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- De facto states in the post-Soviet space lack international recognition and strong state structures, but survive in large part due to Russian aid, as Russia has a strategic interest in these regions.
- Any credible effort to reunify the de facto states with their parent states would require tackling pervasive corruption and criminal markets, and must also take into account ethnic and historical grievances that make reunification challenging.
- Economic relations and deeper trade ties, such as are emerging between Moldova and Transnistria, may offer hope for compromise, and could help formulate an approach to Ukraine’s relationship with Donbas.
The 1990s in Serbia were marked by war, uncertainty, and illegal rentseeking. Those who took advantage of the system profited, and thus supported the status quo of Slobodan Milošević’s regime. However, once Milošević was removed from office, the outward veneer of stability in Serbia crumbled and citizens were forced to face the legacy that Milošević had left behind. Initially, the influence of Milošević’s allies was stymied and reform proceeded at a rapid pace, with positive results.Read more...
Globalization has redefined the global system, as the old concept of First World, Second World, and Third World is no longer valid. New players have joined the global economy and will have significant influence on how it will develop in the coming years. From the business perspective, globalization is not about analyzing pros and cons, but about understanding its impact and properly responding to it. This response should be thought of as a rules-based system that is currently under construction. Development of these rules should not be left to governments – business has to be at the table where the decisions are made. If it fails to do so, the business community will end up living in a system of rules that it never built, but was created by someone else. And this is true for businesses regardless of industry or location, as the need to actively participate in the development of an international system of rules applies equally to businesses from developed and developing countries. In the end, for the private sector, globalization is about creating a business-friendly environment, both on a local level and globally.Read more...
In his interview with CIPE, Francis Fukuyama discusses the importance of having a strong, efficient state and talks about the development agenda in the light of his recent work, State-Building: Governance and World Order in the 21st Century. This book builds on the idea that there are two crucial dimensions of the state, scope and strength, and evaluates the challenges of state-building and finding the right balance between the two dimensions.Read more...
Afghanistan’s current development agenda is part of a reconstruction process that is intertwined with the elements of state-building – physical reconstruction, national security, political stability, and human rights issues. A major weakness of the current state-building/reconstruction process is its lack of emphasis on Afghan ownership. So far, external influence and engagement have been dominant, both in policy design and policy implementation. To this point, policy has been made behind closed doors, and there is no transparency in communicating subsequent policies to the Afghan public.Read more...
Economic theory has developed two basic views of corruption, one that considers corruption to be exogenous and the other endogenous to the political process. Applying either theoretical view, three basic types of corruption can be identified: corruption for the acceleration of processes, administrative corruption, and “state capture.” While in most cases, corruption can be attributed to rent appropriation, self-interested individuals seeking to maximize their own personal welfare as well as complicated, ambiguous, and unenforceable laws are also to blame.Read more...
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CIPE welcomes articles submitted by readers. Most articles run between 3-7 pages (1000-3000 words), but all submissions relevant to CIPE's mission of building accountable, democratic institutions through market-oriented reform will be considered based on merit. Economic Reform Feature Service articles are primarily geared toward an international, non-academic community of businesspeople, economic reformers, and policy-makers. Specific policy recommendations and articles based on direct experience are encouraged. In addition to articles, we are willing to adapt suitable lectures, speeches, research notes, and academic papers.
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