This book seeks to shed further light on the type of capitalism that has emerged in Central Asia, the Caucasus and other peripheral areas of the post-state socialist world, drawing out the implications for both domestic and overseas firms from a broad perspective that is founded in the literature on comparative institutional analysis. We call this cluster of countries the ‘transitional periphery economies’, to set them apart from other emerging and more mature types of capitalism; this reflects the more complex mix of political and market mediation, and informal personal ties, than is encountered in the more developed states of the post-state socialist world. This collection is a wide-ranging one, and incorporates both detailed country studies and chapters dealing with broad thematic issues. What these accounts have in common is that liberalization is not a one-way street, and that there is little connection between liberalization and growth. At the same time, international firms are pragmatic and creative in finding ways of coping with quite different yet durable forms of institutional mediation and coverage. COMPARATIVE CAPITALISM AND THE TRANSITIONAL PERIPHERY Although the early literature on comparative capitalism focused on the case of the developed world, there has been a growing interest in the types of institutional arrangements prevalent in key emerging markets (Lane and Wood, 2012; Wood and Demirbag, 2012; Demirbag and Yaprak, 2015). The early literature on comparative capitalism held that only in the developed world were there the institutional foundations for stable and sustained growth and high levels of overall prosperity, and in other economies there would be strong pressures to converge with either the liberal or coordinated market ideal (Hall and Soskice, 2003). However, since the early 2000s, it has become clear that many emerging markets have proved capable of generating significant growth despite a failure to evolve towards one or other of the mature institutional archetypes, and others have become locked on suboptimal trajectories, with little prospect of meaningful institutional redesign (Lane and Wood, 2012). This has led to efforts to identify new capitalist archetypes that might best describe such persistently different economies. Again, much of the early comparative literature on institutions has tended to focus on the firm as a transmission belt, whereby specific sets of institutional pressures resulted in some outcome or other; what went on inside the firm was, at best, described in terms of stylistic ideal-types (Wood et al., 2014). This, in turn, has led to a subsequent interest in exploring variations in intra-organizational practice, and the effects of the entrants of new players from abroad.
Geoffrey Wood and Mehmet Demirbag
This chapter seeks to develop understanding of both transitional peripheral economies and the consequences of clan-based authoritarianism, through looking more closely at the type of capitalism that has emerged in Central Asia, the dominant growth regime and the type of firm-level practices associated with this, focusing in particular on the case of Uzbekistan. The chapter examines why the Uzbek government promoted a narrative of antiquarianism, which may be defined as the promotion of a particular period of past glory, both as a core feature of national identity and as the basis for present and future life. The chapter also highlights the pattern of foreign direct investment in Uzbekistan and draws out the implications for foreign investors in the country.