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The "EU‐Leash": Growth Model Resilience and Change in the EU's Eastern Periphery
[journal article]
Abstract Although the EU's Eastern periphery has been afflicted by a series of crises over the past two decades, the region's dependent market economies have shown puzzling resilience. Since the global financial crisis, the FDI-led, export-oriented growth models of the Visegrád countries have been reinforced... view more
Although the EU's Eastern periphery has been afflicted by a series of crises over the past two decades, the region's dependent market economies have shown puzzling resilience. Since the global financial crisis, the FDI-led, export-oriented growth models of the Visegrád countries have been reinforced. Meanwhile, the debt-based, consumption-oriented capitalism of the Baltic states has not experienced dramatic shifts either, despite a strengthening of its export component. Scholarly accounts from a comparative political economy perspective explain this resilience as the product of country-specific factors and tend to downplay the role of external influence. Instead, we aim to bridge these approaches with international political economy scholarship by arguing that European integration, in general, and the EU's transnational regulatory influence, in particular, serves as an external anchoring mechanism for both semi-peripheral growth models. In addition to the region’s structural characteristics, such as deep embeddedness in global value chains, high exposure to trade with the EU, and dependence on external sources of finance, which already limit domestic agency in changing national growth models, we argue that European transnational regulatory integration involves an "EU-leash" that sets the boundaries for domestic economic policies, thereby influencing growth model trajectories. This ensures institutional continuity and prevents sudden and radical changes in semi-peripheral growth models. We demonstrate these mechanisms through two country studies (Estonia and Hungary).... view less
Keywords
Baltic States; Eastern Europe; EU; economic development (on national level); economic growth; export trade and industry; European integration; regulation; economic policy; Estonia; Hungary
Classification
European Politics
Political Economy
Free Keywords
Eastern periphery; Visegrád countries; dependent market economies; economic governance; growth models
Document language
English
Publication Year
2024
Journal
Politics and Governance, 12 (2024)
Issue topic
From New to Indispensable? How Has the 2004 "Big Bang" Enlargement Reshaped EU's Power Balance
ISSN
2183-2463
Status
Published Version; peer reviewed