Law and Development in Central and Eastern Europe: Neoliberal Developmental State and Its Problems

Abstract

In the first part of the article, I describe the origins of neoliberal developmental states in CEE. I start with the outline of administrative reforms during the age of the Washington consensus and examine how the neo-liberal legal policies and theories affected the administrative structures built in that period. I try to show that under the influence of the neoliberal "rule of law" model CEE developed a distinct, neoliberal developmental state. During the early stage of administrative reforms, they followed a one-size-fits-all approach and hastened to transplant various Western-style administrative structures without paying sufficient attention to social context and disregarding the policy relevance of such rules. I use the example of civil service reforms because they were at the epicenter of the first stage of administrative reforms. In the second part of the article, I discuss the EU-inspired innovation development policies, which gradually emerged as a major albeit truncated version of developmental policy in CEE. But then again, the inadequacy of the administrative structures built during the early stage of transition turned out to be one of the key inhibiting factors that prevented these new development policies from succeeding. However, as the Strategy for Poland, the only alternative development strategy to the Washington consensus in the region shows, selection of adequate economic policies is as important as the creation of adequate legal and political institutions. Poland achieved remarkable economic results with institutions which were considered to be inadequate by actors like the EU, the World Bank and IMF. I conclude with general observations about the importance of CEE examples for development policies of other middle-income countries (MICs) in the region.

Keywords: Law and development, Central and Eastern Europe, rule of law, neoliberal developmental state, new institutional economics, post-Washington consensus