The 'soft state' : business-government relations in post-communist Poland
I define modes of business-government relations by the actor, which represents business. In the association state, business associations are dominant. In the company state, the firm directly represents itself. In the party state, access to the political system is mediated by parties, with which businesses must identify themselves. In the soft state, the personal connections of businesspeople are the dominant channel of influence. The existing literature on business-government very rarely acknowledges that each mode forms part of the environment of business- government relations for the other modes. Of the four modes, by far the least attention has been given to personalism. I find the association state to be weak because large numbers of small firms, weak trade unions and the sectoral configuration of Polish business present few incentives for the formation of business associations. The company state is usually associated with foreign and state enterprises. Foreign direct investment has been relatively modest in Poland. When state enterprises directly engage with the state, they tend to do so, not as businesses, but in alliance with trade unions. The party state is undermined by the high governmental turnover in Poland. It makes no sense for business to commit itself to parties, which are only temporary rulers. The soft state is found to be the dominant form of business-government relations. The sources of personalism are partially hidden behind complex personal histories. However, involvement in youth organisations is a powerful predictor of the level of personal connections to politicians amongst the business elite. Fundamental, and unlikely, changes to political competition and economic structure are necessary for Poland to become an association or a party state. In contrast, foreign ownership is increasing and state ownership is decreasing and transforming itself. Some of the conditions for personalism are also being undermined. In the future, instead of being a soft state, permeated by personal interests, Polish business government relations may move towards the company state.