Globalization Under and After Socialism: The Evolution of Transnational Capital in Central and East Europe by Besnik Pula (review)

It is indeed a rare occasion when an author of mainstream credentials with an institutionalist perspective lodged in the international relations tradition to provide an unconventional analysis of global political economic developments that call into question long-held views that shaped the postwar understanding of East-West relations emanating from the Cold War between the United States and the former Soviet Union, and by extension the political economy of Central and East European states that were part of the socialist bloc until the end of the 1980s, when epochal socio-political changes ushered in a period of social and economic transformations that altered the geopolitical landscape of a region that came to exemplify the latest manifestations of neoliberal capitalist globalization at the end of the twentieth and the beginning of the twenty-first centuries.

Besnik Pula's pioneering research and analysis of this unfolding process in an important region of the world provides us with a fresh new look at the roots of the transition from socialism to capitalism in Central and Eastern Europe as we come to understand the dynamics of this transition that has transformed the region in a neoliberal capitalist direction fully integrated into the global capitalist economy under conditions of contemporary global capitalism.

In his recent book Globalization Under and After Socialism: The Evolution of Transnational Capital in Central and Easter Europe, Pula provides us a comparative-historical institutional analysis of the transformation of Central and Eastern European economies using an innovative and heretofore ignored process at work that he claims provided the foundations and set into motion the economic transformations that took place in the aftermath of the collapse of the former Soviet Union and its allied Central and East European socialist states. His provocative argument that the seeds of post-socialist economic transformations in Central and Eastern Europe were in fact planted during the socialist period when a succession of socialist regimes and leaders presided over massive industrialization and socialist economic development, which established the framework for subsequent economic relations with capitalist states in Europe and elsewhere and played a key role in their success in facilitating the transition to neoliberal capitalist economies that transformed these socialist states into capitalist ones following the political uprisings that swept away socialism and communism in this region, is an important corrective that needs to be considered to explain the epochal changes in Central and Eastern Europe that have greatly impacted the balance of forces in the global political economy in the late twentieth and early twenty-first century.

In the opening paragraph of his book, Pula writes: "The reigning image of state socialist economies as they existed during the second half of the twentieth century is that of fully closed, autarchic systems. Today, by a number of measures, including dependence on foreign direct investment (FDI), export specialization, and the dominance of transnational corporations (TNCs) in the local economy, the ex-socialist economies of Central and Eastern Europe are among the most globalized in the world." He goes on to ask: "Was the socialist past merely an obstacle these countries needed to overcome to join the global economy? Or, did socialism instead lay the groundwork for the region's present-day globalization?" He says his book tackles this puzzle "through an analysis of institutional reform and globalization in the East-European ex-socialist economies from the 1970s through the first decades of the twenty-first century." His conclusion? "This book aims to argue precisely that... trade and reform policies during the socialist period created the organizational and institutional basis for the region's economic globalization in the 1990s and 2000s, and that history has much to do with where these states stand today in the global economy."

While Pula's argument regarding the role of socialist industrialization in Central and Eastern Europe during the period of the Soviet-led socialist bloc...