Evolutionary Institutional Change for Sustainable Rural Livelihoods in Central and Eastern Europe

At the Berlin MACE (Modern Agriculture in Central and Eastern Europe) Conference in January 2007, I offered some general thoughts on the crafting of institutional arrangements to further the economic transformations now underway in Central and Eastern Europe. In that paper I observed that many countries are now in the “third wave” of institutional change [Bromley, 2007]. The first wave began during the collapse of the old order starting around 1992. A decade later the second wave was induced by pressure to accede to the European Union. I observed that it now seemed appropriate to reflect on these two waves of forced institutional change. In other words, to what extent do these imposed institutional regimes reflect local needs and local preferences as we look into the future? More profoundly, to what extent do these imposed institutional regimes provide the basis for economic and political sustainability over the long run? I offered a general outline of the political and economic processes that are necessary to assure an ongoing process of institutional change that will conduce to the sustainability of economic reforms in the region. I called this the third wave of institutional reform in Central and Eastern Europe. We know that the economies of Central and Eastern Europe began to experience a gradual “institutional thaw” as perestroika and glasnost spread outward from the Russian core of the former Soviet Union. In November 1989, with the fall of the Berlin Wall, the changes picked