The Post-Communist Divergence: The Transformation of Economic Governance in Russia and Poland, c. 1965-2000

Abstract

The dissertation analyzes the timing, extent, and causes of the divergent paths of economic governance in the USSR/Russia and Poland from the mid-1960s to the end of the 1990s through a comparative analysis of their flagship automobile producers. The histories of these enterprises mirror the larger economic divergence between Poland, which developed a dynamic market economy with competitive manufacturing industries, and Russia, which devolved from an industrial superpower into an increasingly oil-dependent commodity exporter. Their shared origins in parallel Fiat licensing contracts from 1966 and 1971 respectively make these enterprises a unique case study of the evolution of two systems of economic governance, defined not just as institutions and policies at the level of the central state authorities, but also business-state relations at the regional and local levels, as well as systems of management, corporate governance, and labor relations at the enterprise level. The main argument of the dissertation is that the post-communist economic divergence between Russia and Poland must be understood in light of important structural developments that were rooted in the late communist era. The first of these was the deeper economic integration of Soviet satellite states like Poland with the West, which resulted from the failure of the Comecon to provide satisfactory levels of trade and technology transfer for the smaller, more open Eastern European economies, in combination with the greater weakness of Eastern European communist regimes and the resulting higher level of living standards needed to placate their populations. The second development was the more advanced marketization in Poland before the collapse of communism, which resulted from the Solidarity revolution of 1980-81, which caused a breakdown of the institutions and legitimacy of the planned economy. And thirdly, in Russia, unlike in Poland (and East-Central Europe more broadly), the institutional hierarchies of the state disintegrated along with the communist regime, which greatly obstructed orderly market reform and laid key foundations for Russia’s authoritarian turn in the 2000s. These developments did not predetermine the outcome of post-communist economic reform, but they did profoundly shape the incentives, opportunities, and obstacles faced by policymakers and entrepreneurs during the 1990s and beyond.