THE LEFT OR THE RIGHT? THE POLITICAL LOGIC BEHIND THE ECONOMIC POLICIES OF THE COMMUNIST SUCCESSOR PARTIES IN CENTRAL EUROPE

Abstract

In years following the regime change in central Europe, many communist successor parties (CSPs) have adopted relatively right-wing economic platforms. This paper explores why, upon entering the game of electoral competition, the CSPs have staked right-wing economic positions – as if trying to alienate the potential electorate among the have-nots of the post-communist transformations. Specifically, I propose that CSPs' economic policy is more representative of the interests of the parties' financial donors, rather than the electorate at large. I test this proposition by analyzing the stance that CSPs take towards signing of bilateral investment treaties (BITs). By attracting foreign investment, BITs change the competitive landscape of a host country in ways that are not always beneficial to the domestic companies, owned by supporters of CSPs. Therefore I expect CSP-controlled governments to be hesitant about signing BITs. The results of the statistical investigation support such a hypothesis, as well as the larger claim of the paper, namely, that the economic policy of the communist successor parties is primarily geared towards representing the interests of their financial supporters.