Journal of Baltic Studies 50/4 Available Now
The last 2019 issue of Journal of Baltic Studies (Vol 50, Issue 4) is now available online. The special issue, Europeanization and financial crisis in the Baltic Sea region: implications, perceptions and conclusions ten years after the collapse contains articles on the impact of Europeanization on small North European states after 2008; financialization, distribution, and macroeconomic regimes before and after the crisis in Denmark, Estonia, and Latvia; the strategies chosen for the economic crisis management and their effects in Latvia and Poland; whether the crisis of 2008–10 has led to policy learning in financial regulation and supervision by civil servants in Estonia, Latvia, and Sweden; an ethnographic perspective on the Latvian public’s acceptance of austerity; and labor law reform and the return to “business as usual” in Lithuania. The issue also includes three book reviews and a list of recently published Baltic titles
Introduction: Europeanization and financial crisis in the Baltic Sea region: implications, perceptions, and conclusions ten years after the collapse
Leonardo Pataccini, Rainer Kattel & Ringa Raudla
The Europeanization of financial regulation and supervision on the Baltic–Nordic axis: the perspective of national bureaucracies
Egert Juuse, Ringa Raudla, Aleksandrs Cepilovs & Olga Mikheeva
This article presents a comparative case study about the impact of Europeanization on two types of small North European states after 2008. For our case study countries, this is mainly a process of Europeanization. Our analysis focuses on interpreting the Europeanization process from the perspective of bureaucracies: we attempt to understand financial bureaucracies’ perceptions of, attitudes toward, and reactions to the post-2008 developments in financial regulation and supervision in Sweden, Norway, Estonia, and Latvia. This enables us to reflect on the implementation performance and embeddedness of post-2008 regulatory and supervisory principles in these countries.
KEYWORDS: Europeanization, financial bureaucracy, financial regulation, financial supervision, Estonia, Latvia, Sweden, Norway
Since the early 1980s, financialization has become an increasingly important trend in developed capitalist countries, with different timing, speed, and intensities in different countries. Rising inequality has been a major feature of this trend. Shares of wages in national income have declined and personal income inequality has increased. Against this background unsustainable demand and growth regimes have developed that dominated the major economies before the crisis: the ‘debt-led private demand boom’ and the ‘export-led mercantilist’ regime. The article applies this post-Keynesian approach to the macroeconomics of finance-dominated capitalism of three Baltic Sea countries, Denmark, Estonia, and Latvia, both for the pre-crisis and the post-crisis period. First, the macroeconomics of finance-dominated capitalism are briefly reiterated. Second, the financialization-distribution nexus is examined for the three countries. Third, macroeconomic demand and growth regimes are analyzed, both before and after the crisis.
KEYWORDS: Finance-dominated capitalism, financialization, distribution, financial and economic crisis, Kaleckian theory of distribution
Despite many initial similarities, Latvia and Poland represent two opposite extremes in terms of practical and theoretical approaches to the economic crisis. The Polish government applied a ‘pragmatic’ approach to fight the recession, based on expansionary fiscal policies and currency devaluation. Conversely, the Latvian administration opted for the Austerity and internal devaluation strategy. Consequently, the objective of this paper is to analyze, from the perspective of political economy, the strategies chosen for the economic crisis management and their effects in Latvia and Poland, in light of the main EU narratives about its causes and responses. The research contends that the economic performance of both countries during the crisis was due to their respective economic structures. On the one hand, Poland is a bigger, more diversified and industrialized economy, with fewer channels of vulnerability and could apply expansionary policies effectively. On the contrary, the economic model established in Latvia generated a high exposure to external shocks, in particular, with a double vulnerability in the banking sector. In this context, due to internal and external motives, the Latvian government decided to apply the austerity and internal devaluation strategy, worsening the economic decline and the subsequent recovery.
KEYWORDS: Global financial crisis, Poland, Latvia, economic policies, austerity, crisis management
Policy learning from crisis in financial regulation and supervision: comparative analysis of Estonia, Latvia, and Sweden
Ringa Raudla, Egert Juuse & Aleksandrs Cepilovs
The goal of the article is to explore comparatively whether the crisis of 2008–10 has led to policy learning in financial regulation and supervision by civil servants in Estonia, Latvia, and Sweden. The article discusses how various factors can influence policy learning, including the acknowledgment of failure, blame shifting, analytical tractability of the policy problems, and the influence of external actors. We show that although the experience of the crisis varied significantly between the three countries, the policy lessons learnt are broadly similar in all three countries, due to the external influence of the European Union.
KEYWORDS: Policy learning, crisis, Estonia, Latvia, Sweden, financial regulation, financial supervision
Latvian austerity policy following the 2008 economic crisis has been touted as a success story by some and critiqued as a socially costly experiment by others. It has remained a puzzle, however, how such harsh socio-economy policies were possible without causing sustained popular protests. Drawing on ethnographic research at an unemployment office in Riga in the aftermath of the crisis, this article considers austerity as a political and moral phenomenon. I argue that welfare policies played an important role in disciplining the parts of the population most adversely affected by the crisis by framing post-crisis precarity as a matter of individual responsibility. Furthermore, this disciplining worked because it was underpinned by a particular moral discourse that I call ‘a discourse of freedom.’ Thus, this historically and culturally-shaped moral economy helped not only secure the implementation of post-crisis austerity in a way that yielded little sustained public resistance but also helped legitimate it.
KEYWORDS: Austerity, political ethnography, activation, workfare, moral economy, moral individualism, neoliberalism, Latvia
Resurgence of post-crisis neoliberalism: labor law reform and the return to “business as usual” in Lithuania
Arunas Juska & Romas Lazutka
The economic crisis of 2008–2010 revealed the extreme vulnerability of Lithuania to global financial shocks. However, instead of reforming Lithuanian capitalism, the domestic political and business elites chose to write off the enormous social and economic costs incurred during the 2008–2010 crisis as an expense of continuing doing business in a way that was typical to the pre-crisis, booming years of ‘the Baltic tigers’ (2000–2007), i.e., relying on the unstable and inequitable growth model based on foreign capital inflows and remittances, suppressing and keeping wages and taxes on capital low and exporting cheap-skilled labour to the core EU countries. We illustrate this return to business as usual in Lithuania by analyzing the political process of contestation and eventual consolidation of neo-liberal consensus among domestic political actors that resulted in the passage of the new Labour Code enabling creation of ‘flexible’ labor markets. Social and political implications of the resurgent neoliberal hegemony in post-crisis Lithuania are discussed.
KEYWORDS: Neoliberalism, labour code reform, post-crisis, Lithuania
BOOK REVIEWS AND RECENT PUBLICATIONS
History of Lithuania: from medieval kingdom to modern democracy
by Bronius Makauskas and Vytautas J. Černius, Shirley, NY, Lithuanian American Community, 2018, 686 pp., $50.00 (hardback), ISBN 978-0-692-23645-1
Virgil I. Krapauskas
Narratives of exile and identity: Soviet deportation memoirs from the Baltic countries
edited by Violeta Davoliūtė and Tomas Balkelis, Budapest, Central European University Press, 2018, 220 pp., $60 (hardback), ISBN 978-963-386-183-7
Baltic socialism remembered: memory and life story since 1989
edited by Ene Kõresaar, London, Routledge, 2018.154 pp., ISBN 978-1-138-56005-5
ABOUT THE JOURNAL
Journal of Baltic Studies (JBS), the official journal of AABS, is a vital source of scholarship for those engaged in Baltic state and Baltic Sea region studies. JBS is a peer-reviewed, multidisciplinary journal published on a quarterly basis that aims at progressing and disseminating knowledge about the political, social, economic, and cultural life – both past and present – of the Baltic states and the Baltic Sea region. JBS seeks high-quality original articles and review of broad scholarly interest that advance knowledge of the Baltic states and Baltic Sea region.
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