The main theme of this study is the political economy of policy reform in less developed countries and post-socialist countries. Given the complexity of economic development and transition, Joachim Ahrens views failures in policy reform, poor public sector management, rent-seeking, corruption, and over-centralization as systematic, though not exclusive, instances of institutional failure. This interdisciplinary study looks for ways of constructing effective market-enhancing governance structures that provide appropriate incentive systems to cope with such failures. No blueprint is offered, but the book provides a conceptual governance framework that can be applied in a comparative way to analyze economic, political, and social obstacles to policy and institutional reform. The concept is not only used to analyze the politico-institutional foundation of policy reform in East Asia and Eastern Europe, but it also allows to elaborate country specific strategies to craft institutional safeguards that help overcome impediments to development and transition.

This innovative book, which overcomes the conventional perspective of a government-market dichotomy, will be of interest to researchers, students, policymakers and all those concerned with the impact of the dialectic interaction between political and economic forces on economic development.