Transforming Post-Communist Political Economies (1998) / Chapter Skim
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Democracy, Social Change, and Economies in Transition
Democracy, Social Change, and Economies in Transition
Pages 401-410
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v Transforming the Role of the State
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From page 403... ...
Normative and prescriptive ideas shadow almost all discussions of states and economic transition. In our own time, social democrats prefer states that intervene in economic activity sufficiently to ensure some minimum of justice and welfare; capitalist liberals want just enough state and just the right kind to guarantee property, enforce contracts, and tune public finances in a way that supports economic growth, while libertarians and anarchists call for little or no state at all.
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One way to create analytical distance between causal processes and desired outcomes is to think of human history since states emerged as a huge set of natural experiments in connections between states and economies. Many sorts of state and many kinds of economic organization have flourished somewhere in the world over that long period, but in retrospect most historians of the two claim to find dramatic covariation between them autocratic empires typically coinciding with landlord-dominated but peasant-based agrarian economies, urbanized trading economies typically supporting thinner oligarchic states, and so on.
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Only with extensive labor markets, wage labor, and governmental monitoring of employing units do income taxes ordinarily yield enough revenue to make the extensive and continuous record keeping and surveillance they entail worthwhile. Ardant also pointed to the reciprocal relationship: state fiscal strategies affect ambient economies by giving their participants incentives and opportunities to hide assets, move capital, shift from one sort of production to another, and create flows that bypass monitoring points.
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of relatively autonomous regional or cultural magnates, thus pushing economic activity toward a division between coerced production of basic goods and quick-return investment in activities generating mobile and easily concealed assets. Capital-intensive states tended to favor cash levies; to draw revenue from excise taxes and customs; and to purchase military means on national or international markets, thus promoting the further commercialization of their economies.
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From page 407... ...
States serve exploitation in two different ways through direct production of goods and through intervention in the production of goods under control of their favored collaborators. Through most of their history, states have directly produced military goods for the benefit of their rulers; sometimes produced fiscal goods, such as monopoly salt or tobacco, to sell for state revenues; but otherwise concentrated on assisting exploitation by their ruling classes.
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From page 408... ...
We have been willing to assume that post-communist economies will integrate more extensively into the circuits of world capitalism than did their Warsaw Pact predecessors, but not that they will become replicas of existing capitalist economies. We have argued that both institutional legacies of state socialism and continuing involvement of state actors in economic change must significantly affect how closer integration into the capitalist world occurs, and with what effects.
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From page 409... ...
the paths of such economies to more extensive markets will differ both among those economies and between them and existing economies; and (3) effective interventions to hasten market expansion will require close analysis of existing social structure, extensive revamping of underlying nonmarket institutions, and continuous monitoring of nonmarket effects with an eye to feedback that will transform the conditions and likely consequences of intervention.
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From page 410... ...
Although theorists of democracy, capitalism, and economic growth commonly take strong positions on how each of these processes covaries with and affects the others, no consensus has emerged among students of these subjects. Even within this one section of our volume, opinions run from Aslund, who, while conceding that a "strong civil society" promotes economic growth, generally treats democracy as an outgrowth of capitalism, to Walder, who implies that China is experiencing rapid economic growth and extensive alteration of state structures without moving at all decisively toward democracy.
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