The transition process of the formerly socialist economies of Eastern Europe dates back more than a decade. Whereas a few countries now entering the European Union experience significant progress some others, most notably the former CIS-countries including Russia, lag behind. Despite the central...

Through the use of a simple behavioural political economy model, we cast doubt on the assumption that voters behave in predictable ways dependent on their expected support for government policies. We show that under certain conditions an unfavourable (i.e. welfare reducing) policy may result,...