Abstract
On the grounds of borrowing and reforming Hirschman’s terminology, ‘exit, voice, loyalty’, we show both a conceptual and a methodological framework that can be used to raise questions in transitology studies. These issues include the following points: are there any models being developed concerning the transition countries?; are there any similar models in Western Europe?; is there any convergence between the models of both Eastern and Western Europe? If the answer to the last issue is yes, then in which areas? Or if it is a no, is it true that a special economic, social and also political system is developing in Eastern Europe? Another issue concerns how strong the growth potential of the different models is. It also examines which are the successful models and which are not, and what is the role of the economic and political elite in the development of these models. This study includes only the theoretical framework.
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Notes
The discussion about the border between Western and Eastern Europe and also about the reality of Central Europe has a history of some centuries—see, e.g. Beluszky (1995), Carter (1996). The definition of Eastern Europe is related in this analysis to every post-socialist state as with this distinction we want to express the different development paths between the western and eastern parts of Europe and want to emphasize that there is a kind of similarity among the states which are located in the eastern part of Europe regarding both history, economic structure, social framework and political system. Concerning this separation and definition we are following Wallerstein’s (1979) centre-periphery separation.
See for example the history of Washington Consensus.
Many economists do not fear to throw economic theories and lessons easily into the dustbin if they do not work or help in some real economic situation. Although it could be accepted, they could be relevant in other circumstances. The more important question is that should we require from every theory that they should always be relevant? We are on the opinion that this is a bad requirement as if we would always need this from all of the theories, science would be similar to such a race that loses its genetic diversity and its ability to survive in other circumstances.
Hirschman’s book titled Exit, voice, and loyalty had the aim to reveal the adaptability of tools and concepts from other social sciences into economics.
The relevance of Solow’s model has been confirmed in long run by many, see for example Sala-i-Martin (1996).
We consider institutions the economic and political rules, which mark out the framework of social life. They are the regulators of social relations and networks, as Gros and Suhrcke (2000) say institutions are the “software” of social contacts. Accordingly, the laws on parliamentary elections, media laws, property laws, the market, the taxes, the independence of central banks, the trade unions, etc. belong to the institutions. There are two groups of institutions. The first group contains institutions which are developing in a natural, evolutionary way, accepted by the majority of the society. They are developing long term with a trial and error method and bottom-up direction and are not necessarily written down. The second group’s institutions are formed by written rules in a top-down direction, which is faster and unnatural. Their acceptance by the majority of society is not necessary, but society has to follow them because they are secured by law and enforcement.
The third dimension mentioned by Offe (1991) is not necessary in this study.
It can be thought at first sight that we assume that leaving the labour market is voluntary, i.e. the workers decide to leave their jobs by themselves. On the contrary, we see it from the other aspect, and we suppose that the unemployed and inactive ex-workers are people who do not want to go back to labour market.
The model can be expanded later with the other two dimensions (politicians and managers), because the politicians make the institutional reforms (if there is any reform) since in Eastern Europe the top-down institution building is typical because of the fast collapse of socialist system, and the market of managers influences what kind of entrepreneurs are working in the market.
For example any of the capital market structures can be put together with any of the labour market structures, and there are three capital and three labour markets. Subsequently, we can make a matrix with nine cells.
For example if the number and intensity of strikes is growing from one year to the next year, or the number of unemployed persons is rising within a year.
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Acknowledgments
We thank Péter Gedeon, Thomas Kloster-Jensen Macintyre, Erzsébet Kovács, Szabolcs Szajp, Balázs Pálvölgyi, Barbara Lovas and András Sugár for their very helpful comments and suggestions. The usual disclaimers apply.
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Szabó, Z. Exit, Voice, Loyalty in Transition: A Theoretical Framework. Transit Stud Rev 15, 650–659 (2009). https://doi.org/10.1007/s11300-008-0035-0
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DOI: https://doi.org/10.1007/s11300-008-0035-0