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Abstract:
This paper explores interactions between growth, economic liberalization and democratization during transition. The results can be summarized as follows: (1) Liberalization has a strong positive effect on growth during transition (also when controlling for endogeneity of liberalization in growth). (2) Democracy facilitates economic liberalization. (3) Because of its effect on liberalization, democracy has a positive overall effect on growth. Nevertheless, the marginal effect of democracy (after controlling for progress in economic liberalization) is negative during early transition. (4) The progress in democratization in turn depends on past economic performance in a surprising manner-the relationship between past growth and subsequent democracy appears negative. (5) Economic performance is an important determinant of electoral outcomes and, in particular, of support for reforms.

Democracy, liberalization, economic performance, elections

Abstract:
This Paper explores interactions between growth, economic liberalization and democratization during transition. The results can be summarized as follows: (1) Liberalization has a strong positive effect on growth during transition. This holds also when controlling for possible endogeneity of liberalization in growth. (2) Democracy encourages liberalization-countries which introduced greater democracy subsequently progress further in economic liberalization too. (3) Because of its reinforcing effect on liberalization, democracy has a positive overall impact on growth. Nevertheless, the marginal effect of democracy (after controlling for progress in economic liberalization) is negative during early transition. (4) The progress in democratization in turn depends on past economic performance in a surprising manner-the relationship between past growth and subsequent democracy appears negative. (5) Economic performance is an important determinant of electoral outcomes and, in particular, of support for reforms.

Democracy, economic performance, elections, liberalization

Abstract:
I perform an empirical analysis of the relationship between economics and politics in the countries in transition. I use regional results of national elections in the Czech Republic, Hungary, Poland and Slovakia to link variations in support for reforms with the economic effects of reforms across regions. I show that support for reform is endogenous--the reform engenders constituencies that support or oppose it. In particular, high unemployment decreases support for parties associated with the reform and increases support for left-wing parties. The emerging private sector in general increases support for reform and reduces support for the communists and extreme left. This general pattern holds both within countries and across countries. The electoral failures of pro-reform parties in some transition countries can then be explained by imbalance between constituencies supporting and opposing radical economic reform.

Abstract:
I analyze the relationship between economics and politics across eight parliamentary elections in four transition countries, the Czech Republic, Hungary, Poland and Slovakia, using regional data (election results and socio-economic characteristics at county level). I argue that support for reform reflects the balance between positive and negative effects of the reform. Accordingly, I identify economic groups that support or oppose the reform. The former are private entrepreneurs, white collar workers and university educated voters. The latter are the unemployed, retirees, and blue collar and agricultural workers. This general pattern holds both within countries and across countries, and across tenures of different governments. An intriguing result of my analysis is that the voters in the transition countries are found to be forward looking rather than retrospective. They cast their votes for the party, which they expect to maximize their future utility, based on the perceived stance of that party toward further reforms. Accordingly, the winners of reform vote for the pro-reform, right wing parties, whereas the losers of reform support the left wing parties, regardless of which party is currently in the government. This stands in contrast with the result typically obtained for the developed countries-the so-called responsibility hypothesis-that voters are retrospective and punish the government for bad economic performance.

Abstract:
I analyze the relationship between economics and politics across eight parliamentary elections in four transition countries, the Czech Republic, Hungary, Poland and Slovakia, using regional data (election results and socio-economic characteristics at county level). I argue that support for reform reflects the balance between positive and negative effects of the reform. Accordingly, I identify economic groups that support or oppose the reform. The former are private entrepreneurs, white collar workers and university educated voters. The latter are the unemployed, retirees, and blue collar and agricultural workers. This general pattern holds both within countries and across countries, and across tenures of different governments. An intriguing result of my analysis is that the voters in the transition countries are found to be forward looking rather than retrospective. They cast their votes for the party, which they expect to maximize their future utility, based on the perceived stance of that party toward further reforms. Accordingly, the winners of reform vote for the pro-reform, right wing parties, whereas the losers of reform support the left wing parties, regardless of which party is currently in the government. This stands in contrast with the result typically obtained for the developed countries-the so-called responsibility hypothesis-that voters are retrospective and punish the government for bad economic performance.

Abstract:
The gravity model of trade is used to assess the economic consequences of new borders, which arose in the wake of break-ups of multinational federations in Eastern Europe. The intensity of trade relations among the constituent parts of Czechoslovakia, Soviet Union and the Baltics was very high around the time of disintegration, exceeding the normal level of trade approximately 40 times. Disintegration has been followed by a sharp fall in trade intensity. On the other hand, the trade liberalization between East and West has lead to gradual normalization of trade relations, and liberalization within CEFTA has reversed the fall in trade intensity among Central European countries.

Abstract:
Recent Eurobarometer survey data are used to document and explain the stock of social capital in 27 European countries. Social capital in Central and Eastern Europe - measured by civic participation and access to social networks - lags behind that in Western European countries. Using regression analysis of determinants of individual stock of social capital, we find that this gap persists when we account for individual characteristics and endowments of respondents but disappears completely after we control for aggregate measures of economic development and quality of institutions. Informal institutions such as prevalence of corruption appear particularly important.

Social capital, institutions, capitalism, transition

Abstract:
Recent Eurobarometer survey data are used to document and explain the stock of social capital in 27 European countries. Social capital in Central and Eastern Europe - measured by civic participation and access to social networks - lags behind that in Western European countries. Using regression analysis of determinants of individual stock of social capital, we find that this gap persists when we account for individual characteristics and endowments of respondents but disappears completely after we control for aggregate measures of economic development and quality of institutions. Informal institutions such as prevalence of corruption appear particularly important.

Social capital, institutions, capitalism, transition

Abstract:
Does migration facilitate regional adjustment to idiosyncratic shocks in transition economies; If so, one should find a strong relationship between regional unemployment and average wages on the one hand, and migration flows on the other. Yet, the evidence from transition economies indicates that the efficacy of migration in reducing inter-regional unemployment and wage differentials has been low. High wages appear to stimulate overall mobility rather than encourage a net immigration, and, similarly, unemployment tends to discourage overall mobility rather than encourage net emigration. Moreover, migration flows have actually been declining in the course of transition, even as inter-regional disparities have been rising.

Migration, Unemployment, Regional Shocks

Abstract:
The gravity model of trade is utilized to assess the impact of disintegration on trade. The analysis is based on three recent disintegration episodes involving the former Soviet Union, Yugoslavia and Czechoslovakia. The results point to a very strong home bias around the time of disintegration, with intra-union trade exceeding normal trade approximately 43 times in the former Soviet Union and Czechoslovakia, and 24 times in the former Yugoslavia. Disintegration was followed by a sharp fall in trade intensity. Nevertheless, there is a considerable hysteresis in economic relations, with trade flows among the former constituent Republics still between two and 30 times greater than normal trade in 1998.

Gravity Model, International Trade, Disintegration, Panel Data

Abstract:
The gravity model of trade is utilized to assess the impact of disintegration on trade. The analysis is based on three recent disintegration episodes involving the former Soviet Union, Yugoslavia and Czechoslovakia. The results point to a very strong home bias around the time of disintegration, with intra-union trade exceeding normal trade approximately 43 times in the former Soviet Union and Czechoslovakia, and 24 times in the former Yugoslavia. Disintegration was followed by a sharp fall in trade intensity. Nevertheless, there is a considerable hysteresis in economic relations, with trade flows among the former constituent Republics still between two and 30 times greater than normal trade in 1998.

Disintegration, gravity model, international trade

Abstract:
In 1993, Czechoslovakia experienced a two-fold break-up: On January 1, the country disintegrated as a political union, while preserving an economic and monetary union. Then, the Czech-Slovak monetary union collapsed on February 8. We analyze the economic background of the two break-ups, and discuss lessons for stability of monetary unions in general. We argue that Czechoslovakia fulfilled some of the optimum currency area criteria; however, given the low correlation of permanent shocks, it appears it was relatively less integrated than some other existing unions. That, along with low labor mobility and higher concentration of heavy and military industries in Slovakia, made Czechoslovak economy vulnerable to asymmetric economic shocks-such as those induced by the economic transition. Furthermore, the Czech-Slovak monetary union was marred by low credibility, lack of political commitment, low exit costs, and the absence of fiscal transfers.

Abstract:
We analyze support for EU membership as expressed in voting patterns in the candidate countries' referenda on EU membership, using regional referendum results and individual survey data on voting intentions. We find that favorable individual and regional characteristics are positively correlated with support for accession and voter participation. In contrast, those who should benefit from future EU transfers are less likely to vote and/or support EU membership. We argue that voters in the candidate countries assign greater weight on future benefits from liberalization and integration than on potential gains through redistribution.

Voting, referendum, EU enlargement, integration

Abstract:
In this paper, I analyze the development of inter-regional mobility in the Czech Republic during the transition from central planning to a market economy. I show that while the intensity of migration is low and has even fallen during the transition, regional disparities in unemployment rates and earnings have increased. More importantly, labor mobility has little effect in facilitating labor market adjustment to employment shocks. Using aggregate inter-regional migration data and survey data on past and prospective migration and the willingness to move, I find that economic factors play little role in explaining migration patterns. There is, nonetheless, some tentative evidence of the greater importance of economic considerations in explaining future migration intentions and the willingness to move. Thus, while at present migration appears more of a social or demographic rather than economic phenomenon, its economic role may strengthen in the future.

Migration, mobility, labor market adjustment, regional shocks, survey data

Abstract:
In this paper, I analyze the development of inter-regional mobility in the Czech Republic during the transition from central planning to a market economy. I show that the intensity of migration is low and even has fallen during the transition regional disparities in unemployment rates and earnings have increased. More importantly, labor mobility is little effective in facilitating labormarket adjustment to employment shocks. Using aggregate inter-regional migration data and survey data on past and prospective migration and the willingness to move. I find that economic factor play little role in explaining migration patterns. There is, nonetheless, some tentative evidence of the greater importance of economic considerations in explaining future migration intentions and the willingness to move. Thus, while at present migration appears more of a social or demographic rather than economic phenomenon, its economic role may strengthen in the future.

Migration, mobility, labor-market adjustment, regional shocks, survey data

Abstract:
Extensive multilingualism is one of the most important and fundamental principles of the European Union. However, a large number of official languages (currently 23) hinders communication and imposes substantial financial and legal costs. We address the merits of multilingualism and formulate an analytical framework to determine the optimal number of official languages in the EU. Using the results of a 2005 Eurobarometer survey of languages in the EU 27, we first derive the sets of languages that minimize aggregate linguistic disenfranchisement of the Union's citizens for any given number of languages. We then proceed by discussing the political-economy framework and feasibility of a potential linguistic reform in the EU under alternative voting rules. We argue that a six-language regime would be a reasonable intermediate choice: a lower number of official languages results in excessive linguistic disenfranchisement whereas adding further languages increases the costs but brings only modest benefits. We also show that even though a linguistic reform reducing the number of official languages to six is unlikely to gain sufficient support at the present, this may change in the future since young people are more proficient at speaking foreign languages.

Disenfranchisement, European Union, Languages, Linguistic standardization

Abstract:
Extensive multilingualism is one of the most important and fundamental principles of the European Union. However, a large number of official languages (currently 23) hinders communication and imposes substantial financial and legal costs. We address the merits of multilingualism and formulate an analytical framework to determine the optimal number of official languages in the EU. Using the results of a 2005 Eurobarometer survey of languages in the EU 27, we first derive the sets of languages that minimize aggregate linguistic disenfranchisement of the Union's citizens for any given number of languages. We then proceed by discussing the political-economy framework and feasibility of a potential linguistic reform in the EU under alternative voting rules. We argue that a six-language regime would be a reasonable intermediate choice: a lower number of official languages results in excessive linguistic disenfranchisement whereas adding further languages increases the costs but brings only limited benefits. We also show that even though a linguistic reform reducing the number of official languages to six is unlikely to gain sufficient support at the present, this may change in the future since young people are more proficient at speaking foreign languages.

Languages, Disenfranchisement, European Union, Linguistic

Abstract:
We argue that econometric analyses of post-communist countries are vulnerable to structural breaks across time and/or countries. We demonstrate this by identifying structural breaks in growth regressions estimated for 25 countries over 18 years. The method we use allows identification of structural breaks at a-priori unknown points in space or time. The only prior assumption is that breaks occur in relation to progress in implementing market-oriented reforms. We find that the pattern of growth in transition has changed at least three times, yielding four different models of growth. The speed with which individual countries progress through these stages differs considerably.

Growth, Reform, Structural breaks, Transition

Abstract:
We argue that econometric analyses based on transition countries' data can be vulnerable to structural breaks across time and/or countries. We demonstrate this argument by identifying structural breaks in growth regressions estimated with data for 25 countries and 16 years. Our method allows identification of structural breaks at a-priori unknown points in space or time. The only prior assumption is that breaks occur in relation to progress in implementing market-oriented reforms. We find robust evidence that the pattern of growth in transition has changed at least two times, yielding thus three different models of growth associated with different stages of reform. The speed with which individual countries progress through these stages differs considerably.

Growth, reform, structural breaks, transition

Abstract:
We argue that econometric analyses of growth in post-communist countries are vulnerable to structural breaks across time and/or countries. We demonstrate this by identifying structural breaks in growth for 25 countries and over 18 years. The method we use allows identification of structural breaks at a-priori unknown points in space or time. The only prior assumption is that breaks occur in relation to progress in implementing market-oriented reforms. We find robust evidence that the pattern of growth in transition has changed at least three times, yielding four different models of growth associated with different stages of reform. The speed with which individual countries progress through these stages differs considerably.

Growth, reform, structural breaks, transition

Abstract:
Recent Eurobarometer survey data are used to document and explain the stock of social capital in 28 European countries. Social capital in Central and Eastern Europe - measured by civic participation and access to social networks - lags behind that in Western European countries. Using regression analysis of determinants of individual stock of social capital, we find that this gap persists when we account for individual characteristics and endowments of respondents but disappears completely after we control for aggregate measures of economic development and quality of institutions. Informal institutions such as prevalence of corruption in post-communist countries appear particularly important. With the enlargement of the European Union, the gap in social capital should gradually disappear as the new member states catch up (economically and institutionally) with the old ones.

social capital, institutions, capitalism, transition

Abstract:
This Paper utilizes a unique dataset on votes cast by Czech and Polish migrants in their recent national elections to investigate the impact of institutional, political and economic characteristics on migrants' voting behavior. The political preferences of migrants are strikingly different from those of their domestic counterparts. In addition, there are also important differences among migrants living in different countries. This Paper examines three alternative hypotheses to explain migrant voting behavior: adaptive learning; economic self-selection and political self-selection. The results of the analysis suggest that migrant voting behavior is affected by the institutional environment of the host countries, in particular the tradition of democracy and the extent of economic freedom. In contrast, there is little evidence that differences in migrants' political attitudes are caused by self-selection based either on economic motives or political attitudes prior to migrating. These results are interpreted as indicating that migrants' political preferences change in the wake of migration as they adapt to the norms and values prevailing in their surroundings.

Voting, migration, political resocialization

Abstract:
This paper utilizes a unique dataset on votes cast by Czech and Polish migrants in their recent national elections to investigate the impact of institutional, political and economic characteristics on migrants' voting behavior. The political preferences of migrants are strikingly different from those of their domestic counterparts. In addition, there are also important differences among migrants living in different countries. This paper examines three alternative hypotheses to explain migrant voting behavior: adaptive learning; economic self-selection and political selfselection. The results of the analysis suggest that migrant voting behavior is affected by the institutional environment of the host countries, in particular the tradition of democracy and the extent of economic freedom. In contrast, there is little evidence that differences in migrants' political attitudes are caused by self-selection based either on economic motives or political attitudes prior to migrating. These results are interpreted as indicating that migrants' political preferences change in the wake of migration as they adapt to the norms and values prevailing in their surroundings.

Voting, elections, migration, political resocialization, transition

Abstract:
Both in the UK and in the US, we observe puzzling gender asymmetries in the propensity to outmarry: Black men are substantially more likely to have white spouses than Black women, but the opposite is true for Chinese: Chinese men are half less likely to be married to a White person than Chinese women. We argue that differences in height distributions, combined with a simple preference for a taller husband, can explain a large proportion of these ethnic-specific gender asymmetries. Blacks are taller than Asians, and we argue that this significantly affects their marriage prospects with whites. We provide empirical support for this hypothesis using data from the Health Survey for England and the Millenium Cohort Study, which contains valuable and unique information on heights of married couples.

Intermarriage, gender, height

Abstract:
Both in the UK and in the US, we observe puzzling gender asymmetries in the propensity to outmarry: Black men are substantially more likely to have white spouses than Black women, but the opposite is true for Chinese: Chinese men are half less likely to be married to a White person than Chinese women. We argue that differences in height distributions, combined with a simple preference for a taller husband, can explain a large proportion of these ethnic-specific gender asymmetries. Blacks are taller than Asians, and we argue that this significantly affects their marriage prospects with whites. We provide empirical support for this hypothesis using data from the Health Survey for England and the Millenium Cohort Study, which contains valuable and unique information on heights of married couples.

Intermarriage, gender, height

Abstract:
The European Union has recently expanded from 15 to 25 countries. In line with this enlargement, the list of official EU languages has grown from 11 to 20. Currently, the EU extends equal treatment to all member countries' official languages by providing translations for documents and interpreting services for meetings and sessions of the European Parliament. This, however, is costly, especially when recognizing that many Europeans speak one of the procedural languages of the EU - English, French or German - either as their native language or as a foreign language. We compute disenfranchisement rates that would result from using only the three procedural languages for all EU business, and marginal costs per disenfranchised person associated with providing translations and interpreting into the remaining 17 languages. The marginal costs are shown to vary substantially across the different languages, raising important questions about the economic efficiency of equal treatment for all languages. We argue that an efficient solution would be to decentralize the provision of translations.

Languages, disenfranchisement, European Union, cost and benefit analysis

Abstract:
This Paper analyses the effect of the introduction of managerial incentives and new human capital on enterprise performance after privatization in the Czech Republic. We find weak evidence for the presence of managerial incentives: only in 1997, three to four years after privatization, does poor performance significantly increase the probability of managerial change. Nevertheless, replacing the managing director in a newly privatized firm improves subsequent performance. This indicates that the privatized firms operate below potential under the incumbent management. We show that the institutional framework matters as well: managerial turnover improves performance only if the management is closely interconnected with the board of directors and thus holds effective executive authority.

Privatization, managerial change, incentives, restructuring, corporate governance

Abstract:
This paper analyses the effect of the introduction of managerial incentives and new human capital on enterprise performance immediately after privatization in the Czech Republic. We find weak evidence for the presence of managerial incentives: only from 1997, 3 to 4 years after privatization, does poor performance significantly increase the probability of managerial change. Nevertheless, replacing the managing director in a newly privatized firm improves subsequent performance. This indicates that the privatized firms operate below potential under the incumbent management. We show that the institutional framework matters as well: managerial turnover improves performance only if the management is closely interconnected with the board of directors and thus holds effective executive authority.

Abstract:
How does implementing harsh economic reforms influence voting behaviour? And how do the patterns of political support change over the course of transition? We analyse these issues using data from a sequence of 11 opinion surveys conducted in the Czech Republic between 1990-98. We find that - while voters' ideological position and some socio-economic characteristics, such as age and education - tend to have a stable impact on voting behaviour over time, economic outcomes, such as employment status, income and unemployment, only affect political preferences in the later stages of the transition. This is consistent with the predictions of the theoretical literature on political constraints during transition - as the uncertainty about reform's outcomes dissipates, constituencies of winners and losers emerge. The winners are the young, educated, high-wage earners and workers employed in de novo private firms. The losers, on the other hand, are the elderly, low-skilled and low-wage workers and the unemployed. The balance between these two constituencies then determines the support for reform-minded and left-wing parties at election time.

Voting, political support, political constraints, transition

Abstract:
Does migration facilitate regional adjustment to idiosyncratic shocks? The evidence from post-communist economies indicates that the efficacy of migration in reducing interregional unemployment and wage differentials is low. High wages appear to encourage and high unemployment tends to discourage overall migration, inbound and outbound, rather than induce a net flow from depressed regions to those with better economic conditions. Even when the impact of unemployment and wages on net migration is statistically significant, it is economically very small. Finally, migration flows declined during the transition, despite rising interregional disparities.

Migration, regional adjustment, regional shocks, optimum currency areas

Abstract:
Does migration facilitate regional adjustment to idiosyncratic shocks? The evidence from post-communist economies indicates that the efficacy of migration in reducing inter-regional unemployment and wage differentials has in fact been rather low. High wages appear to encourage - and, similarly, high unemployment tends to discourage - overall migration - inbound and outbound - rather than induce a net flow from depressed regions to those with better economic conditions. Even when the impact of unemployment and wages on net migration is statistically significant, it is economically very small. Finally, migration flows have actually been declining in the course of transition, even as inter-regional disparities have been rising.

Migration, regional adjustment, regional shocks, optimum currency areas

Abstract:
We analyse support for EU membership as expressed in voting patterns in the candidate countries' referenda on EU membership, using regional referendum results and individual survey data on voting intentions. We find that favorable individual and regional characteristics are positively correlated with support for accession and voter participation. In contrast, those who should benefit from future EU transfers are less likely to vote and/or support EU membership. We argue that voters in the candidate countries assign greater weight on future benefits from liberalization and integration than on potential gains through redistribution.

Voting, referendum, EU enlargement, integration

Abstract:
Both in the UK and in the US, we observe puzzling gender asymmetries in the propensity to outmarry: Black men are more likely to have white spouses than Black women, but the opposite is true for Chinese: Chinese men are half less likely to be married to a White person than Chinese women. We argue that differences in height distributions, combined with a simple preference for a taller husband, can partly explain these ethnic-specific gender asymmetries. Blacks are taller than Asians, and we argue that this significantly affects their marriage prospects with whites. We provide empirical support for this hypothesis using data from the Millenium Cohort Study, which contains valuable and unique information on heights of married couples.

intermarriage, gender, height

Abstract:
Cultural factors and especially common languages are well-known determinants of trade. By contrast, the knowledge of foreign languages was not explored in the literature so far. We combine traditional gravity models with data on fluency in the main languages used in EU and candidate countries. We show that widespread knowledge of languages is an important determinant for foreign trade, with English playing an especially important role. Other languages (French, German, and Russian) play an important role mainly in particular regions. Furthermore, we argue that the effect of foreign languages on trade may be non-linear. The robustness of our results is confirmed by quantile regressions.

European integration, foreign trade, Gravity models, language, quantile regression

Abstract:
Both in the UK and in the US, we observe puzzling gender asymmetries in the propensity to outmarry: Black men are substantially more likely to have white spouses than Black women, but the opposite is true for Chinese: Chinese men are half less likely to be married to a White person than Chinese women. We argue that differences in height distributions, combined with a simple preference for a taller husband, can explain a large proportion of these ethnic-specific gender asymmetries. Blacks are taller than Asians, and we argue that this significantly affects their marriage prospects with whites. We provide empirical support for this hypothesis using data from the Health Survey for England and the Millenium Cohort Study, which contains valuable and unique information on heights of married couples.

Gender, Height, Intermarriage

Abstract:
This Paper utilizes a unique dataset on votes cast by Czech and Polish migrants in their recent national elections to investigate the impact of institutional, political and economic characteristics on migrants' voting behaviour. The political preferences of migrants are strikingly different from those of their domestic counterparts. In addition, there are also important differences among migrants living in different countries. This Paper examines three alternative hypotheses to explain migrant voting behaviour: adaptive learning; economic self-selection and political self-selection. The results of the analysis suggest that migrant voting behaviour is affected by the institutional environment of the host countries, in particular the tradition of democracy and the extent of economic freedom. In contrast, there is little evidence that differences in migrants' political attitudes are caused by self-selection based either on economic motives or political attitudes prior to migrating. These results are interpreted as indicating that migrants' political preferences change in the wake of migration as they adapt to the norms and values prevailing in their surroundings.

Z13, voting, migration, political resocialization

Abstract:
In 1993, Czechoslovakia experienced a two-step break-up. On January 1, the country disintegrated as a political union, while preserving an economic and monetary union. Then, the Czech-Slovak monetary union collapsed on February 8. This paper analyzes the economic background of the two break-ups from the perspective of the optimum currency area literature. The main finding is that the Czech and Slovak economies were vulnerable to asymmetric economic shocks, such as those induced by the economic transition. In particular, the stability of Czechoslovakia was undermined by low correlation of permanent output shocks, low labor mobility and higher concentration of heavy and military industries in Slovakia.

Abstract:
This paper analyzes the political economy of the reform process theoretically and empirically. Building on the framework developed by Rodrik [1995], a two-sector model of a transition economy is constructed. This model is then used to study the dynamics of political support for the reforms. The key role is played by the pattern of flows between the state and private sectors and unemployment. It is shown that while the workers in the private sector always support rapid reforms, the workers in the state sector and the unemployed will support rapid reforms only at the outset of the transition. Later, state-sector workers and unemployed will vote for a reduction in the speed of reforms. The relationship between unemployment and support for the reforms is then tested empirically using regional data from the Czech Republic, Hungary, Poland and Slovakia.