Sabina Avdagic

When are concerted reforms feasible?: Explaining the emergence of social pacts in Western Europe.

Under what conditions do governments, employers, and unions enter formal policy agreements on incomes, employment, and social security? Such agreements, widely known as social pacts, became particularly prominent during the 1990s when European economies underwent major adjustment. This article seeks to explain national variation in adjustment strategies and specifically why concerted agreements were struck in some countries but not in others. A fuzzy-set qualitative comparative analysis of 14 European countries is employed to assess main arguments about the emergence of pacts. The analysis yields two key findings. First, although prevailing arguments emphasize Economic and Monetary Union—related pressures, or alternatively unemployment, these factors were neither necessary nor in themselves sufficient for pacts to materialize. Rather, a high economic “problem load” appears to be causally relevant only when combined with particular political and institutional conditions, namely, the prevalence of electorally weak governments and/or an intermediate level of union centralization. Second, the analysis refines existing multicausal explanations of pacts by demonstrating three distinct, theoretically and empirically relevant causal pathways to concerted agreements.

Does Deregulation Work? Reassessing the Unemployment Effects of Employment Protection

Using new data, this article examines the effect of employment protection legislation (EPL) on aggregate and youth unemployment in advanced economies and Central and Eastern Europe during 1980–2009. The results offer no clear support for the argument that EPL is a cause of unemployment. Although EPL reaches statistical significance at conventional levels in some models, the results are sensitive to small changes in the sample or the use of alternative estimators. While the analysis suggests some scope for complementary reforms of EPL and the tax wedge in tackling youth unemployment, the findings on the whole indicate that government efforts to tackle unemployment by deregulating EPL alone may well be futile.

Partisanship, political constraints and employment protection reforms in an era of austerity

Why do some governments adopt unpopular reforms entailing far-reaching liberalization of the labour market, while others opt only for marginal adjustments or even regulatory reforms? This paper explains the likelihood of different types of reform as an effect of different constellations of government partisanship and veto players. Combining the ‘blame avoidance’ and ‘veto players’ logics of politics, the paper argues that veto players have either a constraining or enabling effect depending on the partisan orientation of government. Correspondingly, liberalization is most likely to be adopted either by right parties facing few veto players, or by left parties in contexts with a high degree of power sharing. Regulatory reforms are most likely when left governments enjoy strong power concentration, but marginal regulation may be also adopted under external pressure by right governments facing many veto players. An analysis of employment protection reforms in 24 EU countries during 1990-2007 supports the argument that the effect of political constraints and opportunities on the choice of reforms is shaped by partisan differences

Tripartism and Economic Reforms in Slovenia and Poland

The establishment of peak-level tripartism has accompanied market transformations in virtually all countries in Central and Eastern Europe. With the main aim of preserving social peace while enhancing economic progress, these tripartite structures were to facilitate negotiation and deliberation between the government and organized labour and business over a wide range of reforms and socio-economic policies. While these institutions display a striking similarity in terms of their formal functions and responsibilities, their actual functioning and the impact on economic reforms have varied greatly. This chapter analyses the varied impact of tripartism on economic reforms and its consequences for socio-economic outcomes in Slovenia and Poland — these two countries can be characterized as cases of strong and weak tripartism respectively.