IDEAS home Printed from https://ideas.repec.org/a/liu/liucej/v21y2024i2p167-210.html
   My bibliography  Save this article

The boulevard of broken dreams? Long-run effects of labor-managed socialism

Author

Listed:
  • Rok Spruk, Mitja Kovac, Nuno Garoupa

Abstract

This study investigates the long-term impact of socialism on economic growth, focusing on the unique case of labor-managed socialism in former Yugoslavia. By comparing Slovenia with OECD and East Asian donor countries that did not undergo postwar socialist transitions, we estimate counterfactual scenarios using synthetic control methods. Our findings show that labor-managed socialism led to a temporary growth deviation, followed by a structural collapse in the 1980s. Our estimates suggest that Slovenia’s per capita GDP would be 22 percent higher today had there been postwar economic and political liberalization in place. By contrast, if socialist policies had continued after 1990, Slovenia's per capita GDP would be 63 percent lower today. These results remain robust across various robustness checks.

Suggested Citation

  • Rok Spruk, Mitja Kovac, Nuno Garoupa, 2024. "The boulevard of broken dreams? Long-run effects of labor-managed socialism," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 21(2), pages 167-210, December.
    • Handle: RePEc:liu:liucej:v:21:y:2024:i:2:p:167-210
    as

    Download full text from publisher

    File URL: https://ejce.liuc.it/articles/ejce031.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    socialism; economic growth; synthetic control method; comparative long-run development; Slovenia;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • P51 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:liu:liucej:v:21:y:2024:i:2:p:167-210. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Laura Ballestra (email available below). General contact details of provider: https://edirc.repec.org/data/liuccit.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.