Diversity of Capitalism : Evidence for Macedonia vis-a-vis Europe

Political economy has been interested in conceptual frameworks employed to understand variation across national economic and political institutions. In this paper, we analyze the extent to which emerging capitalist societies, particularly the Republic of Macedonia, as a representative of the non-EU post-communist Balkan state, fit into already existing taxonomies designed around developed capitalist economies. In particular, an unsupervised machine learning technique, the so-called self-organizing map, is used to capture the complex interactions (and complementarities) of institutions within the Macedonian economy and their spatial distance to other theoretically established models of European capitalism. Moreover, by linking economic complexity, productive structures and institutions, we explore how the presence of certain products in the country’s export basket relates to the particular form taken by its institutions and how the mutual interaction between the productive and institutional structure limits the potential, direction and straight of structural change and institutional transformation