The Political Economy of Reforms: Empirical Evidence from Post-Communist Transition in the 1990s

Using a novel data set from post-communist countries in the 1990s, this paper examines linkages between political constraints, economic reforms and growth.A dynamic panel analysis suggests public support for reform is negatively associated with income inequality and unemployment.Both the ex post and ex ante political constraints of public support affect progress in economic reform, which in turn influences economic growth.The findings highlight that while economic reforms are needed to foster growth, they must be designed so that they do not undermine political support for reform

Assessing Equilibrium Exchange Rates in CEE Acceding Countries: Can We Have DEER with BEER without FEER? A Critical Survey of the Literature

The ambition of this paper is to provide a thorough overview of equilibrium exchange rates in the acceding countries of Central and Eastern Europe.Therefore, theoretical models of equilibrium exchange rates are reviewed first and presented in a structured way.Subsequently, the existing body of the empirical literature aimed at investigating real exchange rate determination and possible misalignments is analyzed in a systematic manner.Finally, an attempt is made to sum up where we stand at the moment and what the major shortcomings of the approaches currently used in the literature are