structure of the global telecommunications network remained fairly stable: no discernible changes occurred in the distribution of countries occupying central, peripheral, or intermediary positions. Industrialized nations of the West, including the United States, Canada, and Western European countries such as the United Kingdom, Germany, France, Italy, Switzerland, and the Netherlands were the most central in the global telecommunications network throughout this decade. The periphery was made up of Third World and Eastern Bloc societies. Between these two groups, some European nations and several Asian countries with rapidly developing economies occupied intermediate positions. While during this decade the ‘Asian Tigers’ and the Latin American countries moved slightly closer to the centre of the global network, no change was seen in the case of the European state socialist countries.⁴⁶

After 1989, however, a significant shift occurred in the positions occupied by the East Central European countries under study. Within just a few years, they markedly converged to the centre of the international telecommunications network. A comparison with Austria demonstrates this dynamic: while Austria was much closer to the centre of the network than the East Central European countries in the 1980s, its advantage quickly evaporated after the regime changes. Meanwhile, the East Central European countries were also converging among themselves: Hungary and Czechoslovakia—as well as its successor states—caught up with Poland, which up until then had been the most globally integrated country within the group as far as telecommunications were concerned. In parallel, the ‘Asian Tigers’ and several Latin American nations drifted towards the periphery, i.e., their relatively favourable location in the network was taken over by the new democracies of East Central Europe, which had by then established more extensive communications links with the other countries (Fig. 2.3).⁴⁷

These results were confirmed by employing other methods of network analysis to avoid method bias. Besides the positional or link analysis outlined above, the relations among countries were examined with multidimensional scaling and cluster analysis. These studies also demonstrate that after the regime changes, the East Central European countries moved closer to the countries occupying central positions, while also forming a separate group of their own in the meantime. By the 1990s, Austria was just another member of the same group.⁴⁸

It is also noteworthy that in the 1980s, the country generating the highest telephone traffic with East Central European state socialist countries was a Western European country, the Federal Republic of Germany, and not the Soviet Union, which was central to their economic relations and political alliance, yet it appeared much lower down the list.⁴⁹ With the well-known political and economic reorientation after 1989, this pattern became even stronger. It is also evident that the foreign telecommunications traffic of the East Central European countries was always concentrated on Western Europe in this period, while only a small fraction of the total volume of calls was either initiated to or from Third World countries or, in general, overseas.⁵⁰

As a result of this process, the biggest change in the entire global telecommunications network seen in the 1980s and 1990s occurred in the positions of the East Central European states.⁵¹ While, in general, a country's position in this network strongly correlates with its level of economic development, this was not found to be the case for the East Central European countries. In the 1980s, their relative economic development lagged behind their positions in the network in terms of centrality, but after the regime changes, despite a temporary but strong decline in their economic performance because of the transformation crisis, they moved significantly closer to the centre of the network. This shift demonstrates the importance of political transformation in the process of East Central European globalization.⁵² On the other hand, it also illustrates the more general point that globalization not only evolves unevenly, but it often proceeds by leaps and bounds.

As has already been pointed out, the analysis of telecommunications networks cannot provide full insight into the global information flows. Further pieces of research have revealed that other global networks, in particular international financial and trade information systems, exhibited characteristics very similar to those of the telecommunications networks in the 1980s and 1990s: basically the same countries belonged to their respective core, periphery, and semiperiphery, and their dynamics of change was also comparable.⁵³ In accordance with these results, other research revealed a similar structure for the global telecommunications and transportation networks with regard to linkage and centrality.⁵⁴ These outcomes certainly make the arguments presented above more robust, but the study of other areas of information flows can shed further light on their validity. Thus, in what follows, the results will be complemented by observations concerning print and the electronic press.

Print media and television were among the most important transmitters of information worldwide in the second half of the twentieth century, with very different temporal dynamics. Their role in international information exchange is, however, less well documented and understood than that of telecommunications. Taking into consideration the availability of sources, we will examine the patterns of news coverage in the press, the origin of feature films screened, and the structure of television programmes in order to glean insights about how they connected East Central European societies to the global flow of information and cultural products.

During the state socialist period in East Central Europe, the direct political control of the print and electronic press, for obvious reasons, had a significant influence on the content of the information disseminated by the press. The survey of news coverage in the most prominent dailies also reveals notable differences in the structure of the various news categories featured in the newspapers of the region as compared to those of other European regions. In 1970, in Czechoslovakia and Hungary, a relatively large share of the news published in dailies was devoted to foreign policy issues. What is striking is that in addition to the high proportion of coverage focusing on the East Central European region, Europe as a whole was also prominently represented, with an average of 58% of the foreign news covering the European continent. Meanwhile, news about the Soviet Union accounted for a very low proportion (1.4%). In the Western European—British and German—newspapers surveyed, the share of news about Europe was 42% of the international pieces, the rest being about the other continents.⁵⁵

Of note for the research questions examined here is the relatively limited coverage of the Third World in East Central European newspapers during this period. For example, Africa appeared in 2.1% of the international news in the surveyed newspapers, compared to 3.1% in their Western European counterparts. Latin America, on the other hand, featured much more in dailies in both parts of the continent, accounting for 14.2% and 14.5% of the foreign news in the East and West, respectively.⁵⁶ In the following years, the differences between the western press and its East Central European counterpart gradually faded: in 1979, Polish and Hungarian daily newspapers and radio and television broadcasts continued to give high prominence to news reports from their own continent, but by then the gaps had closed between them and the media outlets of the Western European countries in terms of the news structure observed.⁵⁷

The composition of feature films screened in the state socialist countries of East Central Europe clearly demonstrates the moderate extent and selectivity of cultural globalization in the region. In 1970, in Western and Southern European countries—as in many other parts of the world—the market was dominated by American feature films: even in Italy, with its advanced film industry, the market share of American movies was over 50%. In Poland and Hungary, on the other hand, the proportion of American productions ranged between 10% and 20%, with French, Italian, British, and German movies also representing a relatively small fraction, as domestically produced films and imports from the state socialist countries made up the bulk of the releases.⁵⁸ This pattern only slightly changed over the following decade, with American pieces accounting for 24% of the feature films shown in Hungary in 1985, compared to 12% in Czechoslovakia and 9% in Poland. It is also noteworthy that, while some Western European countries were already showing movies shot in India, Hong Kong, and other non-Western countries in both cinemas and on television screens during the 1970s and 1980s, East Central European distributors showed little interest in such productions.⁵⁹

Television, an emerging medium since the 1950s, gradually became the most important disseminator of information about the transnational world—often in defiance of the preferences of the political leadership—for the widest sections of the population in state socialist East Central Europe. As a result, it had stronger globalization effects than any other information channel in the region. This process was facilitated by the spread of television sets, which itself followed international patterns and was particularly rapid in the 1960s and 1970s: in Poland, for example, there were only 14 licences per 1,000 inhabitants in 1960, which increased to 66 by 1965 and 129 by 1970; by the second half of the 1970s, most households owned a set.⁶⁰

Until the 1980s, television broadcasting in Europe was strongly demarcated by national boundaries. Public televisions, regulated by national authorities, predominated, without much ambition to broadcast beyond their home countries’ borders. In fact, due to the technological limitations of terrestrial transmission and language barriers, cross-border broadcasting had only a limited audience in the European state socialist countries—with the notable exception of the GDR and the Western parts of Yugoslavia, Hungary, and Czechoslovakia, where watching West German, Austrian, or Italian channels was relatively common.⁶¹ Already in the first decades of television history, programmes in all three countries under study featured similar genres to those on public television in Western Europe, i.e., mainly feature films and news, along with educational, sports, entertainment, and children's programmes.⁶²

Television editorial offices, like newspapers, were under political control, although the severity of the supervision varied by periods and by countries. For example, in Czechoslovakia, censorship was abolished in 1968, only to be reinstated after the Prague Spring was crushed later in the same year. In Hungary, there was no such clear break, but oversight was gradually relaxed and the authorities became more permissive from the late 1960s on.⁶³ In the countries of the region, domestic and Eastern Bloc-produced programmes were carefully prioritized, if only because of the unavailability of funds in hard currencies for the acquisition of foreign shows. While a significant share of total programme imports in Poland and Hungary came from Western Europe throughout the 1970s and 1980s, the most striking feature in international comparison was the weak representation of American productions.⁶⁴

Thus, there is no doubt that within these countries, there were serious limitations to television conveying any of the prominent values and attitudes that were spreading globally at the time. This was partly because such orientations were often associated with Americanization, a trend that the state socialist regimes actively sought to inhibit. For instance, television played a lesser role in disseminating consumer culture in the region compared to many other parts of the world, as advertising on East Central European television was significantly more subdued than on American or Western European channels.

Notwithstanding, the impact of television and cinema in this respect should certainly not be underestimated. Programme makers everywhere in Eastern Europe were aware that the audience had a strong demand for Western entertainment.⁶⁵ Both Western films and TV series, which slowly made their way not only to Yugoslavia but also to other Eastern European countries such as, most prominently, Hungary and Poland, and the news coverage of global events shown on TV screen in these countries were also important sources of information about consumer societies: fashionable clothes, streamlined cars, rich interiors, supermarkets, and colourful streets, even if only in a crime movie or a comedy, were all part and parcel of the content. From the 1970s onwards, this sort of information reached virtually all social classes in East Central Europe, mainly through television, and made them aware of the differences between their own way of life and that of Western consumers.⁶⁶ The impact of television, however, went beyond consumer culture: despite the selective nature of the information provided and the typical political biases and distortions of the programmes, the spread of television enabled broad sections of these societies to become regularly and experientially informed—for the first time in history—about political and sporting events taking place in distant parts of the world, as well as about cultural and economic news from those regions.

After 1989, the print press, as well as film distribution and television broadcasting, underwent a fundamental transformation in East Central Europe. Alongside democratization and commercialization, advances in technology and transnationalization were the main drivers of change. In addition to the disappearance of political control and the emergence of market conditions, the media was also subject to rapid technological change, which was facilitated by the unfolding innovations of what is known as ‘the third communications revolution’ or ‘the digital revolution’ taking place across the globe during this period.⁶⁷ As a result, all over East Central Europe the spread of satellite and cable television also made dozens of channels available to a significant proportion of households within just a few years. Transnationalization affected not only the ownership structure of the press, but also the prevailing forms of media and the content they conveyed. Western influence was strongly felt in the print press, but was particularly noticeable in television and cinematic productions.⁶⁸ The selection of programmes increased, but programming also saw a sharp rise in the share of foreign content, along with a decline in productions from East Central Europe, and the virtual disappearance of programmes from the successor states of the Soviet Union, while American series and other shows assumed a dominant position. As a result, the share of imports from Western Europe also fell, but the total number of broadcasting hours dedicated to programmes from these countries actually grew because of the boom in total transmission time and the rise in the share of imports. Over time, Brazilian, Argentinean, and Mexican series, particularly soap operas, also appeared and accounted for a significant proportion of programmes.⁶⁹ More than ever, television became a tool of cultural globalization in East Central Europe; in this respect, its impact was only surpassed by the Internet after the turn of the millennium.

2.4 The Movement of People: Travel and Migration

As the fourth dimension of globalization, the dynamics of crossing national borders by people are explored. Four main types of flows will be considered: tourism, migration, labour migration (temporary employment abroad), and the international mobility of students. These movements are not equally important in the context of globalization: student exchanges do not usually affect the population of a country as widely as tourism; similarly, emigration exerts less of a globalizing effect on a society than immigration into the country concerned.

The movement of citizens across borders is a particular aspect of globalization, because in the second half of the twentieth century and beyond it was much more heavily regulated and constrained by governments than, for example, the foreign trade of goods. The dynamics of the flow of people were therefore even more affected by political changes than those of the other three arenas of globalization under study. The research literature looks extensively at these political factors and distinguishes between several types of border regimes, of which the three countries under study belonged to the so-called Eastern border regime after the communist takeover.⁷⁰ This meant, above all, rigid entry and exit regulations, restrictive practices in the issuance of passports and visas, a comprehensive system of border surveillance, severe penalties for illegal border crossing, and a wide range of prohibitive customs duties and procedures.⁷¹ The basic characteristics of the Eastern model persisted until 1989, but a certain liberalization in this respect had already begun in the mid-1950s, and in the 1960s a more moderate form of the Eastern border regime emerged in the region. At the same time, after the late 1960s, the East Central European countries diverged in terms of the openness of their borders.⁷² The changes in the border regime had a profound impact on both tourism and migration.

As in many regions across the world, mass tourism in the state socialist countries of East Central Europe emerged after World War II, mainly in the form of domestic travel; foreign visits remained much more limited.⁷³ In the 1950s, even travel to other Eastern Bloc countries was a privilege in these societies. In the following decade, the restrictions on visits to the state socialist countries were significantly relaxed, leading to a substantial growth of tourism among the three East Central European countries under study as well as other European state socialist countries by the 1970s.

From the mid-1960s onwards, Polish and Hungarian passport policies also became more permissive concerning travel to the West. Hungarian citizens were initially allowed to travel to the West once every three years; then in 1982, it increased to once a year. In Poland, the practice of issuing passports permitting travel to the West was significantly relaxed in 1987, while in Hungary a new passport introduced in 1988 allowed the holder to leave the country freely.⁷⁴ However, the amount of foreign currency, particularly hard currency, that could be legally purchased was always severely restricted in both countries even if those citizens who had saved money abroad, received bank transfers from relatives or acquaintances living abroad, or had otherwise legally acquired funds in foreign currencies were allowed to deposit them in special accounts for use when travelling abroad.⁷⁵

Czechoslovakia was an example of a stricter border regime in much of the state socialist period. The 1965 passport law maintained the requirement for an exit permit to visit the West, even though from that point on applications were treated somewhat more leniently.⁷⁶ In 1968, the introduction of new, more liberal regulations was already in the pipeline, but the idea was shelved after the military intervention of the Warsaw Pact. In 1969, travel to the West became almost impossible, except for visits to relatives living legally in the West—which required an invitation letter and endorsement from the authorities—and organized tourist trips. While individual travel to the West was not formally banned, the police would generally not allow it. Visits to neighbouring socialist countries were much easier to realize. However, in 1981, authorities implemented travel restrictions concerning Poland in response to the political events unfolding there. As a prelude to the regime change, from 1988 onwards, exit permits were generally granted permitting travel to the West without any difficulties, but currency restrictions remained in place.

Citizens of the three East Central European countries under study therefore mainly visited the neighbouring state socialist countries, and most of these visits could be categorized as shopping tourism.⁷⁷ The proportion of trips to countries outside Europe, including the Third World, was particularly low. This is illustrated quite clearly by the case of Hungary. In 1958, even if we take all the continents into account, only a few thousand trips were made outside Europe by Hungarian citizens. While this number increased in the following decades, even as late as the 1980s, merely a few tens of thousands of overseas trips were recorded in the statistics (Fig. 2.4). A significant proportion of these travellers were not tourists but individuals on diplomatic missions or on business for their companies. It is also worth noting that although Hungarians visited Asia more frequently than any other continent, the dominant country of destination was Turkey, and the majority of these visits consisted of short shopping trips to Istanbul where items such as jewellery and fur were relatively inexpensive.

Fig. 2.4

(Source KSH. Statisztikai Évkönyv. Budapest: KSH, various volumes [the author's own calculations])

Non-European destinations of travellers from Hungary, 1958–2005 (annual number of outbound visitors)

Migration has a long tradition in East Central Europe. However, since the mid-nineteenth century, East-to-West population movements have dominated in the region.⁷⁸ While the Cold War and the Iron Curtain significantly reduced migration, it certainly did not stop it. Between 1950 and the regime changes, ethnic migration, typically facilitated by intergovernmental agreements, comprised approximately three-quarters of East-to-West migration. The largest group, numbering around 1,430,000 ethnic Germans, migrated westwards between 1950 and 1993 as a result of an agreement between Poland and the Federal Republic of Germany that aimed for ethnic homogenization. Refugees constituted another large group with some 606,000 persons.⁷⁹ Most of them left their homes in waves following political crises, availing themselves of the opportunity whenever the borders were briefly opened. These waves of refugees include those fleeing during or in the aftermath of the dramatic events in Hungary in 1956, Czechoslovakia in 1968, and Poland in 1980/1981. In addition, despite the strict border regime, illegal migration persisted throughout. These population movements were one-directional, as there was hardly any immigration to the East Central European countries during the Cold War. While the aforementioned administrative hurdles for crossing the borders were certainly one of the reasons for this asymmetrical situation, the state socialist countries were also not seen as attractive destinations from either a political or an economic point of view. Thus, migration in this region, and in Eastern Europe in general, was much less likely to mediate globalizing effects in the post-war decades than was the case for most Western or Southern European societies.

Labour migration—or temporary migration of workers—presents a similar picture. As far as inward labour migration is concerned, while the German Democratic Republic (GDR) offered employment to relatively large numbers of people from non-European, mostly communist or socialist-oriented countries such as Cuba, Vietnam, Angola, and Mozambique, this was less common in the East Central European countries under study. The dynamics of inward labour migration certainly accelerated in the mid-1960s. Czechoslovakia took the lead: the first wave of Vietnamese workers arrived in 1967, their headcount reaching a total of 2400 over the years. They were followed by a contingent of 5500 persons in 1974. Finally, the third wave, which started in 1980, saw around 50,000 Vietnamese workers finding shorter or longer employment in Czechoslovak factories within a decade.⁸⁰ Between 1978 and 1979, 23,160 Cubans were also employed in Czechoslovakia.⁸¹ In 1980, Hungary followed suit by signing an agreement with Cuba for hosting approximately 3000, mostly female, textile workers from the Caribbean country during the next few years. They typically received a short vocational training and then participated in a three-and-a half year apprenticeship as skilled workers. In terms of its structure, the programme resembled similar exchange schemes in other East Central European state socialist countries.⁸² As the above figures reflect, labour migration into the East Central European countries remained limited, especially by West European standards, and had only a modest impact on the labour markets and the societies of the region.

Full employment featured prominently in the official ideology of the state socialist countries, but it was first of all the labour shortage generated by the process of forced growth that contributed to the realization of these goals.⁸³ As a consequence, while it is certainly true that, with the sole exception of Yugoslavia, employment abroad was held back by administrative means, a key push factor behind seeking work abroad was also missing. Thus, while foreign employment was not entirely unknown in the three East Central European countries covered in this study, it was very restricted in scale, almost entirely confined to the countries of the COMECON, and was usually based on intergovernmental agreements of limited duration. For example, the 1967 arrangement between Hungary and the GDR resulted in a total of about 30,000–50,000 Hungarian employees finding jobs in the East German industry and service sector over the next decade and a half, with a few thousand East Germans participating in the organized exchange. In much the same way, several tens of thousands of Polish workers, mainly women, were employed in Czechoslovak industry in the 1970s and 1980s.⁸⁴ In the same decades, a few thousand Polish coal miners were hired in Hungary.

Working in the Soviet Union was an often hard experience for the East Central European employees, as the work had to be done at a great distance from home, often in very harsh conditions, and usually in a colony-like manner. Poland, Czechoslovakia, Hungary, and several other state socialist countries undertook the implementation of major development projects in the energy sector across the Soviet Union including, for example, the construction of a 2750 km gas pipeline from Orenburg to the Soviet Union's western border, along with the commencement of oil production in Tengiz. These projects involved thousands of employees over a period of several years.⁸⁵

In addition, East Central European companies were also active in the Third World.⁸⁶ The labour migration that started as a result of the latter affected only a limited number of sectors, particularly construction. As an indication of the size of labour migration, in 1980 a total of 62,000 Polish workers were employed abroad, accounting for less than half a per cent of the active population of the country.⁸⁷ This cannot be considered insignificant, but it certainly does not justify the claim about “the robustness of mobility within the state socialist camp”.⁸⁸

For the assessment of international student migration in the East Central European region, we rely on a methodology of network analysis similar to the one we used to study information flows. The results show that in the mid- to late 1980s, the countries of East Central Europe occupied central positions in the global student exchange network in terms of hosting foreign students. While in terms of centrality, the United States, Canada, Japan, the Western European states, as well as some other Asian countries such as China and India were ahead of the East Central European countries, the latter still enjoyed better positions within the network than, for example, Norway, Spain, Portugal, South Korea, or Argentina.⁸⁹ Therefore, East Central Europe was more globalized in this respect than in the other aspects considered so far. However, as already indicated, this finding is based on the number and origin of incoming students.⁹⁰ In view of outward student mobility, the East Central European societies were in a much less central position, as their students had hardly any access to universities and other educational institutions outside the Eastern Bloc until the late 1980s.

Notwithstanding the earlier liberalization trends in Hungary and Poland, the real breakthrough in respect to border crossing for the whole of East Central Europe was brought about by the fall of state socialism. So much so that for many contemporaries, the opening of the borders was the single greatest achievement of the regime changes. Tourism even played a direct role in the collapse of state socialism; when Hungary lifted its strict border controls with Austria in the summer of 1989, East German tourists flooded Hungary's western neighbour without a permit from the authorities of their home country. This development triggered a domino effect in the GDR, contributing significantly to the disintegration of the East German state.

In the new East Central European democracies, citizens were not only able to obtain passports without prior authorization but could also cross the border in all directions, all the more so because the Western European countries and many others around the world had lifted visa requirements for travellers from these states.⁹¹ This also happened in the opposite direction, even though citizens of Western countries had been able to visit the region with relatively little hassle since the 1960s.⁹² At the same time, arrangements easing travel between the former state socialist countries were also maintained, allowing citizens of a number of countries, including successor states of the Soviet Union, unrestrained passage through the borders of the East Central European countries although their freedom to travel on to Western Europe was more limited because of visa regulations. The region thus became a unique zone of travel and migration in the 1990s, open to a large number of people from both Eastern and Western countries.⁹³

The late 1980s and early 1990s saw a huge increase in the number of border crossings in East Central Europe; masses of people began to travel from East to West and from West to East for shopping, visiting relatives, tourism, or employment.⁹⁴ In Poland, entries and exits amounted to 19 million in 1985, rising to 84 million in 1990, and 262 million in 1996.⁹⁵ A similar development was observed in the Czech Republic, while Hungary and Slovakia each recorded around 100 million border crossings annually in the mid-1990s. Most border crossers were classified as tourists although this designation continued to cover many activities that had little to do with visiting cultural landmarks or natural tourist attractions. Many travelled abroad several times a month for shopping or conducting small-scale trade.⁹⁶ However, genuine tourism and visits beyond the immediate region were also on the rise. The growing global openness is exemplified by the significant increase in travel beyond Europe. Taking the earlier Hungarian example, around the turn of the millennium, up to ten times as many Hungarians could gain first-hand experience of life in Africa and the Americas compared to the years preceding the regime change (Fig. 2.4).

As a consequence of the fall of the Iron Curtain and the transformation crisis following the collapse of the centrally controlled economies that generated mass unemployment, the nature of permanent migration as well as that of labour migration fundamentally changed across East Central Europe. On the one hand, both types of outward migration flow significantly increased; on the other, immigration into the East Central European region, which had been negligible before, reached significant proportions. Having said that, methodological difficulties complicate the accurate assessment of the processes. In this period, it is much more complicated, if not entirely impossible, to distinguish between the temporary migration of labour on the one hand and migration that can be considered permanent on the other because administrative hurdles preventing people from returning home or engaging in circular migration were either no longer present or had became much less significant in the region and, overall, across Europe.

The dominant direction of migration remained East–West and the number of those leaving increased.⁹⁷ However, the dynamics of emigration was far from being constant over time. This type of population movement accelerated in the first few years after the change of regime, then slowed down for a while with yet another uptick in the number of people leaving the region after EU accession, the latter mainly affecting Poland.⁹⁸ In addition, the structure of emigration also became more complex. On the one hand, ethnic emigration, which used to dominate, lost much of its importance from the mid-1990s, as the size of ethnic minorities clearly had declined in East Central Europe by this time, and economic motives now clearly dominated the causes for expatriation. On the other hand, circular migration, also known as temporary or incomplete emigration, became a significant form of movement.⁹⁹ While until 1989 labour migration was essentially confined to the COMECON area, after the regime changes, the former member states of the COMECON were almost completely excluded as the labour force from East Central Europe flowed towards Western Europe.

Immigration, previously almost non-existent, also became noticeable in the region, with a significant influx of people from outside the continent, in line with general European trends. Foreigners now made up a significant proportion of the residents of some large cities: in 1995, 9–11% of the inhabitants of Prague and 4–6% of Budapest were estimated to be foreign nationals. This group partly consisted of employees of Western companies and international institutions, but Asian immigrants also accounted for a substantial proportion, clearly transmitting powerful global influences through activities like introducing their cuisine and conducting foreign trade.¹⁰⁰ The post-1989 influx of illegal immigrants into East Central Europe was also unprecedented. In the mid-1990s, estimates suggested 200,000 illegal immigrants in the Czech Republic and between 40,000 and 150,000 in Hungary.¹⁰¹

The barriers to immigration are also clearly visible: as East Central Europe had little economic and cultural appeal for refugees, the region was mainly seen as a transit point, and refugee numbers remained low compared to Western and Southern European countries. Longer-term trends in immigration are illustrated by the fact that the share of immigrants in the population increased from 4.1% to 4.4% in the Czech Republic, from 0.8% to 2.4% in Slovakia, and from 3.4% to 3.7% in Hungary between 1990 and 2010, while it decreased from 3% to 2.2% in Poland. Meanwhile, in Austria, for example, the already much higher rate of 10.3% rose to 15.6% during the same period.¹⁰² The ratio of foreign-born individuals to the total population also shows a similar picture, remaining relatively low in the region.¹⁰³ Moreover, these figures include ethnic minorities, typically nationals of neighbouring countries, repatriated by the nation states where their own ethnic group constituted the majority. All four countries under study have diasporas, which accounted for a large share of the people seeking to settle. For example, 70–80% of foreign nationals permanently settled in Hungary between 1989 and 1998 were ethnic Hungarians from Romania, but the Czech Republic and Slovakia had a similarly high proportion of ethnic Czechs and Slovaks among their own immigrants (Fig. 2.5).¹⁰⁴

Fig. 2.5

Estimated refugee stock (including asylum seekers) in selected European countries, 1990–2019 (mid-year, percentage of population) (Note Estimated data; also includes asylum seekers; Hungary: 1989. Sources UN DESA Databases, https://www.un.org/development/desa/pd/content/international-migrant-stock, accessed 12 March 2022; World Bank, https://data.worldbank.org/indicator/SM.POP.REFG, accessed 12 March 2022)

The position of East Central European countries in the international student exchange network changed little after the regime changes. Although the number of their connections slightly increased, which certainly reflected a higher degree of globalization in their educational systems, this was a trend observed in many countries worldwide; as a result, the centrality of the East Central European countries in the global education network did not show any major change in the 1990s.¹⁰⁵ On the other hand, there was a large increase in the number of outgoing students, who were now able to enrol in universities in the Western world.¹⁰⁶

The above survey of the changes that occurred in important areas of globalization during the state socialist period and in the aftermath of the regime changes in East Central Europe provides an opportunity to draw some conclusions about the nature of the process. In the following chapters, we will first discuss two key issues that have been the subject of distinctive and divergent interpretations in the recent literature: the conceptualization of state socialist globalization in East Central Europe and the impact of the regime changes on the globalization process in the region.