The post-socialist developmental state

In Chapters One, Three and Four, we discussed the developmental state. We now turn our focus to its post-socialist version. The post-socialist developmental state (PSDS) model is a type of developmental state (DS) model within the frames of contemporary post-socialist transformation. It fuses the two intellectual streams of the developmental state concept and post-socialist transformation (PST). Its basic features are similar to those in the DS model adjusted by the PST process and different international conditions, as compared to historical DS cases. There can be various genera of the PSDS model, as each country would have its own variation of institutional features and policy solutions, and China's development trajectory represents one of those genera. The PSDS model brings into the discussion on the DS model two important elements: first, it debates its broader than usual applicability, extending it to a very particular group of countries in systemic transformation; and, second, it confronts the model with a different international conditionality than that experienced during the high-growth period of historical developmental states.

In addition to guiding the development trajectory by many means characteristic of the classical DS model, as examined earlier, the postsocialist developmental state has the task of systemic transformation. Consequently, the role of the state, in addition to actively supporting and enabling an effective development trajectory (which has somewhat been lost in the process of post-socialist transformation due to political and economic-doctrinarian reasons), also includes presiding over economic liberalisation, market institutionalisation and microeconomic restructuring. The PSDS should be characterised by selective, and perhaps cautious, economic liberalisation, as socalled ‘shock therapy’ has produced extensive economic contraction in the post-socialist world and subsequently significantly impaired developmental dynamics. The economic-systemic reorganisation creates two unfavourable conditions: first, the state's attention is captured by systemic transformation and development policies are usually neglected, as was the case in the majority of post-socialist states: and, second, the process leaves the economy in interim vulnerability due to the dissolving of old institutions and the creating of new ones. This ‘transformational vulnerability’ negatively affects the state's ability to maintain a stable, favourable environment for development.