Heft36 1 - SFB 580 - Friedrich-Schiller-Universität Jena

THE VOC EINLEITUNG APPROACH GOES EAST
What we have to keep in mind is that the
ability of enforcement and complementarity
depend on the context (external environment,
historical legacy, state capacity). As this context
varies among transition countries, every country
should conduct reforms that take into account
different environmental pre-conditions in
terms of economic development, geographic
situation, resource endowment, human
resources, networks and informal institutions.
In my opinion, institutional complementarity
in the transition context should be understood
more broadly, namely as compatibility in time,
space and existing structures. A good model
of institutional change in post-communist
economies should, therefore, incorporate
resources, geography, history and the dynamic
interplay between the economic and political
arenas during transition.
The complementarity of institutions depends
on changing environmental circumstances.
This means that coherent institutions will
be beneficial in the “good times” (i.e. when
fundamental reforms are not required), but
detrimental in the “bad times”, when change
is most needed. Because of a changing
environment, institutional complementarity
and enforcement should be understood as
dynamic concepts, i.e., there should always
be room for experimentation and adaptation
of the institutional structure (see North
1990). To enable change and
flexibility, adaptive institutional
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complementarity is required. If
too much emphasis is put on static
institutional complementarity, the
political economy can become inflexible and
lose its comparative advantage. The emphasis
on enforcement, which I made before, does not
necessarily produce inflexibility and institutional
inertia as long as enough room is left for
institutional experimentation and competition.
The dynamic approach of adaptive institutional
efficiency would enable institutional change
within particular types of institutions without
necessarily changing the entire institutional
sub-system. Allowing Siemens, Infineon or
IBM to increase engineers’ wages to cope with
low supply of engineers, without changing the
overall wage policy, is such an adaptive way of
specific peripheral change. A second example for
experimentation, under continuing dominant
logics of coordination, is the introduction
of temporary work agencies to reduce labor
market rigidities in Germany (Höpner 2005,
p. 333). Within such an adaptive process of
change, learning and the adoption of new skills
are important. However, learning does not
mean transferring best practices from abroad,
but rather searching for functional equivalents
and local solutions.
4. CONCLUSION
The research question I started with was
whether the VoC approach and, particularly,
its concepts of institutional complementarity
and limited coordination modes can be
helpful in explaining institutional diversity
and institutional development during postcommunist
transition. The answer is: “yes, but
only in parts”. Let me summarize my results by
evaluating the usefulness of the VoC approach
for every research step in a comparative analysis
(table 5).