Title: Globalizing Tendencies in Public Policy
Author: mjgcain
Last saved by: Nispacee

Globalization and the Development of Social Welfare Reforms 
In 
Eastern Europe

Michael J.G. Cain

Political Science Department
St. Mary’s College of Maryland
USA

Aleksander Surdej
Cracow University of Economics
Poland

Remarkable changes in social welfare and pension policy are occurring in Central and Eastern Europe.  Countries throughout the region are moving rapidly toward fundamental reforms in their public pension systems.  Some countries have completed reforms recently, while others appear to be moving quickly toward reform policies in 2000 and 2001.  The circumstances of reform in Central and Eastern Europe contrast markedly with reforms in more established Western democracies.  In Western democracies, when reforms occur, they are less radical, slower and extremely contentious (Pierson, 1994).  This contrast between East European democracies and Western democracies raises questions about the nature and reason for pension reform processes in Central and Eastern Europe as well as questions about the development of public policy in transitioning societies.  Why have East European states been so active in initiating and developing basic reforms in their pension systems?  Are transitioning processes contributing to social welfare reform efforts?  Are the politics of transitioning states fundamentally different from the politics of more developed democracies?  

Russia and the Ukraine appear to be moving toward reform packages.  Slovenia passed major pension reforms laws in 2000.  Bulgaria, Croatia and Moldova passed pension reform legislation in 1999.  See Table 1 for an overview of reform processes prior to 1998 in the region.

	This essay seeks to understand these questions by looking at international influences on domestic policy processes.  After discussing the general role of international actors in the reform process and the need for social welfare reforms in Eastern Europe, we describe reasons why democratic politics reduces the probability that reform processes will produce extensive changes in social welfare systems.  This essay then describes different globalizing influences on social welfare reform processes and argues that different types of globalizing factors produce endogenous incentives for change that do not exist in many Western democratic countries.  These globalizing factors also produce asymmetric influences on the reform process in different countries across the region, consistent with observed tendencies in reforming countries in Central and Eastern Europe.  The result of this analysis is a new conception of the role of global factors on domestic policy processes in transitioning democracies.  

I. Why is Social Welfare Reform Occurring In Eastern Europe?
All this observed activity on pension reform in the region is certainly not a necessary feature of the transitioning process, nor was it predicted as an important part of early neoliberal reform efforts.  Price liberalization, regular and fair elections, legislation on property law as well as a host of other policies could easily be understood as essential to market and democratic transition processes or at least part of an early sequence in transitioning efforts (Blanchard et al., 1991; Przeworski, 1993).  Though arguably important, social welfare reform does not appear essential to democratic or market transitions, nor does it appear essential to an early sequence of reform processes.  Instead there are two circumstances that explain why reforms efforts are gaining momentum in Eastern Europe.  One circumstance is associated with the importance of international actors in the region, while the other circumstance is associated with the special circumstances of transition in Eastern Europe.
External actors are a playing major role in initiating reform processes throughout the region.  International actors such as the World Bank and the International Monetary Fund have been coaxing new transitional democracies in Central and Eastern Europe to restructure the delivery of social welfare.  These international organizations have not only provided expert planning and analyses to various governments, they have also provided cash subsidies to aid the transition to market based pension systems.  Yet why have these international organizations been so interested in promoting such reforms?
Social welfare reforms can be understood, in one sense, as part of an overall reform strategy often referred to as the Washington consensus—the set of economic, social and political reforms backed by the International Monetary Fund, the World Bank, the United States Treasury Department and ultimately the White House (Williamson, 1990).  The goal of these reform strategies in the early 1990s was to help create free market systems with effective democratic governments to replace existing socialist economies.  No doubt the reform strategies associated with the Washington Census have not always been clear or consistent throughout the 1990s (Naím, 2000).  Yet social welfare reform strategies have always been a part of this general reform strategy and international actors have promoted social welfare reforms religiously.  What kind of changes have these international actors recommended?
The preferred strategy to achieve reform involved the gradual establishment of multi-pillar systems to replace the dominant PAYG system inherited from socialist societies.  These multi-pillar systems would provide a much closer link between individual contributions and pension payments, provide the promise of separate financing of payments from established capitalized accounts and eventually promised to reduce the direct role of government in financing many East European pension funds.  Pension reform was recommended, moreover, to encourage long-term economic growth, to decrease government budget deficits, improve tax collection and shrink the size of the public sector.  Reforms would then create positive incentives for savings, help alleviate tax delinquency and generally have salutary macro economic effects on the economy (Barr, 1994). 
The other reason for social welfare reform concerns the special circumstances of transition in Eastern Europe.  The political and macro economic climate in Eastern Europe in the mid-1990s created the need for instituting rapid reforms across the region.  The introduction of market reforms in the early 1990s created harsh economic downturns throughout the region—falling GDP rates, high levels of inflation and growing unemployment.  To lessen the effects of unemployment caused by the transition to a market economy, many governments in Eastern Europe responded by raising basic pensions and encouraging retirement for older workers.  Large numbers of workers became eligible for new pensions while the level of pension benefits to new retirees increased.  These changes resulted in progressively larger government commitments to social welfare spending in the 1990s (See Table 2). 
As government obligations for social insurance increased in countries throughout the region, the ability of governments to collect taxes to meet these growing fiscal obligations decreased.  Growing levels of unemployment, early retirements, laborers fleeing work for the gray economy and corruption in state enterprises resulted in steadily decreasing numbers of workers and firms paying into state insurance funds.  These changes resulted in decreases in net tax receipts for social insurance that placed ever-increasing pressures on state budgets.  When these factors are combined with unfavorable demographic indicators in the region, it is easy to understand why poor system dependency ratios in almost all transitioning economies in Eastern Europe promised to create almost continuous pressure on state budgets well into the future (See Table 3).  

That is the ratio of pensioners to workers.

	Increasing obligations by the state for new pensioners coupled with falling tax revenues for existing pensioners placed tremendous pressures on state budgets throughout the region.  As a result of these circumstances, many governments, prompted by different international organizations, began considering, initiating and implementing basic reforms in their existing social welfare systems.  Reform of social welfare in Eastern Europe has occurred because it was needed and international actors, as we shall see, have been willing to facilitate this reform effort in different ways.  Of course these factors merely suggest why reforms could have occurred when they were needed.  Other domestic conditions, such as the institutional features of democratic rule, can easily undermine the success of any reforms efforts.

II. Problems of Reform in Democracies
International actors encouraged governments to reform their existing PAYG pension systems in deteriorating economic environments during the 1990s.  Yet many Central European governments had to undertake pension reforms in very contentious democratic environments (Cook et al, 1999).  Besides instituting new legal and organizational procedures to collect taxes and distribute benefits for old age, governments needed to shrink the size of their public spending on pension benefits.  Students of democratic politics are well aware that this often presents enormous difficulties to governments.     
Decreasing public spending or--more specifically--shrinking a welfare state, presents special problems to governments in contentious democratic environments.  These problems arise because differences in incentives among different parties normally lead to inaction.  When a government is spending too much money, eliminating deficits through decreases in public spending can provide a society with definite, long-term benefits.  These benefits are distributed among the population in an uncertain manner, over a long period of time, in relatively small individual amounts.  By contrast the costs of decreased public spending are often felt quickly and distributed in a way that is generally known to everyone.  
The freedom of the electorate to choose their leaders presents difficulties to politicians who wish to get reelected and cut public spending.  If voters discount the future by a small amount, as most voters and citizens tend to do, then politicians who reduce social benefits by decreasing payments can expect to face the wrath of those citizens most affected by reduced benefits.  Facing the wrath of citizens, as many politicians know, is not something they look forward to, especially if they wish to continue their job in office.  Therefore politicians in democratic societies, in the absence of special circumstances to the contrary, prefer not to shrink the existing social pie provided to voting members of the society.  
This is a general constraint on the behavior of majority coalitions known by all incumbent legislators in democratic societies—when preparing a budget try not to cut spending to identifiable groups in your coalition.  Researchers also know it.  Theorists such as Paul Pierson (1994; 1996), for example, have given detailed accounts explaining why democracies normally cannot cut social welfare spending or advance deep reforms in social welfare programs.  According to Pierson, “. . . welfare state retrenchment generally requires elected officials to pursue unpopular policies that must withstand the scrutiny of both voters and well-entrenched networks of interest groups.” (1996, p. 143).  His rather pessimistic account of policy change in democracies is also corroborated by a large literature in public choice theory on democratic politics and interest group behavior (Mueller, 1989). 

III. Is Social Welfare Reform Distinctive in East European Transitioning Countries?
Understanding the problem of welfare reform in Central and Eastern Europe reduces to a set of conflicting factors.  International actors have encouraged reforms in a deteriorating economic environment, while otherwise normal democratic politics tends work against the implementation of any reforms that may hurt identifiable groups.  Research on social welfare reforms in Eastern Europe has therefore focused on special features of the transitioning process that facilitate reform policies, domestic institutional factors that short circuit normal democratic politics or local conditions that encourage reform policies.  Most of this research acknowledges that reform has been slow in the region and that many different constraints tend to make changes in social welfare spending difficult or emphasize why social welfare reform should be unlikely.  
In developed democracies fundamental change in social security systems is certainly not expected, and whenever it occurs, theorists look for special mechanisms that explain cuts in benefits or general retrenchment of the welfare state.  Yet in Eastern Europe the story of social welfare reform is fundamentally different from the social welfare of developed democracies.  In the last several years change in the social welfare systems of Eastern Europe has been frequent, sustained and in some cases radical.  The question is not so much why changes have been difficult, but rather why they have been so easy—especially when compared to reform processes in many Western democracies.
One factor that is essential to understanding differences in pension reform between developed democracies and transitional democracies is the role of international or global actors.  Although this factor is implicit in many discussions of the political economy of pension reforms in transitional states, the role of international or global factors on domestic policy changes is rarely discussed as an independent explanatory variable.  Below we explore how international influences created important incentives for East European transitional countries to pursue reforms strategies in their social welfare systems.  This has lead to a convergence in the behaviors of many governments in Central and Eastern Europe on questions of social welfare reform.  These incentives, however important they may be, are not always independent of endogenous domestic factors.  As a result, policy outcomes resulting from reform efforts, did not converge and were highly differentiated among East European transitioning states.

To explain reform processes researchers have cited the importance of pension debt, path dependencies or legacies associated with each country, differences in governing bodies and institutions, differences among the ideology of domestic policy elites, constraints on policy formation and implementation, as well as endogenous interest group constraints.  Each of these factors has been found to influence the type, speed and success of social welfare reforms.

IV. Globalizing Tendencies in Public Policy
	International financial institutions (IFIs), development banks as well as various development agencies in the United States and Europe have strongly influenced the development of reforms in transitioning economies in the 1990s.  Major actors involved in reform efforts in the 1990s include the World Bank, the IMF, USAID, the US Treasury department, the European Bank for Reconstruction and Development, the International Labor Organization and the European Union’s TACIS program.  These actors exerted tremendous influence on transitioning countries in the 1990s.  As we shall see, the penetration of these multilateral and bilateral agencies into the social welfare reform processes throughout the region has been broad, sustained, and deep.  How have these various agencies influenced domestic social reform policies across countries in the region? 
Many different global actors have exerted diverse kinds of exogenous influences on domestic policy processes.  International influences include the provision of international public goods, mechanisms that reward standard regulations in compliance with a globalized order, direct incentives provided by IFIs in the form of conditionalities on structural adjustment loans, direct compensation or aid to develop and implement reform packages from both IFIs and development agencies.  These actors and their associated influence have had a dramatic effect on the delivery of social welfare in the region influencing the initiation, process and implementation of reforms, offering different pure and impure public goods combined with private excludible benefits that resulted in different incentive properties across countries.

IV. 1. Global Public Goods and Pension Reform
In the context of pension systems, the provision of pure and impure international public goods is important for understanding social welfare reforms in East European transitioning countries.  International public goods are widely acknowledged as an important globalizing force for international cooperation among countries (Kaul et al., 1999; Stiglitz, 1998) as well as an important element in shaping domestic public policies (Braithwaite and Drahos, 2000).  What are international public goods?  They are characterized by the same properties as ordinary public goods, that is, pure international public goods possess non-excludable and non-rival properties, but unlike ordinary public goods they transcend national borders and national interests.  For international public goods, non-excludability refers to the inability of states to effectively exclude countries from enjoying the benefits of such goods, while non-rivalry suggests that one country’s consumption of the good does not affect the benefits of another country’s consumption.
	The role of international actors, especially IFIs in developing policy frameworks that provide information and knowledge about the consequences of alternative policies is well known (Stiglitz, 1998; Worldbank, 1998).  Although the specific value of this knowledge and information for the initiation and development of pension policy reforms in countries in Eastern Europe has been widely acknowledge, its significance for understanding the reform process has not been fully explored.  IFIs and other international actors have provided information and expertise about different kinds of pension systems, a robust understanding of the importance of different “pillars” in a country’s pension system, the interrelationship between pillars, econometric projections about the consequences of different reform plans on the economy, expertise on methods of accounting for social security systems, expert advice on various methods of tax collection from individuals and firms, legal and technical advice on the development of basic reforms laws as well as regulatory laws.  These different informational services were available to all countries and all interested parties as part of the standard package of reform materials.  Yet how important were these public goods to the reform of social welfare systems in Eastern European transitioning countries?
	Reform in social welfare systems could not have occurred without the provision of these international public goods.  Transitioning economies throughout Central and Eastern Europe were not in a position to develop extensive studies on different types of welfare systems available to them or their societies.  Governments were also not in a position to evaluate the consequences of different policy reforms, nor in a position to extensively study the best means to institute such reforms.  Clearly the start-up costs to all countries in the region for the unilateral provision of such knowledge would have greatly exceeded the benefits of developing this knowledge base.  It is also unrealistic to assume these countries could have collectively established such a vast pool of expertise and information given the fiscal pressures associated with all public expenditures in the 1990s as well as the relatively low level of development in the fields of public policy and applied economics.  Therefore the existence of international public goods, provided by a group of different international agencies was quite likely a necessary condition for the development of reforms in Central and Eastern Europe.

IV. 2. Additional Global Mechanisms Influencing Domestic Reform 
	Besides international public goods, other global factors influenced the development and speed of reform processes in individual countries.  International systems of reward are structured to globalize the regulation of public policy by raising the expected value of compliance associated with a global order.  Actuarial models of pension reforms, for example, need to meet international standards if they are to evaluated and compared.  The World Bank’s PROST model is one such system that is used to evaluate pension systems and the United States Agency for International Development has provided funds to consultants to aid such compliance in a variety of countries in Central and Eastern Europe (USAID, 2000).  States therefore have incentive to begin discussion of public policy reforms in their pension systems using existing models and methods provided to them by Western agencies.  This allows countries not only to draw on existing international expertise, but also to perform comparative evaluations of any new proposed pension systems with reforms in countries similar to them at relatively low costs.
	The expected value of compliance with global standards of public policy differs across transitioning countries however.  In Central Europe, for example, the expected value of compliance with internationally accepted standards is higher for countries that hope to join the European Union (EU) than for countries that have no such hopes, since they stand to gain both short and long-term benefits associated with passing reforms necessary to make accession more attractive.  In Poland, Hungary and the Czech republic, domestic actors benefited directly from compliance with an emerging global order.  Government officials from both left and right parties in each of these countries have often framed international policy around a commitment to joining the European Union.  They have done this in part because of the strong domestic constituencies interested in EU membership (See Figure 1).  Shirking an emerging global order and going it alone could easily impose costs on politicians or parties who advocated such policies.  As a result, domestic political actors in Central Europe who advocated policies that were inconsistent with the general goal of EU membership would have exposed themselves to unnecessary political risks.  Domestic constituencies also received direct benefit from embracing global standards.  In Hungary and Poland trade unions are founders in new “third pillar” pension funds in joint ventures with the Zurich Insurance group.  Without compliance with global regulations, such options would not be feasible.

They proved very significant for the passage of reforms in each country.  See Brooks and James, 1999 and Orenstein 2000.

The benefits associated with global public goods or matching the standardization in regulatory mechanisms occurring internationally, lower the costs of the development and implementation of social welfare reforms, create positive externalities for other regulatory goals as well as create policy options that may not be otherwise available to countries.  However IFIs also employed more coercive means to encourage governments to comply with their reform agenda in social policies.  In transitioning countries throughout the East European region, the reform of state pension systems topped the list of IMF and World Bank conditionalities for structural adjustment loans (Cashu, 2000).  The scope and nature of pension reforms in many of East European countries became part of regular negotiations with the IMF and World Bank concerning whether or not they received particular loans (Wyzan, 1999).  Since governments depended on these loans to sustain their economies during extremely difficult periods of transition, the importance of implicit threats from IFIs for making progress on pension reform cannot be underestimated.  Conditionalities amounted to direct incentives by Western actors to dissuade East European governments from postponing reform efforts.
Governments in Central and Eastern Europe in the 1990s did not take World Bank and IMF threats lightly.  Outright defiance of core IMF recommendations carried real costs to governments.  For example strong public criticism from the IMF of the Olszewski government in Poland caused the government to back down from radical anti-liberal policies and possibly contributed to the demise of that government in 1992.  Governments throughout Central and Eastern Europe were well aware of the power of IMF and World Bank recommendations.

See the New York Times, March 6, 1992, p.6.

Yet these recommendations were not backed exclusively by coercion.  There were direct private benefits to countries that embarked on reforms of their pension systems from a variety of different international agencies.  The World Bank provided loans to countries that began the reform process.  USAID provided a vast array of services to countries that ranged from writing basic laws and marking up laws for friendly members of parliament to the financing of public relation campaigns for passing reforms (Chlon, 2000).  The degree of involvement by IFIs and development agencies and their surrogates has been extraordinary for initiating, developing and passing laws associated pension reform policy.

IV. 3 Assessing the Influence of Globalization on Reforms
	Global factors influenced social welfare reform processes in Eastern Europe in part because there were multiple international agencies delivering an array of public and private goods to countries interested in undertaking reform efforts.  The existence of international public goods provided by international actors was a constant feature of the reform landscape in Eastern Europe.  Without highs level of public good provision in terms of knowledge, information and expertise, it would have been impossible for most East European transitioning governments to undertake, let alone complete the process of social welfare reform.  
	Countries that elected not to initiate any reform process could expect to bear direct costs from IFIs conditionality agreements.  Countries that elected to initiate social reform processes could expect to receive an array of direct private benefits when they undertook reforms.  Compliance with existing methods and processes developed by Western countries on pension systems also lowers the cost of implementing social welfare reforms.  These bundles of different incentives provided by international actors lead to a convergence in the behaviors of states throughout the region.  East European countries from the Danube to the Caucuses embraced social welfare reforms in their individual countries.  
Yet more importantly these incentive bundles had asymmetric influences on countries across the region as well as asymmetric influences on various domestic actors within countries.  This is crucial, since it provides a macro level account that can explain why international actors had more influence toward encouraging some countries to enact reforms in their existing pension systems and less influence on other countries.  It also suggests why convergence in behaviors did not always lead to a convergence in outcomes.  To illustrate the asymmetric influences of global factors on the development of pension reforms in Eastern Europe, suppose we consider how specific institutional design can affect policy outcomes.

V. Domestic Institutional Design and International Influences
International influences on domestic policies are not the same because of existing domestic factors in specific countries.  These domestic factors include endogenous features of the society such as the social and political attitudes of its citizens, the structure of interest group representation as well as institutional features associated with democratic governance.  How can these domestic factors affect the importance of international influences on domestic policies?  Consider a common democratic difference between Central and East European on institutional arrangements in the society.  For example, in super presidential systems or societies with only quasi-democratic functioning it may be possible to bypass a legislature.  In these cases pension or social welfare reforms may be easier to pass because of both low bargaining costs and low transaction costs. To understand this point, think of the contrast between highly centralized presidential governments compared to parliamentary systems with highly fragmented governments and slim working majorities.  
To illustrate this within the context of the problem of pension reform, consider two countries on opposite ends of their democratic transitions: Kazakhstan and Poland.  In Kazakhstan, a highly presidential system with a weak legislature, the Parliament in conjunction with the President has passed a series of World Bank sponsored reforms with little debate and virtually no interference from the Parliament (Oreinstein, 2000). By contrast, in Poland, where the need for reform has been known by policy makers and political elites since 1992-1993, reform only began in earnest in 1994 (Inglot, 1995).  This occurred only after the coalition lead by the post-communist right SLD party took firm control of the Sejm.  The weaker liberal governments (such as the Suchocka government) were unable to enact pension reform even though they may have been more ideologically disposed to such reforms.

The World Bank ultimately objected to features of the reform that was enacted.  See Rutkowski, 1998, p.17 and Spiecker and Zwiener, 1998.

Interview with Jerzy Hausner, Plenipotentiary for Pension Reform, July 8, 1998.

The problem of pension reform in democratic societies has general features that yield a structure about how democratic governments can deal with this problem effectively.  The first aspect was associated with the power of a government--both its constitutional organization and coalitional features.  When the power of a government increases, reform will be easier because new welfare proposals or new welfare cuts can be made without breaking a coalition or consulting other institutional actors.  When the power of a government decreases reforms involving welfare cuts will be more difficult because of increasing transaction costs associated with detailed bargaining among coalitions in the legislature.   These conditions will hold regardless of the global public good provided by international actors.

VI. Conclusions
This essay attempted to understand the role of international actors and global influences on the process of social welfare reform.  We saw that international actors prompted the initiation of reforms in Eastern Europe as part of the Washington Consensus.  However the special circumstances of transitioning to market created fiscal pressures on governments to solve problems associated with their existing PAYG pension systems.  Despite these positive factors, regularities associated with democratic politics suggest that pension reforms involving cuts to pensioners will in general be unlikely.  To understand these conflicting factors, it is important to analyze the elements and properties of global influences on domestic policies.
Our analysis of the global influences on domestic policies show that many different international agencies influenced the policy process.  These agencies have provided different goods that resulted in different kinds of incentive properties.  These included pure and impure public goods as well as private negative and positive incentives to East European countries.  These different bundles of incentives helped countries initiate and implement social welfare reforms.  However the effect of global influences on domestic actors is always conditioned by endogenous domestic factors, such as the institutional, social and political arrangements of different societies.  
This essay did not consider many important features of East European societies that conditioned the effects of international agencies.  Among the most important omissions was a consideration of the role of civil society and interest groups on policy formation.  These factors are likely to be essential for understanding the normative properties of global influences on a society.  In cases when democratic institutions are fragile and interest group representation weak, global influences on domestic public policy formation may be exaggerated.  This may allow global actors to be extremely effective in terms of policy outcomes, but possibly at the expense of undermining the very democratic institutions Western nations wish to promote.  By contrast when democratic institutions are relatively strong and interest group representation vigorous, global influences on domestic policy formation may be considerably less pronounced.  Yet in these cases global actors may ultimately play an extremely effective role in reinforcing democratic policy processes by empowering different domestic actors in policy debates.  

TABLES
Tab. 1
Progress of Pension Reform in 25 Transition Countries
| Fundamental Reform Program | Second Pillar Introduction | Major First Pillar Reform | Major Third Pillar Introduction
Country | In Prep | App'd | Legislt'd | In Prep | App'd | Legislt'd | In Prep | App'd | Legislt'd | In Prep | App'd | Legislt'd
Hungary | | | X | | | X | | | X | | | X
Latvia | | X | | | X | | | | X | | X |
Kazakstan | | | X | | | X | | | X | | |
Poland | | X | | | | X | | X | | | | X
Croatia | | X | | | X | | | X | | | X |
Romania | X | | | X | | | X | | | X | |
FYR Mac. | X | | | X | | | X | | | | |
Russia | X | | | X | | | X | | | | |
Slovenia | X | | | X | | | | X | | X | |
Bulgaria | X | | | X | | | X | | | | X |
Czech R. | X | | | | | | | | X | | | X
Slovak R. | | | | | | | | X | | | | X
Ukraine | X | | | X | | | X | | | | X |
Armenia | X | | | | | | | | X | X | |
Georgia | X | | | | | | | | X | | X |
Lithuania | X | | | | | | | | X | | X |
Estonia | | | | | | | | | X | | | X
Albania | | | | | | | | | X | | | X
Kygyz R. | X | | | | | | | | X | X | |
Uzbekistan | X | | | | | | X | | | X | |
Azerbaijan | X | | | | | | X | | | X | |
Moldova | X | | | | | | X | | | | X |
Belarus | | | | | | | X | | | | |
Bosnia | | | | | | | X | | | X | |
Tajikistan | | | | | | | X | | | | |

Source:  (Michal Rutkowski, 1998)

Tab. 2
Pension Spending in mid-1990s as a Percentage of GDP
Country | Year | Pension Spending / GDP | Source†
| | (percentage) |
Poland | 1995 | 14.4 | Chlon, Gora & Rutkowski 1999
Slovenia | 1996 | 13.6 | World Bank (1997g)
Croatia | 1997 | 11.6 | IMF (1998c)
Latvia | 1995 | 10.2 | Fox 1996
Hungary | 1996 | 9.7 | Palacios & Rocha 1998
Slovakia | 1994 | 9.1 | World Bank (1996b)
Czech Republic | 1996 | 9.0 | Jelinek 1997
Macedonia | 1998 | 8.7 | Wiese, 1999
Ukraine | 1996 | 8.6 | IMF (1998b)
Belarus | 1997 | 7.7 | IMF (1998d)
Moldova | 1996 | 7.5 | World Bank (1997f)
Bulgaria | 1996 | 7.3 | IMF (1998b)
Estonia | 1995 | 7.0 | World Bank (1996c)
Kyrgyz Republic | 1997 | 6.4 | IMF (1998e)
Lithuania | 1996 | 6.2 | IMF (1998a)
Russia Fed. | 1996 | 5.7 | IMF (1998b)
Uzbekistan | 1995 | 5.3 | World Bank (1997i)
Romania | 1996 | 5.1 | Von Gersdorff 1998
Albania | 1995 | 5.1 | World Bank (1998a)
Kazahstan | 1997 | 5.0 | World Bank (1998e)
Armenia | 1996 | 3.1 | IMF (1998a)
Tajikistan | 1996 | 3.0 | IMF (1998a)
Azerbaijan | 1996 | 2.5 | IMF (1998a)
Turkmenistan | 1996 | 2.3 | IMF (1998a)
Georgia | 1996 | 1.7 | World Bank (1996d)
† For sources and notes please refer to Palacios and Pallares-Miralles, 1999.

Tab. 3
Dependency ratios, mid-1990s
Eastern Europe and Former Soviet Union
| Pensioners/ | Population 60+/ | Pensioners/
Country | Contributors | Population 20-59 | Total Population
Albania | 95.3 | 18.5 | 14.8
Armenia | 38.0 | 21.7 | 16.2
Azerbaijan | 66.0 | 18.5 | 16.4
Belarus | 47.0 | 33.3 | 23.5
Bulgaria | 81.0 | 38.5 | 27.5
Croatia | 61.7 | 37.6 | 19.0
Czech Rep. | 53.0 | 31.3 | 24.2
Estonia | 60.0 | 33.3 | 25.0
Georgia | 66.0 | 31.3 | 21.1
Hungary | 78.1 | 35.7 | 27.5
Kazakhstan | 66.0 | 18.9 | 16.0
Kyrgyz Rep. | 64.0 | 18.9 | 11.7
Latvia | 65.9 | 34.5 | 25.0
Lithuania | 69.2 | 32.3 | 22.5
Macedonia | 50.0 | 22.7 | 12.4
Moldova | - | 25.6 | 17.4
Poland | 53.7 | 29.4 | 18.2
Romania | 58.3 | 32.3 | 15.1
Russia Fed. | - | 30.3 | 25.1
Slovakia | 57.0 | 27.8 | 22.0
Slovenia | 58.9 | 31.3 | 22.2
Ukraine | 78.0 | 34.5 | 27.1
Uzbekistan | - | 14.9 | 11.4
For sources and notes please refer to Palacios and Pallares-Miralles,  1999.

FIGURES
Fig. 1

Sources: Tarki (Hungary) IVVM (Czech Republic), CBOS (Poland).
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Globalization and the Development of Social Welfare Reforms
in Eastern Europe

Michael J.G. Cain^†
November 3, 2000

Comments Welcomed
Draft 1.0

Prepared for
The Annual meetings of the American Association for the Advancement of Slavic Studies, November 8-12, 2000, Denver, Colorado.

	^†St. Mary’s Collge of Maryland, Political Science Department, St. Mary’s City, MD 20686.  E-mail address: mjgcain@osprey.smcm.edu