The design of infrastructure policies is a controversial issue in the transition economies of Eastern Europe, where the dismal state of infrastructure was widely regarded to be one of the major obstacles to economic recovery and sustained growth. With the imminent enlargement of the EU, Christian von Hirschhausen provides a detailed, reflective analysis of the state of infrastructure development in Eastern Europe. The author illustrates the different approaches to modernizing infrastructure and the successes that have been achieved in terms of fiscal relief, private investment and increased efficiency. Based upon a comparative institutional analysis and extensive field research and case studies, he provides empirical evidence from different sectors (power, gas, railways, roads, R&D), with particular emphasis on countries such as Poland, Hungary, the Czech Republic, the Baltics and Russia. Given the substantial institutional instability of the early years of transition, the author promotes a gradual but time-consistent approach to liberalization as a more promising path towards a market economy and increased efficiency.
The author offers sound policy recommendations on how best to achieve the successful modernization of East European infrastructure in the course of EU-enlargement.