What explains the generosity of unemployment insurance in Central and Eastern Europe? How to explain policy outcomes that seemingly contradict the logic of the institutional environment they are embedded in? Among post-Communist EU Member States such residual welfare states as Estonia, Latvia or Bulgaria boast relatively generous unemployment insurance regimes, whereas two of the most generous post-Communist welfare states, Poland and Hungary, have the most residual ones. According to standard theories on the welfare state and varieties of capitalism we would expect Poland and Hungary having generous unemployment insurance regimes with their high-value added manufacturing export industries and their strong left-wing governments and relatively high union density levels (at least in the first two decades after the collapse of Communism and compared to the Baltic states).
In the seminar, Rafael Labanino will discuss the cause of this counter-intuitive outcome. Abnormal pensioner booms, which took place most notably in Hungary and Poland – that is, letting masses of redundant workers of the collapsed Communist industries into early and disability pensions – are identified as a necessary condition for residual unemployment insurance regimes and relatively generous pension systems in the post-Communist context. Using a political institutionalist framework and based on a new comparative qualitative dataset of economic and social policy reforms, i.e. the Liberalisation Dataset 1973-2013, he will present the findings from the critical cases analysis which meticulously followed the politics of unemployment and pension reform processes in Bulgaria, Estonia, Hungary, Latvia and Poland. The author will discuss how in a relatively short period, political decisions made at a critical juncture in history can lock in distinctive policy pathways in the long run.