[PEN-L:1851] Yugoslav inequality

[Rosser Jr, John Barkley]

     I feel a need to express some further observations on 
this topic that came up in conjunction with the social 
democracy thread.  Why did regional inequalities get so bad 
in Yugoslavia?
     One aspect of this that is especially puzzling is that 
there was quite a bit of regional redistribution under the 
old regime.  Indeed this was one of the grievances of the 
secessionists in both Slovenia and Croatia, the desire to 
stop sending funds to the poorer southern republics and 
autonomous republics.
     Which raises the question as to why did the sent funds 
fail to help?  Conservatives might argue that this is what 
one should expect, that people do not do well who are being 
given handouts.  Another argument has to do with corruption 
and mafias.  After all, nearby Italy has also had a major 
divergence between north and south in per capita income 
since WW II with many blaming the mafia for the Mezzogiorno 
problem.
     It is curious that more market capitalist economies 
have had more regional convergence, e.g. the catching up by 
the South in the US, as have the more command socialist 
type economies such as the USSR or China under Mao.  Of 
course in China under Mao the development of the interior 
was partly driven by defense motives.  The local 
self-sufficiency laid the foundation for growth later with 
the TVEs.
     In the old USSR there was a successful effort to 
develop hinterlands, including the far north, the far east, 
and Central Asia.  The "conservatism" of the Central Asian 
nations, maintaining much of the previous system and 
resisting Islamic fundamentalism must be at least partly 
attributed to this successful development, although some of 
it was ecologically disastrous as in the Aral Sea region, 
and there is much local despotism by leaders, many simply 
left over from the ancien regime.  But in Russia the 
hinterland is now suffering and badly.
     Anyway, I don't have any answers as to why the 
regional inequality problem was so bad in Yugoslavia, but I 
am skeptical that one can attribute Slovenia's success to 
an alleged exploitation of the poorer regions of the former 
nation state.
Barkley Rosser

-- 
Rosser Jr, John Barkley
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