Political Economy of Crisis Management in East-Central European Countries

Europe-Asia Studies, 65(3), 2013, 383–410.

39 Pages Posted: 4 Mar 2014

See all articles by Martin Myant

Martin Myant

University of the West of Scotland

Jan Drahokoupil

University of Mannheim - Mannheim Centre for European Social Research (MZES); European Trade Union Institute (ETUI)

Ivan Lesay

Slovak Academy of Sciences - Institute of Economic Research

Date Written: January 1, 2013

Abstract

This paper analyses policy responses to the financial and economic crisis in the central east European countries. The crisis raised the profile of economic policy themes that relate to the role of taxation and state spending. The key policy differences related to public budgets and support for a demand stimulus. Responses fall broadly into two categories that we link to a social-democratic and a neo-liberal response. The distinction indicates that the policy responses were linked to the party affiliation of the government on the left-right spectrum. There were some remarkable common trends that cannot be explained by the logical requirements of the economic situation alone. There are differences in timing and in severity, but every country has gone towards the budget-balance-by-cuts road at some point. In all cases there were cuts in benefits for marginal groups in society and a switch towards indirect rather than direct taxes: these carry clear distributional implications.

Keywords: transition economies, economic policy

JEL Classification: E6

Suggested Citation

Myant, Martin and Drahokoupil, Jan and Lesay, Ivan, Political Economy of Crisis Management in East-Central European Countries (January 1, 2013). Europe-Asia Studies, 65(3), 2013, 383–410.. Available at SSRN: https://ssrn.com/abstract=2116176

Martin Myant

University of the West of Scotland ( email )

Paisley High Street
PA1 2BE
Paisley, Scotland PA1 2BE
United Kingdom

HOME PAGE: http://www.paisley.ac.uk/schoolsdepts/business/cces/researchers/martin-myant.asp

Jan Drahokoupil (Contact Author)

University of Mannheim - Mannheim Centre for European Social Research (MZES) ( email )

D-68131 Mannheim
Germany

HOME PAGE: http://drahokoupil.blogspot.com

European Trade Union Institute (ETUI) ( email )

B-1210 Brussels
Belgium

Ivan Lesay

Slovak Academy of Sciences - Institute of Economic Research ( email )

811 05 Bratislava, Šancova 56
Bratislava, SVK
Slovakia

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