Three Converging Literatures of Transnationalization and the Varieties of Transnationalization: Introduction

Two decades after the fall of the Berlin Wall, we are witnessing an ever quickening dissolution of the boundaries among internal and external actors in the countries of Europe and the factors inducing domestic institutional change. If one takes the example of the 10 new Eastern and Central European member countries of the European Union, these countries best exemplify one new pattern of change that we discuss in this book. In the economies of these countries, international cross-ownership networks play a growing role (Bohle and Greskovits 2007; Stark and Vedres 2006). While 80–90% of the banks are in foreign ownership in the region, foreign companies also own key parts of the manufacturing sectors, and many of the firms in these sectors form part of transnational production chains. These economies are governed by states that share ever larger parts of their regulative powers with nondomestic actors (Bruszt and Stark 2003). As a condition of joining the European Union, these countries had to adopt tens of thousands of pages of EU regulations, ranging from rules of competition to state aid, environmental regulations and food safety regulations to institutions of corporate governance. The great quantity of rules of nondomestic origins has increased further with the participation of these states in diverse regional and global institutions with standard-setting and rule-making functions ranging from WTO and ILO to specific multilateral agreements.