Hilary Appel and Mitchell A. Orenstein: From Triumph to Crisis: Neoliberal Economic Reform in Postcommunist Countries

Abstract

The postcommunist countries were amongst the most fervent andcommitted adopters of neoliberal economic reforms. Not only did theymanage to overcome the anticipated domestic opposition to 'shocktherapy' and Washington Consensus reforms, but many fulfilled themembership requirements of the European Union and even adopted avant-garde neoliberal reforms like the flat tax and pension privatization.Neoliberalism in the postcommunist countries went farther and lastedlonger than expected, but why? Unlike pre-existing theories based ondomestic political-economic struggles, this book focuses on the imperativesof re-insertion into the international economy. Appel and Orenstein showhow countries engaged in 'competitive signaling', enacting reforms in orderto attract foreign investment. This signaling process explains the enduranceand intensification of neoliberal reform in these countries for almost twodecades, from 1989–2008, and its decline thereafter, when inflows of capitalinto the region suddenly dried up. This book will interest students ofpolitical economy and Eastern European and Eurasian politics.