Divide and pacify : the political economy of the welfare state in Hungary and Poland, 1989-1996
The thesis proposes a theoretical explanation for the comparative political quiescence of the post-communist transitions in Hungary and Poland between 1989 and 1996. Contrary to prior expectations and to earlier reform experiences in Latin America, the early 1990s in Central and Eastern Europe have been non-violent and comparatively non-disruptive. Emphasizing the role of welfare states in influencing collective action, I specify a political strategy that could reduce the capacity of working-age individuals to organize disruptive protests. The crux of this strategy was to split up well-networked and formally organized groups of workers in precarious jobs, by sending some of them onto unemployment benefits and many others onto 'abnormal' pensions (early retirement and disability retirement). The latter groups were likely to have a decreasing capacity to mobilize for collective action due to less advantageous social networks combined with increasing distributional conflicts over scarce state resources. Moreover, at a time of strongly declining living standards the unemployed and the abnormal pensioners had stronger economic incentives to earn informal private sector incomes, instead of pursuing public goods through collective protests. A number of social policies consistent with such a 'divide and pacify' hypothesis have been adopted in post-communist Hungary and Poland, though not in the Czech Republic. In particular, both Hungary and Poland experienced large and unprecedented increases in the numbers of 'non-elderly' pensioners between 1989 and 1996.