QuoVadis,Slovenia?
BetweenFrameworkConditions
andInternalCapabilities
BorutRonˇ cevi´ c,JanezŠušteršiˇ c,PeterWostner,
andTamaraBesednjakValiˇ c
We consider the new eu member states as semi-peripheral coun-
triesstanding at the developmentcrossroads. We emphasizethe socio-
cultural factors of development,presenta model for bringingtogether
severalcultural and social influences,and testits validity byapplyinga
fuzzy-set methodology, a rather novel approach in social sciences. We
augment our analysis of internal socio-cultural factors by considering
the likely changes in the external framework conditions. Focusing on
demography,technology,andglobaleconomicandpoliticalstructures,
we outline possible scenarios for European development that will cer-
tainly affect the chances of individual countries. As our contribution,
wediscusstheinterplaybetweensuchframeworkconditionsandinter-
naldevelopmentcapabilitiesanddrawsomeimplicationforthecaseof
Slovenia.
Key Words: development,socio-culturalfactorsofdevelopment,
long-runscenarios
jel Classification:e66 ,o10 ,o20 ,z13
Introduction:StandingattheDevelopmentCrossroads
Catching-up of transition countries with the old eu member states is
mostly considered in terms of economic development, bothin the sense
of the target indicator (gdp per capita levels in terms of purchasing
power parity) and the key development drivers (physical and human
DrBorutRonˇ cevi´ cisDirectoroftheUniversityandResearchCentre,
NovoMesto,andanAssociatedProfessorattheSchoolofAdvanced
SocialStudies,NovaGorica,Slovenia.
DrJanezŠušteršiˇ cisanAssociatedProfessorattheUniversityof
Primorska,FacultyofManagement,Slovenia.
PeterWostnerisDeputyDirectoroftheGovernmentOfficeforLocal
Self-GovernmentandRegionalPolicy,Slovenia.
Tamara Besednjak Valiˇ cisaTeachingAssistantattheSchoolof
AdvancedSocialStudies,NovaGorica,Slovenia.
ManagingGlobalTransitions8 (4 ):353 –380

354 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
capital investment, technological innovation, economic reforms).¹ It
is expected that real convergence, understood along the lines of Barro
(1991 ), will inevitably take place once the proper policies and economic
structures are in place. Dissenting views are rare. An interesting exam-
ple is that of Cheshire and Magrini (2000 ), who analyze the evolution
of regional per capita incomes on the basis of the empirical growth
model combined with the Markov chain method. Their results point
to an inherent trend of increasing divergence both within the group of
poorer regions in Europe and, especially, between the poorer and richer
regions.
In this paper, we take a broader perspective on transition countries’
development. In our view, the new eu member states are standing at
the development crossroads. They are considered as semi-peripheral
countries, whose competitiveness hinges on infrastructure investment
(in terms of material, institutional, and informational infrastructure),
upgrading of production programmes and leadership of enterprises
(Sofian 2001 as cited in Ronˇ cevi´ c 2007 , 221 ). We add to this perspec-
tive the importance of socio-cultural development factors. We present a
model bringing together several cultural and social influences and test
itsvaliditybyapplyingafuzzy-setmethodology,arathernovelapproach
insocialsciences.
Taking a broader perspective on convergence implies that one is nec-
essarily dealing with long run issues. This takes us from the world of
economic forecasting to the world of building long–run development
scenarios. We therefore augment our analysis of internal socio-cultural
factors byconsidering the likely changes in theexternal framework con-
ditions.Focusingondemography, technology, andglobaleconomicand
politicalstructures,weoutline possiblescenarios forEuropean develop-
mentthatwillcertainlyaffectthechancesofindividualcountries.Asour
contribution, we discuss the interplay between such framework condi-
tions andinternal development capabilities.
When drawing the implications of our analysis, we focus on Slovenia
as an example of a country to which our framework applies. Slovenia is
generallyconsideredasoneofthesuccessstoriesoftransition.Thecoun-
try achieved one of the highest average growth rates among the eu ac-
cession candidates, and its economic growth was by far the least volatile
among transition countries. Moreover, this stable and reasonably high
growth rate was achieved without major macroeconomic imbalances.
Regarding social and political developments, Slovenia’s unemployment
ManagingGlobalTransitions

QuoVadis,Slovenia? 355
table 1 TheofficialvisionforthechangeinSlovenia’sdevelopmentmodel
CurrentDevelopmentModel VisionoftheNewSocial Development
Model
Regulationandbureaucratisationof
markets
Deregulationandliberalisationofmarkets
Restrictivebusinessenvironment Promotingenterprisecreationandgrowth
Relativelyclosedfinancialmarkets Openandcompetitivefinancialmarkets
Insufficientflexibilityofthelabourmarket Amoreflexiblelabourmarket
Collectivesocialsecuritysystem Individualneedsandresponsibility
Corporatismoflargesocialpartners Open,broad-basedpartnerco-operation
Bureaucratic,hierarchicalpublicsector Decentralisation,publicprivate
partnership
Focus onmacroeconomicandsocial
balances
Focusonsustainabledevelopmentbased
onstructuralreformsandadynamic
society
notes Adapted from imad2005 .
and poverty rates were both below the eu average. Spending on social
benefits, as apercentage ofgdp ,wasalsocomparable totheeu average,
indicating preservation of a rather generous welfare state. Comprehen-
sivesocialpartnershipinstitutionsalsohelpedpreventing socialunrest.²
WidespreadoptimismregardingSlovenia’sdevelopmenthaswanedin
recent years. A number of economists took the opinion that incomplete
economic transition created significant structural inefficiencies with
negative impact on the country’s competitiveness. This was reflected
intheslowdownofeconomicconvergence,ascomparedtoseveralother
transition countries. Weakening economic competitiveness made it in-
creasingly difficult to finance the welfare state and to provide workers
with wages above subsistence.³ Such a critical view has been taken up
in official documents. For example, Slovenia’s Development Strategy
(imad 2005 )⁴ has set out a thorough change in the country’s develop-
ment model, as presented in table 1. Our approach in this paper will
helpusshedsomelightontherealismofsuchatargetandthenecessary
conditions forachieving it.
In the next section, we present a theoretical model of internal socio-
culturaldevelopmentfactorsandtestitsvaliditybyapplyingittoasetof
European countries. We continue by considering different scenarios for
broad framework conditions and conclude by drawing up the implica-
tionsandconclusionofouranalysis.
Volume 8 · Number 4 · Winter 2010

356 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
InternalFactorsofDevelopment
We understand internal development factors in terms of the capacities
of a country to deal with challenges imposed by changes in external
framework conditions. We focus on the less tangible socio-cultural fac-
torsofdevelopment,whichwereonceignored,butbecamepopularafter
the ‘cultural turn’ at the end of the 1980 s. At that time, and under the
weightofempiricalevidence,socialscientistsstartedtodealwiththerole
of non-economic factors of development. These studies focused mostly
on Japan and the four Asian tigers (South Korea, Hong Kong, Taiwan
and Singapore). We examine in what way these factors play their role
in achieving a development breakthrough and in what way we need to
considertheminshapingdevelopment policies.⁵
theoreticalstartingpoints
The idea of socio-cultural factors of development is far from being new.
Max Weber’s well known Protestant Ethics and the Spirit of Capitalism
(2001 ) emphasised the role of non-economic factors in economic de-
velopment. The awareness of such a connection is also found among
classical and neo-classical economists, starting with Adam Smith, and
continuing with Alfred Marshall (Adam et al. 2005 ). We must also note
the important role of Talcott Parsons, who partially followed Webber in
shapinghisideas onculturalfactorsofsocialdevelopment.
Amongcontemporaryeconomists,aprominentroleisthatofMichael
Porterwhointroducedtheconceptofcompetitiveadvantagesofnations,
pointing out that achieving competitiveness is a highly complex and lo-
calised process depending on many direct and indirect factors, such as
economicstructures,qualityofgovernance, values,culture,andpastde-
velopment. Insociology,thefocusshiftedfromsimpletoreflexive mod-
ernisation and new forms of societal coordination related to this shift.
In the theories of Anthony Giddens, Ulrich Beck and Helmut Wilke a
particular roleis attributed toknowledgeandforms ofdevelopment co-
ordinationwithinextremelycomplexmodernsocieties.Suchapproaches
enable us to move beyond the old dilemmas of primacy of the free mar-
ketversusthestate(Adametal.2005 ).
Several studies consider successful cases of countries that achieved
a development leap. They show that development processes can be
speeded upbyanumberoffactors,butthatmostofthemareconnected
toaspecificenvironment.Wespeakofcontextualspecificprocesses(Kim
and Nelson 2000 ;O’Hearn1998 ;Battel2003 ;Walsh1999 ; O’Riain 2000 ;
ManagingGlobalTransitions

QuoVadis,Slovenia? 357
CastellsandHimanen2002 ).Thatiswhyitisverydifficulttopredictthe
long-term consequences (success)ofspecificpolicies.
What are these necessary conditions that enable countries or regions
to respond to developmental challenges? Berend points to the impor-
tance of trans-nationalisation, connected with privatisation and mar-
ketisation, in his analysis of the recent Irish success story and of the
Mediterranean ‘miracle’⁶ (Berend2001 ).Tofocus on Ireland, we can say
thatthemassiveinflowoffdi –fosteredbyeasyaccesstotheeu market⁷
and a well-educated and relatively cheap labour force –, the know-how
related to fdi , and the massive influx of money from eu Structural
Fundsplayedanimportantrole(O’Hearn1998 ).Buthadthisfdi inflow
not been accompanied with internal qualitative changes (increased edu-
cation,institutionalefficiency,etc.),itwouldonlyhaveservedtoconsol-
idate the relatively unfavourable position of Ireland in the international
division of labour. That would happen if the fdi were located primar-
ily in the extraction sectors or if their primary purpose were to expand
their own business and gain market shares in new, ‘virgin’ markets. The
beneficial spillover effects are not possible without internal structural
changes. Hence, we can argue that internationalisation and a massive
influx ofcapitalisanecessarycondition. Butitisnotsufficient.⁸
In an earlier work on industrialisation and formation of the Euro-
peanperipheryinthe19 thcentury(BerendandRanki1982 ),Berendand
his coauthor offered a much more refined, systematic and holistic anal-
ysis of development factors. They outlined socio-political prerequisites
of change, human factors, the role of the state, the integration into the
world market, foreign trade and export branches. These factors may be
groupedasinternal(thefirstthree)andexternal(thelasttwo).Whileitis
clearthatwithoutexternalfactorsacountrycannotsuccedinjoiningthe
group of affluent, developed countries (unless it undertakes a long and
uncertain process of own capital accumulation), their analysis makes a
strong point that internal factorsare crucial determinants of a country’s
positionintheinternational system.
Van Rossem also showed that development is not exclusively a conse-
quence of the international environment, i.e. thepositioning of acoun-
try towards others. Although the international environment imposes
constraints on countries,especially on the economically backwardones,
it does not solely determine the dependency and developmental perfor-
manceofacountry.Hisconclusionisthat‘internalsocial,economic,and
political structures and actors become vital factors in development, and
Volume 8 · Number 4 · Winter 2010

358 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
can modify the effects of the international environment’ (van Rossem
1996 , 524 ). To put it simply, the basic preconditions for developmental
performanceareendogenous,butweshouldtaketheinputfromtheen-
vironment into account. This is also the starting point of the model of
socio-culturalfactorspresented inthenextsection.⁹
Despite lagging behind, Eastern European countries developed spe-
cific forms of modernisation. Its impulses were rarely endogenous. If it
happened,modernisationwasdeformedorpartial.Industrialisationwas
notpromoted byanewcapitalistsocialclass,thebourgeoisie,butrather
bythearistocracy asanattempt topreserve itsprivileged position.Con-
sequently, processesof functional differentiation, with a specialised eco-
nomic subsystem as a result, did not take place. Production processes
were therefore less efficient and did not operate with the same logic as
in the earliest industrialised countries.¹⁰ Partial forms of modernisation
continued in the second half of the 20 th century, which led to specific
formsofmodernisation, whichonly metsome conditionsofmodernity.
This is whysomeauthors labelled themas ‘by-modernity’ (Bernik1989 )
or‘deformed modernity’ (Adam1989 ).
aheuristicmodelofsocio -culturalfactors
ofdevelopment
Theimportanceof‘intangible’factorshasbeenrecognisedforsometime
now.¹¹ They were mainly dealt with in a relatively intuitive way¹² or at
a purely theoretical level (Swidler1986 ). Some authors attempted at so-
phisticatedcalculationsofrelationsbetweenculturalandeconomicvari-
ables,buttheirconclusionsweremarkedaspreliminary(GranatoIngle-
hart and Leblang 1996 ; Swank 1996 ). An integrated conceptual frame-
work for comparative evaluation of specific development factors is still
lacking.
In our own research, we have developed a robust and holistic model
incorpotating the socio-cultural factors into analysis of developmental
performance(seeAdametal.2005 ; Adam and Ronˇ cevi´ c 2004 ). The
model has applied aspects as well, as it can point to specific factors that
hinder development, thereby enabling the formulation of targeted poli-
ciesforsustained development.
The model has three levels. The third level is developmental perfor-
mance, which is a resultant of interaction between different factors and
their mutual influence; in other words, it is a result of developmen-
tal processes. Definition and operationalisation of this level depends to
ManagingGlobalTransitions

QuoVadis,Slovenia? 359
someextentonspecificresearchinterestsoronsocial,politicalorstrate-
gic goals. As an example of politically defined strategic goals, we can
imagine a semiperipheral East-Central Europe country setting itself the
goal of achieving a developmental breakthrough and joining the group
of core European countries.
Developmental performance depends on a group of factors, which
constitute the first and the second level of our model. The first level is
built on sedimentation of past developmental trajectories and experi-
ences(historymatters).Wetermthisfactorascivilisationalcompetence.¹³
It is a ‘latent structure of cognitive, normative, expressive and motiva-
tionalelements whichenableindividuals andsocialcommunitiestoori-
ent themselves in the different subsystems of modern (or modernising)
societies’ (Adam et al. 2005 , 24 ). The concept of civilisational compe-
tenceisbasedontwocivilisingprinciples,self-control(self-imposeddis-
cipline)andself-initiative (activeparticipation) (Elias1994 ).
The second and central part of the model consists of current and
prospective factors of development. They are divided into internal and
external ones. The former include cognitive mobilisation, entrepreneurial
spirit, quality of governance, social cohesion and social capital. The latter
include openness (internationalisation), implying both rational utilisa-
tionofforeignresources(suchasforeigndirectinvestmentsorstructural
funds) and active adaptation to the environment, which by definition is
morecomplexthanthesystem(society)itself(Heylighen1992 ).
Internal current and prospective factors of development are in the
focus of our research, as these are ‘the most easily’ influenced by spe-
cificpolicies.Theconceptofcognitivecompetenceswasdevelopedtotake
into account the strategic role of knowledge for systemic competitive-
ness, as emphasized by the literature on human resources and human
capital. The importance of entrepreneurial spirit in development is also
well-recognised. Some aspects of this subject have already been studied
by Max Weber. We developed our concept to take into account relevant
conditions for the creation of new opportunities or even to anticipate
theseopportunities andreacttochangesinthebusinessenvironment.
Moreover, one has to take into account the regulatory framework,
as institutions affect enterprise performance (de Soto 2000 ). Quality of
governance is hence an important factor of development. It can be ex-
pressed in a variety of ways, e.g. as protection of property rights, the
administrative burden, the coordinative role of the state, support for
consensus-building and its implementation through democratic proce-
Volume 8 · Number 4 · Winter 2010

360 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
Social capital
Qualityof
Governance
Entreprene-
urialspirit
Social
cohesion
Cognitive
mobilisation
Internalfactors Externalfactors
History
matters
Current and prospective factors
ofdevelopment
Openness
(internationalisation)
Developmental
performance
Civilisational
performance
figure1 Theheuristicmodelofsocio-culturalfactorsofdevelopmental
performance(adaptedfromAdametal.2005 )
dures, contextual intervention, regulation. Social cohesion, as another
important factor ofdevelopment (Ritzen and Woolcock2000 ),doesnot
imply a monolithic and undifferentiated society. Instead, it implies sol-
idarity, meaningful identities and participation. It enables mobilisation
andutilisationofbroaderpotentialsandcontributestoconsensusbuild-
ing,whichisdifficultinasocietywithahighlevelofsocialexclusion,ex-
tremeinequalitiesandanomie.Highlycohesivesocietiesaremoreprone
tosustaineddevelopment.
The role of current and prospective factors of development depends
on the organisation and utilisation of synergetic potentials. This is why
social capital holds the central position within the model. We have to
be careful when applying this concept (see Adam and Ronˇ cevi´ c 2003 ),
but it can be effectively used in analysis of coordination and consensus
building, reduction in transaction costsetc. Itenables synergies of other
currentandprospectivefactors.
verifyingthemodel :afuzzy -setanalysis
We shall attempt to verify the model by applying the fuzzy-set method-
ology for social sciences as developed by Charles Ragin (2000 ). This
ManagingGlobalTransitions

QuoVadis,Slovenia? 361
methodiswidelyappliedinhardscienceswhendealingwithproblemsof
engineeringinfaceofambiguityandcomplexity.Onecanhardlydispute
that the problems we are dealing with in many social sciences are any-
thing but ambiguous and complex, including the analysis of the factors
of development of societies. The application of this analytical approach
wouldseem appropriate fromthisperspective.
Furthermore,itisimportantthatfuzzy-setmethodologyprovidesthe
researcherwith‘interpretativealgebra,’anapproachthattakesbothcon-
ceptual andmathematical-analytical aspects intoaccount, thus enabling
social scientists to employ a dialogue between ideas and empirical evi-
dence, the much-desired systematic interplay between theory and data.
According to Ragin (2000 , 5–6 ), it is possible to become involved in a
much richer dialogue with fuzzy-set analysis than with ‘conventional’
analytical procedures for three reasons. Firstly, with fuzzy sets one can
avoid problems with the usual homogenising assumptions in the analy-
sis of large populations, and this allows for an analysis of smaller pop-
ulations, such as ours (27 countries). Secondly, fuzzy sets can be used
to enhance diversity-oriented research. This is potentially important in
the context of our analysis, due to the fact that ‘each latecomer has its
own story’ on the specific form of its development. Were there a dif-
ferent combination of necessary conditions, it would be important for
our analysis to point to them. Finally, fuzzy sets can be carefully tai-
loredtofittheoreticalconcepts.Thisisagainanimportantaspectofour
analysis.
Tostart the analysis we mustfirst specifythe relevant domains. These
wouldhavetobetheoreticallyjustifiedincertaincases,butinouranaly-
sisdomainsaredeterminedbyourresearchinterestandthefocusofour
analysis.Wehave27 relevantdomains,namelytheeu memberstates(ex-
cluding Luxembourg, Cyprus and Malta), twoefta countries (Switzer-
landandNorway)andRussia.
In Adam et al. (2005 ), fuzzy sets have been precisely defined as differ-
entsocio-culturalfactorsanddevelopmentalperformance.Eachcountry
wasassignedmembershipineachset.Thismembershipisanywhere be-
tween1 (indicatingfullmembershipinasetofe.g.developedcountries)
and0 (indicating non-membershipintheset).Onecanalsodecide ona
certain number of anchors and thus limit available membership scores.
We have decided to opt for three anchors. In addition to full member-
ship and non-membership we also assigned partial membership (value
0 .5). We used the following sets of data to assign membership scores to
individual countries:
Volume 8 · Number 4 · Winter 2010

362 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
 civilisational competence was measured on the basis of the level of
modernisation(thisreferstopolitical,economicandsocialchanges
occurring since the 19 th century) and the geo-political position,
with highly modernised countries named as corecountries andthe
restdetermined regardingtheirgeo-politicalpositionandborders;
 entrepreneurial spirit was evaluated on the basis of the Total en-
trepreneur activity index, Cluster innovation environment index,
Businessr &d intensity, andIndexofeconomic freedom;
 quality of governance was evaluated regarding Political rights and
civil liberties ratings, the Voice and accountability index, Political
stability index, Government stability index, Rule of law index, and
theCorruptionperceptionindex;
 social cohesion was evaluated on the basis of Share of income and
consumption,Solidarityindex,andNumberofsuicidesper100 .000
people;
 evaluation of the level of social capital was undertaken by compar-
ing Generalized trust, Active involvement in voluntary associations
andSpendingtimeinclubsandassociations;
 internationalisation was scored by taking into account Inward for-
eigndirectinvestments ingdp andExternal trade ratiostogdp .¹⁴
On the basis of this procedure, we were able to assemble the data for
fuzzy–setanalysisinaspreadsheetpresented intable2.
resultsofthefuzzy -setanalysis¹⁵
Afterhavingformedthefuzzysetspreadsheet,wecanattemptanempir-
ical verification of the model of socio-cultural factors of developmental
performance. We can test relationships between the three levels of the
model.Firstistheimpactofthelevel‘historymatters’onthelevelofcur-
rent and prospective factors. If our model is correct, the analysis would
have to showthat civilisational competence is a necessary causeof other
factors.
According to the results of regression analysis, as presented in table
3, civilisational competence is usually the necessary cause of other fac-
tors of developmental performance, with the exception of the quality of
governance. Looking at the data in table 2,wecanseewhythisisthe
case. Across a range of countries, membership in the fuzzy–set ‘qual-
ity of governance’ exceeds their membership in the set of ‘civilisational
competence.’ This is a consequence of democratisation in a number of
ManagingGlobalTransitions

QuoVadis,Slovenia? 363
table 2 Fuzzy–setspreadsheet
Country dp cc sc cm qges coh op
Belgium 11111111
Denmark 11111111
Finland 11111111
Netherlands 11111111
Norway 11111111
Sweden 11111111
Austria 1111110 .51
Germany 1111110 .51
Switzerland 1111110 .51
u k 1111110 .51
Ireland 10 .511110 .51
France 110 .51110 .50 .5
Italy 110 .50 .50 .510 .50 .5
Spain 0 .50 .50 .50 .510 .50 .50 .5
Portugal 0 .50 .500 .510 .50 .50 .5
Czech R. 0 .50 .50 .50 .50 .50 .50 .50 .5
Slovenia 0 .50 .50 .50 .50 .50 .50 .50 .5
Estonia 0 .500 .50 .50 .50 .500 .5
Hungary 0 .50 .500 .50 .50 .500 .5
Greece 0 .50 .50 .50 .50 .500 .50 .5
Slovakia 0 .50 .50 .500 .50 .510 .5
Poland 0000 .50 .5000
Latvia 00000 .5000 .5
Lithuania 00000 .5000
Bulgaria 00000000
Romania 00000000
Russia 00000000
notes Abbreviations: dp – developmental performance, cc – civilisational compe-
tence,sc – social capital,cm – cognitive mobilisation,qg –qualityofgovernance,es –
entrepreneurialspirit,coh –social cohesion,op –openness.AdaptedfromAdametal.
2005 ,208 .
countrieswithlowerlevelsofcivilisationalcompetencethattookswayin
thepastfewdecades.InterestingexamplesareSpainandPortugal,which
have improved their quality of governance significantly since the 1970 s,
Volume 8 · Number 4 · Winter 2010

364 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
table 3 Relationshipbetweencivilisationalcompetenceandotherdevelopment
factors
Dependentfactor p-value
sc 0 .017 *
cm 0 .033 *
qg0 .358
es 0 .012 *
coh 0 .003 *
op 0 .025 *
notes *Denotessignificanceat10 percentlevel.
table 4 Relationshipbetweensocio-culturalfactorsanddevelopmentalperformance
Causevariable Observedoutcome** Binominalprop. p-value
cc 19 0 .90 0 .009 *
sc 17 0 .81 0 .092 *
cm 19 0 .90 0 .009 *
qg200 .95 0 .001 *
es 20 0 .95 0 .001 *
coh 12 0 .57 Notsignificant
op 19 0 .90 0 .009 *
notes *Denotessignificanceat10 percentlevel.**Thesizeofoursampleis27 coun-
tries,butonly21 wereincludedintheanalysis.Thisisduetothespecificsofthefuzzy-set
analysis of sufficient conditions. Namely, including cases where the outcome is0 would
positivelybiastheresultstowardsverificationoftheresearcher’shypothesis.Thosecases
where the cause (individual factors of development) has a higher or equal fuzzy-set
membership than the outcome (developmental performance) confirm that a specific
factor is a sufficient cause. Hence, the column ‘Observed outcome’ shows the number
ofcaseswherethisisthecase.Thelogicis:thehigherthe‘observedoutcome,’thehigher
the‘binominalproportion.’Thefinalrowshowsthecalculatedstatistical significance.
especially as a consequence of the accession to the eu . Special cases are
the post-socialist countries, where significant improvements also took
place as part of democratisation in the 1990 s, although of the quality of
governance isstillnotthehighestquality.
Thesecondistherelationshipbetweenthetwolevelsofsocio-cultural
factorsanddevelopmentalperformance.Themodelisconsideredasem-
pirically verified if the factors are statistically significant necessary con-
ditions fordevelopmental performance:
The results show that civilisational competence, social capital, cog-
ManagingGlobalTransitions

QuoVadis,Slovenia? 365
nitive mobilisation, quality of governance, entrepreneurial spirit and
opennessofsocietiesarenecessaryconditionsfordevelopmental perfor-
mance. The only factor that is not statistically significant is the level of
socialcohesion.However,wecannotethatnocountrywithhighlevelsof
developmental performance has a low level of social cohesion, and only
two countries with medium developmental performance (Hungary and
Estonia) have low levels of social cohesion. Moreover, all countries with
a low level of developmental performance have low social cohesion. We
have therefore conducted another analysis, where we tested a different
relation, namely, the relation between a poor level of social cohesion as
a necessary cause of poor developmental performance. In this case the
relationship was statistically significant: a low social cohesion is usually
a necessary cause for a low developmental performance. But it is not a
sufficient one, meaning that some other negative conditions have to be
fulfilledaswell.
The analysis also showed that a combination of all necessary factors
is a statistically significant sufficient condition of developmental perfor-
mance.Thisresulthasimportantimplications:acountrycanembarkon
apositivedevelopmentpathonlyifallfactorsarepresentsimultaneously.
Therehastobeacumulativeeffectandsynergyamongfactors.
frameworkconditionsforfuturedevelopment
Having demonstrated the importance of internal socio-cultural factors
of development, we now turn to considering framework conditions that
will constrain or enhance the opportunities for countries to realizetheir
develoment potential. The most important, but certainly not exclusive,
framework conditions are – in our view – economic structure of the
world,politicalstructureof theeu ,demographic trends and technolog-
ical developments. Wedo notseparetely consider factors suchas climate
change or availability of energy, as they will impact on each of the four
areasthatweaddress.
economicstructureoftheworld
Globalisation, of course, is the main feature of economic developments
in the 21 st Century. The important point here is that globalisation has
now enabled fast development not only of the traditional ‘tigers,’ which
were as a rule rather small countries, but also of some ‘giants,’ whose
economic size, by current rates of growth, may in a decade or so equal
theeconomicsizeoftheeu .
Volume 8 · Number 4 · Winter 2010

366 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
Such developments may create serious tensions on at least three ac-
counts:
 New global geography of economic activity, where new centres of eco-
nomic power, but also human, financial and information capital,
would reach critical mass so as to challenge the competitive capac-
ity of the ‘western’ world. This is an overly pessimistic perspective,
as growth of the emerging economies also promotes growth in the
now developed world. The latter, however, is increasingly forced
into structural reforms, which enable opportunities to dominate
over threats. If, however, modern western world economies would
be unwilling or unable to adapt its working and living practices
to the new global circumstances, then the new economies could
becomeaseriouschallengeforthepreservationofthepresentstan-
dardoflivinginthewesternworld.
 Unprecedented increase indemandforraw materials andenergy,and
the corresponding increase in pressures on the natural environment.
The new ‘giants’ (China, India) would, at the time when the size of
their gdp equals that of the eu , create equally strong demand on
theworldmarketsastheeu does.However, astheirgdp percapita
wouldstillbemuchlowerthanthatoftheeu ,thestructureoftheir
demand will be relatively more directed towards energy, raw mate-
rialsandindustrialinputs.Atthistime,thereisnoclearsolutionfor
theseproblems.Ifasolutionisnotfound,wemayincreasinglyface
rising raw-material prices, energy shortages, climate change effects
etc.
 Pressures for a different political division of the world. The new gi-
ants will demand an equal role in the processes and institutions
thatgovernglobaleconomicorder.Giventheirlessereconomicde-
velopment (in terms of gdp per capita), and consequently a more
energyandenvironment intensivepatternofgrowth,thischangein
balance may also imply a change in priorities on the international
agenda. The stronger the shortage of the raw-materials and energy
willbecome,themorelikelyitisthatthisprocessofpolitical‘rebal-
ancing’mayinvolve seriousconflicts,includingmilitaryones.
Thereare,inprinciple,threepossibleoutcomes(scenarios):
 Emergence of a new leading world power.Itmaybesaidthatinthe
past there was usually one super-power dominating the rest of the
worldinbotheconomicandpoliticalterms.Aftertheindustrialrev-
ManagingGlobalTransitions

QuoVadis,Slovenia? 367
olution, this had been theuk , and since the World Warii,itisthe
usa . One possible outcome of current tensions is that there will
emerge a new economic and political super-power. However, there
seemstobenoclearandeasilyacceptablecandidateforsuchalead-
ingrole.Moreover,iftheglobalpoliticalgamebecomesoneoffight-
ingforadominantposition,itisverylikelythatitsoutcomewillbe
determined onlythroughmilitaryconflictofaglobaldimension;
 Emergence ofamulti-polar world.Rather than one super-power be-
ing replaced by a new one, it is possible that a balance will emerge
between several economic and political blocks. One of them could
still be the usa (with nafta ?), another a much more federatively
organizedeu ,thethirdoneChina,thefourthoneEast-Asia(Japan
with the ‘old’ Asian tigers), etc. The global political game would
then be one of balancing or finding a stable equilibrium between
these different poles. Such a game is more likely to be solved in a
non-violent way;
 Emergence of a highly decentralized world, withmanycentresofde-
velopment, resembling a world of city-states and prosperous re-
gions. Especially if a stable equilibrium between a limited number
of ‘poles’ proves hard to establish, the process of global decentrali-
sationmaycontinue,leadingtomultiplesmallcentresofeconomic
development, with international political institutions and powers
becominglessimportant.
TheEuropeanCommissionseemstobelieveinthesecondofthethree
scenarios. In its communication to Heads of States and governments
(Commission of the European Communities 2007 ), it stresses the im-
portance of ‘Europe’ speaking with one voice in the world. This com-
munication, which is formally the Commission’s interim report on the
Lisbon Strategy for Growth and Jobs, is almost entirely devoted to the
challenges of globalisation and to the so-called ‘external dimension’ of
the strategy. It builds its argument on the notion of the European in-
terest, which has to be ‘specifically defined, strongly articulated, stoutly
defended, and vigorously promoted,’ and claims the eu to be ‘the best
tooltoenableEuropeanstoshapeglobalisation.’
In our view, the first of the three possible outcomes (a new super-
power) is the least likely, especially as development and technological
differences intheworldarediminishing.Inthemediumterm,therefore,
the scenario of a multi-polar world (with three or four poles) seems to
Volume 8 · Number 4 · Winter 2010

368 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
be the most natural outcome of current developments. However, it also
seems at least possible, if not probable, that in the long-run (some 50
years) the multi-polar world would decentralise further in direction of
thethirdscenario.
politicalstructureoftheeu
The big issue here is whether Europe will, in time, develop into a feder-
ation in the sense of a ‘United States of Europe,’ or will perhaps devolve
into a more decentralised organisation. One obvious line of argument
saysthatEuropemustbecomemorecapableofactingasoneentityinthe
world, and that to achieve this, it must also become capable of more ef-
ficientdecisionmakinginternally (ec2007 ).Onthepoliticallevel,there
seemstobealotofatleastdeclarative supportforamorefederative Eu-
rope.
This argument seems so obvious to many precisely because the cur-
rent decision-making procedures in the eu are complicated and often
even very simple decision (such as establishing an eu -wide patent of-
fice) take several years. There seem to be two reasons for this. One is
that, even in the areas where decisions are taken at the eu level, this
decision-making still often involves complicated negotiations between
representatives of government, plagued with perverse systematic incen-
tives and often dealing with details that would normally be left to the
executive discretion.Theotheristhat,alsointheareaswherethereisno
genuine eu sovereignty, complicated processes of the ‘open-method of
coordination’ have been introduced, de facto hampering the autonomy
ofmemberstates andincreasingthecostofdecision-making.
While it is clear that the decision-making efficiency has to be greatly
improved intheeu ,thereareatleasttwowaystodoso:
 The United States of Europe. Sovereignty over an increasing num-
ber of policy areas would be transferred to the eu level. Decision
making at theeu level would be simplified and would increasingly
resemble that of a common representative democracy. Legislative
decisions would be taken by the European parliament alone on a
simple majority vote, probably subject to a veto by a senate, repre-
senting nation states or regions.The Commissionwould besubsti-
tuted by an executive body with much broader competences. The
scope for intergovernmental negotiations would be reduced to the
most basic political decisions, perhaps only to agreeing on changes
intheEuropeanconstitution.
ManagingGlobalTransitions

QuoVadis,Slovenia? 369
 A decentralised federation. The decision procedures at the eu level
would be simplified similarly as in the previous scenario. However,
much fewer issues would be transferred into the sovereign respon-
sibility of the eu . On the other hand, for those issues over which
member states would retain sovereignty, the formal coordination
procedures wouldberadicallystreamlined, ifnotabandoned.
Itisimportanttounderstandthatthechoiceoftheeu politicalstruc-
ture is not entirely voluntary. We do not believe such a decision can be
takenintop-downmanner,implyingthatthepoliticiansshouldfirstde-
cide on the political structure of theeu , and then all other policies sce-
narios couldbe worked out accordingly. Webelieve that the decision on
thestructureoftheeu willdependonexternalfactors(theshapeofglob-
alisation, security and energy issues, strengths and policies of emerging
‘giants’ and the currently dominant us , etc.) and also on some internal
politicalfactors.
ThecurrentstateofaffairsinEuropedoesnotenableustoexpectany
significant political changes in the short run. The reformed eu treaty,
which was put in the place of the failed constitution, makes some steps
towardsthefederative direction,buttheyarerathermodestandactually
pre-empt a more thorough discussion. The eu budget is also set until
2013 , andfornowitseems ratherunlikely forthenextfinancial perspec-
tive (up to 2018 or 2020 ) that any significant structural changes could
emerge.Indeedsomeproposalsarebeingputforwardthatcouldnotice-
ably improve the present state of play, thus alsoimproving the decision-
making efficiency of theeu as a whole (see Wostner2007 ), nevertheless
moreprofound changescouldonlybeexpectedafter2020 .
Despite these obstacles, most current discussions point towards the
direction of the United States of Europe scenario. In our view, such a
scenario is only possible in the long run with increased mobility inside
the Union and with radically changed citizen’s perception of the Union
asonehomeentity.Withtime,alsothepressuresoftheglobaleconomic
competition and insecurity may become strong enough that the politi-
cal opposition to a federative Europe would lose ground. On the other
hand, it may also happen that in 2020 Europe would decide to move
towards the direction of a ‘the decentralised federation.’ It may prove a
goodworking compromise between demands fora moreeffective feder-
ation and the opposition to transferring more and more competencies
to the ‘federal level.’
Volume 8 · Number 4 · Winter 2010

370 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
demographictrends
The European demographic problem is well known. Demographic pro-
jectionsfortheeu memberstatesareprovidedbytheEurostateveryfew
years.Detailedprojectionsoftheimpactoftheageingpopulationsonthe
public budgets are available for all member states in regular reports (ec
2009 b). However, the possible social implications of ageing populations
arelessresearched.
It is important to understand that the projections were prepared not
with the intention of predicting the future as accurately as possible, but
with the aim of highlighting the dimension and structure of the ‘ageing
problem.’Accordingly,projectionsarepreparedontheassumptionofno
policy change and on current trends in employment and productivity.
No rapid change in technology is envisaged, as projections work on the
assumption of a decreasing contribution of total factor productivity to
growth.Suchanapproachisverylogicalintheframeworkofa‘warning
signal’ analysis, but in order to incorporate them into overall develop-
mentscenarios,someassumptionsonthelikelypolicychangeshouldbe
included.
technologicaldevelopment
From Malthus to the Club of Rome, economic science has predicted
many dismal scenarios, but none has yet materialised. The main rea-
son why the dismal predictions were avoided lies in the technological
progress, which always succeeded in creating new opportunities and so-
lutions at the right time to avoid a catastrophe. Indeed, in the long run,
technological progress seems to be the main determinant of our well-
being, both in the sense of what we can achieve and in the sense of how
productive weare.
Technological progress may determine the solutions we will be able
to adopt with respect to the previous issues. The increasing energy and
environmental scarcity can hardly be addressed without a serious tech-
nological breakthrough. The same goes for ageing – new technologies
may facilitate older people to at least partially remain in paid activ-
ity after reaching the pension age. Notwistanding some technological
foresight studies and studies on the likely social consequences of tech-
nological change, technological scenarios are inherently hard to build.
Technology is based on innovation, and innovation, if it is really an un-
precedented novelty, is by definition hard to predict or even to imagine
inadvance.
ManagingGlobalTransitions

QuoVadis,Slovenia? 371
bringingtheelementstogether
Whileitishardenoughtodevelopplausiblescenariosforindividual de-
velopment areas, the real challenge is to bring them together in a com-
pelling and comprehensive development vision. Here we present three
attempts thatweconsiderasimportantstepstowardsthisgoal.
In 1999 , the Forward Studies Unit of the European Commission out-
lined five possible scenarios for Europe in the year 2010 (Bertrand,
MichalskiandPench1999 ):
 Triumphant markets: increasing globalisation and prevalence of
the ‘American economic model’ (deregulation, lower taxes, en-
trepreneurship, downsizing of the public sector); weakening of
eu common policies, integration focused on the Single Market;
stronger roleofregions dueto amoredecentralized economy;
 The hundred flowers: increasing economic globalisation with seri-
ous risks for political stability, crime, environment; weakening of
eu commonpoliciesandwithdrawalofsomememberstates;devo-
lution of largeorganizations and nation states, development of city
states; public functions performed by local governments, associa-
tionsandprivate organisations;
 Shared responsibilities: increasing globalisation with greater inter-
national policy coordination, led by the eu ; increasing the role of
eu policycoordinationineducation,r &d ,securityandjustice,in-
creasing the budget; stakeholder model of enterprise and competi-
tivecorporatism;modernisationofthepublicsectorgovernance;
 Creative societies: slowdown in globalisation due to public discon-
tent; strong development of common eu policies in the areas of
socialprotection,environment,economicstabilisation;cooperative
enterprises, importanceofthenon-profit sector;
 Turbulentneighbourhoods:slowdowninglobalisation,developingof
closed regional blocks; security concern dominating eu common
policies and public opinion, rise of intolerance, increased role of
thestateandauthoritarianism.
Braunerhjelmetal.(2000 )developedthreescenarios,dealingwiththe
economicperspectiveofindividual regionswithintheeu :
 Scenario of a balanced distribution of economic activity, based on
substantially increased specialization of particular regions, with
eachoftheregionsfinding itsownmarketniche;
Volume 8 · Number 4 · Winter 2010

372 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
 A strong concentration of economic activity, enabled by increased
labourmobility,resultingin depopulation ofsomeareas,but with-
outstrongunemploymentproblems;
 A permanent polarization, dividing Europe into efficient, high in-
come,lowunemployment regions onone side,andlagging-behind
regions with low income and high unemployment on the other.
Thisscenarioislikelyiftheincreasedglobalcompetitionisnotmet
bystructuralreformsoftheeu economies.
The most extensive work in terms of future scenarios for Europe and
their regions was,toourknowledge, performed in theframeworkof the
espon network(www.espon.eu),wherenumbersofstudies,usuallywith
the perspective until the year 2030 , have been performed. They are fo-
cusedonparticularthemes(e.g.polycentricism,enlargement,transport,
information society, natural hazards) as well as on impacts of particu-
lar policies (e.g. transport, r &d ,cap , energy, cohesion policy). Partic-
ularly relevant isespon project 3.2. ‘Spatial Scenarios and Orientations
in relation to the esdp and Cohesion Policy’, which includes a quanti-
tive macroeconomic, sectoral, social and territorial model. Apart from
the baseline scenario, which takes account of what we called framework
conditions, they also develop a ‘cohesion-oriented prospective scenario’
anda‘competitiveness-orientedprospectivescenario.’Dependingonthe
policy choices by the eu and the Member States, they find significant
differences in terms of concentration of economic activity in the Euro-
peancore,majorcities,peripheralandruralareasandconsequentlytheir
welfare levels. On this basis they propose the ‘proactive scenario,’ which
aspires to put forward the right balance of policies based broadly on the
Scandinavian development model.
DiscussionandConclusion:SomeTentativeImplications
forSlovenia’sAlternativeScenarios
We began our paper by asserting that, in order to meaningfully dis-
cuss the possibilities of development catch-up, one must consider both
the external framework conditions and the internal development capa-
bilities. Success in dealing with the four big challenges stemming from
changes in global economic structure, European political structure, de-
mographic trends and technological development, is always a resultant
of external forces that shape the conditions and internal processes and
adaptations.
ManagingGlobalTransitions

QuoVadis,Slovenia? 373
One way to analyze the interplay between framework conditions and
internal capabilities istoaskwhetheragiven frameworkscenariowould
increase the autonomy of regions and individual countries, or diminish
it? In case of increased autonomy, we should focus on country-specific
developmentassets(strengthsandweaknesses).Incaseofdecreasingau-
tonomy,weshouldhoweverexpectthatindividualcountrieswillbroadly
share the fortunes of the eu as a whole, although they may have some
means to improve their relative position even in such a context. Among
the scenarios outlined in thethirdsection, wesee as ‘autonomy enhanc-
ing’ the economic scenario of a more decentralised world and the po-
litical scenario of a more decentralised European Union. Technological
progress facilitating transfer of information, decentralised organisation
and‘distancework,’wouldalsofacilitateautonomy.
WhenaskingaboutfuturetrendsofacountrylikeSlovenia,oneneeds
to consider whether it is realistic to expect that any of the post-socialist
countriescouldintheforeseeablefuturebeabletoachievedevelopmen-
talbreakthroughandsotojointheexclusivecluboftherichcountriesof
theEuropeancore?Thiswouldinfactbearemarkableachievement,hav-
ing in mind the historically poor economic development performance.
In contrast to approaches based on extrapolation of current trends, we
embarkedonsearchingfortheanswertothisquestionratherdifferently.
Wewereinterested toseewhetherthesestateshavedeveloped theneces-
saryconditions forfasterdevelopment.
Basedonouranalysis,weconludethatonlysomeofthesemi-periphe-
ralcountrieshavearealisticpossibilitytobecomemembersofthegroup
of most developed European societies. We limit our optimism to those
whichwereclassifiedascountrieswithamediumlevelofdevelopmental
performance(CzechRepublic,Slovenia,Estonia,HungaryandSlovakia).
That means that their economies are already at the investment-driven
stage of development and are capable of building capacities to improve
the imported and assimilated technology and production methods, and
tomanagethecomplextransitiontoinnovation-driven development.
The obvious question is: can what specific societies do to enhance
their developmental performance? Implications of our results for shap-
ing holistic strategies of sustainable economic development confirm
some previous findings (Messner1997 ; Mayntz1987 ), that developmen-
tal policy makers must consider a series of structural limitations arising
from their own environment. Therefore, it is not realistic to expect that
simpledirectinterventionslikeincreaseinfinancialinvestmentintospe-
Volume 8 · Number 4 · Winter 2010

374 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
cific resource or infrastructure will considerably affect developmental
performance. Hierarchic or ‘top-down’ approaches cannot give satisfac-
tory results. The post-socialist societies of Central and Eastern Europe
need to work their way towards establishing the right preconditions for
developmental performance. Successful strategies need to use sophisti-
catedmechanismsofcontextualinterventionstoestablishtheconditions
where different intangible factors of development develop simultane-
ously.
Obviously, no clear-cut prescriptions or recipes are possible, such as
thosepersistently advocated bynumerous international institutions and
scientists in the course of the past decade. If there is something that one
can learn from past examples of successful transitions from the semi-
peripherytothecore,itisthatnocountrydidsobyimitatingsome
othercountryorbyfollowingsuchprescriptions.Itneedstobeclearthat
social scientists are not able to generate solutions in the form of ‘pure’
prescriptions and ‘categorical imperatives’; they can at best produce hy-
pothetical solutions in the form of scenarios, multipleoptions and cost-
benefit or swot analyses. They can be very helpful by indicating and
evaluating the side effects and potential risks of certain decisions and
policies. And, perhaps most importantly, they can attempt to trace the
necessary conditions for favourable outcomes. In the paper, we tried to
establish these ‘intangibles’ by using a heuristic model of socio-cultural
factorsofdevelopmentalperformanceandwithapplicationof‘fuzzy-set’
analysis.
Focusing on Slovenia, it scored as middle ground in all dimensions
of our fuzzy-set analysis. The implication is that, in order to achieve the
developmentalbreakthrough,thecountrymustworksimultaneouslyon
improving all internal factors of development. For ‘active societies’ (Et-
zioni 1968 ) such insights can be a useful tool for self-reflection, learn-
ing and adaptation of developmental policies. But, as argued elsewhere
(Ronˇ cevi´ c 2008 ), Slovenia today cannot be considered as an ‘active so-
ciety.’ One can therefore question the current ability to learn from such
findings.
Hence, it would make sense to predict two broad and quite distinct
scenariosforthefuture.Themaindifferencebetweenthesetwoscenarios
should be the (in)ability to make a strategic shift in several very impor-
tant fields at the same time. The new development model should com-
bine positive characteristics of the more liberal economy with a Euro-
pean model of a partner-state, the latter nicely fitting Slovenia in terms
ManagingGlobalTransitions

QuoVadis,Slovenia? 375
of its development capabilities and values. On the other hand, inability
to break with the existing model would continue Slovenia’s path depen-
dency andsemi-peripheral position.
As a small country, Slovenia should be naturally inclined to oppose
tendencies of politicalcentralisation in theeu and of establishing a new
single globaleconomic super-power. The rationale for this is that Slove-
nia would have a comparatively small influence on centralised decision-
making in the eu and that it would be higly risky to depend on only
one major economic partner. We should therefore consider autonomy-
enhancing framework scenarios as more beneficial. However, there are
areaswhereworkingtogetherwith–orsimplyleaningon–theeu insti-
tutionsmayhelpthecountrytodevelopitsowninternalcapabilities.The
dimensions of governance and openness, but alsoof cognitive mobilisa-
tion and entreprenurial spirit, are those where adopting best practices
from other member states, or relying on common policies and the pres-
sures of the common market, may prove highly stimulative for internal
development processes.
Notes
1 A good example of a detailed analysis along such lines is the European
Commissionstudyon‘fiveyearsofenlargement’(ec2009 a).
2 ForathoroughreviewofSlovenia’s transition, seeMrak, Rojec andSilva-
Jauregui(2004 ).
3 SeeŠušteršiˇ c(2009 )foranoverviewoftheargumentsinvolved.
4 This strategic document sets out the vision and objectives of Slovenia’s
development until 2013 and includes five developmental priorities with
correspondingaction plans.InorderforSloveniato achieve thesegoalsit
needs to prepare and deliver sweeping structural reforms and change its
existingdevelopmentpattern.
5 It needs to be emphasised that our focus on ‘intangibles’ does not ren-
derunimportantmore‘tangible’factorslikemacroeconomicstability.But
wearguethatitisnotafactorwhichcouldexplainthedi fferences be-
tween highly developed and less developed countries. Stabilisation of the
macroeconomic framework is only a part of systemic competitiveness
genesis(Esseretal.1996 ).
6 In Berend’s opinion, the Mediterranean eu member states are a success
storywhencomparedtopost-socialistcountries.Byemployinglong-term
data on gdp , he describes a ‘dramatic departure from their previously
similar growth patterns’ (Berend 2001 , 258 ). But on the basis of data in-
dicating the position in the international division of labour andgdp ,we
Volume 8 · Number 4 · Winter 2010

376 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
would hesitate to talk about a success story. The substantial increase in
differencesbetween Mediterranean countries and post-socialist countries
was primarily caused by a rupture of growth rates of the latter and is not
evidenceofthedevelopmentalperformanceoftheformer.
7 Mostfdi camefromtheusa (O’Hearn1998 ).
8 ExpertsputforwarddifferentviewsonthecausesofIreland’ssuddeneco-
nomic growth. Some conclude that it was a consequence of a series of
reasons, being present far before anything happened (Walsh 1999 ;Battel
2003 ).Elsewhereathesiswasputforwardthatsystemicdiscourse,institu-
tionalised in a long-termsocial partnership with strong spill-over effects,
wasthecatalyserofexistingdevelopmentfactors(Ronˇ cevi´ c2008 ).
9 The case of Czechoslovakia is telling. Between the world wars, it was the
onlyindustrialised and developed Central European country. This was at
leastto someextenttheconsequenceofsuccessfulnational confrontation
with the German speaking population. ‘After the 1840 s, the Czech lands
were caught up in rivalry for economic dominance where on both sides
(GermanandCzech)thefrenzyforeducation,culture,journals,clubsand
entrepreneurship became paramount’ (Benaˇ cek 2001 , 137 ). The Czechs
were able to respond to the challenges of the industrial revolution. This
was not an enforced process; it was spontaneous and highly motivated.
Dataonthedensityofindustrialsitesshowthatthecountrywasthemost
industrialised part of the monarchy. In1914 ,Austriahad60 factories per
100 ,000 population. Czech lands had94 , while the central part of today’s
Sloveniahadonly29 (Hoˇ cevar1965 ,45 ).
10 In Schöpflin’s (2000 , 60 ) words: ‘In Central and South-Eastern Europe,
domesticmodelsofmodernity[...]wereweakandnotbasedverydirectly
on local socio-economicpatterns, butwereimported from outside, often
as a response to the intrusion of a power that was perceived as alien, and
asadefenceagainstthatintrusion.Thisprocessofimportationinevitably
distorted the nature of modernity as it had evolved in the West, because
thedomesticcontextwasdifferentandtheaspectsofmodernitythatwere
taken over wereinevitably partial. Technology has a cultural context, and
thereceptionoftechnologywithoutitsenvelopingculturechangesitsim-
pact. Hence the repeated attempts to make ‘a forced march through his-
tory’andtocatchupwithEuropeneverachievedtheirobjective.
11 In the1940 sand1950 s, there had been much interest in studying the role
ofcultureasakeyelementforunderstandingsocietiesandanalysingtheir
economic and political development (e.g. by Margaret Mead, Ruth Ben-
dict,DavisMcClelland,EdwardBanfield,AlexInkeles,LucienPye).Inthe
60 s,theinterestdroppedrapidly.
12 AgoodexampleistheyearbookCultureMatters,wherethesefactorswere
ManagingGlobalTransitions

QuoVadis,Slovenia? 377
discussedbyauthorsfromfieldsofsociology,politicalscience,anthropol-
ogyandeconomics(HarrisonandHuntington2000 ).
13 This concept was developed by Sztompka to explain differences between
developed West European and underdeveloped East European societies.
We significantly changed his formulation in an attempt to improve it to
observethedifferencesbetweenEastEuropeansocieties.
14 Toillustrate,letustaketheexampleofthefuzzy–set‘developmentalper-
formance.’ On the basis of Porter’s definition of successful economic de-
velopmentas‘aprocessofsuccessfulupgrading,inwhichthebusinessen-
vironment in a nation evolves to support and encourage increasingly so-
phisticated ways of competing’ (Porter, in World Economic Forum2002 ,
57 ),wedefinedtheconcept,threeanchors,andtheirverballabels.Wethen
used various statistical data on patents (innovativeness and new knowl-
edge),gdp (ppp ),overallproductivityandtotalhourlycompensationfor
manufacturing workers, to classify the countries into three groups, and
thenassignedmembershipscoresforeachcountry(1=highdevelopmen-
tal performance,0 .5 = medium developmental performance,0 =lowde-
velopmentalperformance).
15 Weanalysedthedatawithcomputerprogrammefs /qca ,version0 .963 .
References
Adam, F. 1989 . Deformirana modernizacija – (realni) socializem med
tradicijoinmodernostjo.Družboslovne razprave6 (7):19 –30 .
Adam, F., M. Makaroviˇ c, B. Ronˇ cevi´ c, and M. Tomšiˇ c. 2005 . The chal-
lengesofsustaineddevelopment:Theroleofsocio-culturalfactorsinEast-
Central Europe.BudapestandNewYork:ceu Press.
Adam, F., and B. Ronˇ cevi´ c. 2003 . Social capital: Recent debates and re-
searchtrends.SocialScienceInformation42 (2):155 –83 .
Adam, F., and B. Ronˇ cevi´ c. 2004 . Razvojni potencial socialnega kapitala.
Družboslovne razprave20 (46 –7):219 –37 .
Battel, R. N. M. 2003 . Ireland’s ‘celtic tiger’ economy. Science, Technology
andHumanValues28 (1):93 –111 .
Barro, R. J.1991 . Economic growth in a cross-section of countries. Quar-
terlyJournalofEconomics106 (2):407 –43 .
Benaˇ cek, V. 2001 . History of Czech economic and political alignments
viewed as a transition. InSmallcountriesinaglobaleconomy,ed. D.
Salvatore,M.Svetliˇ ciˇ c,andJ.P.Damijan,133 –54 .NewYork:Palgrave.
Berend,I.T.2001 .Thecrisiszonerevisited:CentralandEasternEuropein
the1990 s.EastEuropeanPoliticsandSocieties15 (2):250 –68 .
Berend, I. T. and G. Ránki. 1982 . The European periphery and industrial-
ization.Cambridge:CambridgeUniversity Press.
Volume 8 · Number 4 · Winter 2010

378 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
Bernik,I.1989 .Socialistiˇ cna družbakot‘obmoderna’družba.Družboslov-
ne razprave6 (7):31 –40 .
Betrand,G.,A.MichalskiandL.R.Pench.1999 .ScenariosEurope2010 :
Five possible futures for Europe. Working Paper, European Commis-
sionForwardStudiesUnit.
Braunerhjelm P., R. Faini, V. Norman, F. Ruane and P. Seabright. 2000 .
IntegrationandtheregionsofEurope:Howtherightpoliciescanprevent
polarization.London:CentreforEconomicPolicyResearch.
Castells,M.,andP.Himanen.2002 .Theinformationsocietyandthewelfare
state:TheFinnishmodel.Oxford:Oxford University Press.
Cheshire, P., and S. Magrini. 2000 . Endogenous processes in European
regional growth: Convergence and policy. Growth and Change 31 (4 ):
455 –79 .
CommissionoftheEuropeanCommunities.2007 .The Europeaninterest:
Succeeding in the age of globalisation; Contribution to the October
meeting of heads of state and government Communication from the
Commission to the European Parliament, the Council, the European
Economic and Social Committee and the Committee of the Regions.
com (2007 )581 .
Ellias,N.1994 .Thecivilizingprocess.Oxford:Blackwell.
Esser, K., W. Hillebrand, D. Messner and J, Meyer Stammer. 1996 . Sys-
temic competitiveness: New governance patterns for industrial develop-
ment.London:Cass.
Etzioni,A.1968 .Theactivesociety:Atheoryofsocietalandpoliticalprocess.
NewYork:FreePress.
European Commission. 2009 a. Five years of an enlarged eu :economic
achievementsandchallenges.EuropeanEconomy14 (1):228 .
European Commission. 2009 b. Ageing report: Economic and budgetary
projectionsfortheeu -27 memberstates(2008 –2060 ).EuropeanEcon-
omy14 (2):456 .
Granato,J.,R.InglehartandD.Leblang.1996 .Theeffectofculturalvalues
on economic development: Theory, hypotheses, and some empirical
tests.AmericanJournalofPoliticalScience40 (3):607 –31 .
Harrison, L. E., and S. P. Huntington, eds. 2000 . Culture matters: How
valuesshapehumanprogress.NewYork:Basic Books.
Heylighen,F.1992 .Principlesofsystemsandcybernetics:Anevolutionary
perspective.InCyberneticsandSystems ’92 , ed.R.Trappl,3–10 .Singa-
pore:WorldScience.
Hoˇ cevar,T.1965 .ThestructureofSlovenianeconomy 1848 –1963 . New York:
StudiaSlovenica.
imad .2005 .Slovenia’sdevelopmentstrategy.Ljubljana:imad .
Kim,L.,andR.R.Nelson,eds.2000 .Technology,learning,andinnovation:
ManagingGlobalTransitions

QuoVadis,Slovenia? 379
Experiencesofnewlyindustrializingeconomies.Cambridge:Cambridge
UniversityPress.
Mayntz, R.1987 .PolitischeSteurungundgesellschaftlicheSteurungsprob-
leme: Anmerkungne zu einem theoretischen Paradigma. In Jahrbuch
zur Staats- und Verwaltungswissenschaft,ed.T.EllweinandJ.J.Hesse,
89 –110 .Baden-Baden:NomosVerlagsgesellschaft.
Messner,D.1997 . The network society: Economicdevelopmentandinterna-
tionalcompetitivenessasproblemsofsocialgovernance.London:Cass.
Mrak, M., M. Rojec and C. Silva-Jáuregui, eds. 2004 . Slovenia: from Yu-
goslaviatotheEuropeanUnion. Washington, dc :TheWorldBank.
O’Hearn, D. 1998 . Inside the Celtic tiger: The Irish economy and the Asian
model.Dublin:Pluto.
Ó Riain, S. 2000 . The flexible developmental state: Globalization, infor-
mation technology, and the ‘Celtic tiger.’ Politics and Society 28 (2):
157 –93 .
Ragin, C. C.2000 . Fuzzy-set social science.Chicago,il:UniversityofChi-
cagoPress.
Ritzen,J.,andM.Woolcock.2000 .Socialcohesion,publicpolicy,andeco-
nomic growth. Paper presented at the Annual Bank Conference on
DevelopmentEconomicsinParis.
Ronˇ cevi´ c, B. 2007 . Strategic discourse: A path-creation tool for develop-
mental latecomers. In The future of European regions,ed.P .Jakubow-
ska, A. Kuklinski and P.
˙
Zuber, 181 –93 . Warsaw: Ministry of Regional
Development.
Ronˇ cevi´ c, B. 2008 . Strateško usmerjanje v razvojni družbi. Nova Gorica:
Fakultetazauporabnedružbeneštudije.
Rossem,vanR.1996 .Theworldsystemparadigmasgeneraltheoryofde-
velopment: A cross-national test. American Sociological Review61 (3):
508 –27 .
Schöpflin, G. 2000 . Discontinuity in Central and South-Eastern Europe.
In Central Europe: Core or periphery, ed.C. Lord,57 –66 .Copenhagen:
CopenhagenBusinessSchoolPress.
Soto, de H. 2000 . The mystery of capital: Why capitalism triumphs in the
westandfailseverywhereelse.London:Bantam.
Swank, D. 1996 . Culture, institutions, and economic growth: Theory, re-
centevidence,andtheroleofcommunitarianpolities. American Jour-
nalofPoliticalSciences40 (3):660 –79 .
Swidler, A. 1986 . Culture in action: Symbols and strategies. American So-
ciologicalReview51 (2):273 –86 .
Šušteršiˇ c, J. 2009 . Endogenous gradualism and the Slovenian puzzle.
ChinaEconomicReview20 (2):265 –74 .
Volume 8 · Number 4 · Winter 2010

380 Ronˇ cevi´ c,Šušteršiˇ c,Wostner,andBesednjakValiˇ c
Walsh, B. 1999 .TheIrisheconomic‘miracle’:Howdoweexplainthetim-
ingoftheboom.New Economy6 (4 ):223 –28 .
Weber, M. 2001 . The protestant ethics and the spirit of capitalism. 2nd ed.
London:Routledge.
World Economic Forum. 2002 . The global competitiveness report 2001 –
2002 .Oxford:OxfordUniversity Press.
Wostner, P. 2007 .Onthecharacteroftheeu anditsbudget:Lookintothe
future. Http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=
874610 .
ManagingGlobalTransitions