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Post-Socialist Countries 25 Years After: The Development Path of the East of Europe

Speaker: Prof. Ivn Tosics, Metropolitan Research Institute, Budapest, Hungary

The lecture aims to give a detailed overview about the transition from socialism into different types of
capitalist market system, both regarding housing and urban development. The overview will cover all the
European countries which once belonged to the socialist bloc (concentrating on those countries which joined
the European Union in the course of the 2000s). Topics of the lecture will cover the following.

The socialist model of urban development and housing policy in central and eastern European countries

The transition from socialism to capitalism, models and processes:

Political and economic changes,
Democratization and decentralization of public administration and planning,
Market-oriented restructuring of the housing sector (privatization, restitution)

Dilemmas and innovations in the emerging market system

The challenge of public regulations over private investment led territorial development, the examples of
growth poles and micro-regional cooperation
Problems of urban development and innovative concepts for sustainability: metropolitan area cooperation,
integrated urban planning and socially sensitive area-based regeneration
Disadvantages of over-privatization of the housing sector and alternative solutions for restructuring: the
problems of the social rental sector, changing social welfare regimes

The governance of planning and development: decision-making and participation, social justice and the role
of the planners

The effect of the financial crisis, reactions in post-socialist countries and cities in pan-European comparison

Post-socialist countries and cities 25 years after: the performance of the market model in urban development
and housing from economic efficiency, environmental sustainability and social equality perspectives

The story of the transition and the contradictory development of the emerging market systems will be
illustrated with figures and photos from different post socialist countries and cities


Statue that went from Marx to Reagan

High expectations for democracy and quick economic development when east-central European
countries become free 25 years ago

Brief History of CEE

Border changed many times in the last 100 years; many new countries established in the past 50

Capital cities: only 5 before 1914; now more than 20 after 1992; very interesting because it takes a
lot of time to build a capital city; says a lot about urban development in CEE

In the ideology of socialism, infrastructure (ex. motorways) is second to industry (productive

capacity); not only this, infrastructure like telephone lines was very primitive; we can see this in the
map of motorways in 1936 vs. 1996 (everything planned in Western Europe was built while there
was almost no motorways in Eastern Europe)

Basic Principles of Socialist Development

Infrastructure not over productive capacity

o You cannot own two flats because if you rent it out, it is considered income without

Residential incomes under (at the beginning total) state control

Strong and direct control over land use

Administrative limitation of housing consumption (one unit per family)

State control over all housing policy factors (state financed housing constructions, social housing
policy, construction industry and materials)

Everything is free except for housing; even if you were broke, you could go to university as long as
you were good enough

Basic Principles of Socialist Urban Development

Significant state ownership of the land and the housing stock in cities (as a consequence of

Functional zoning of land use patterns (separation of residential and industrial zones)

Administrative limitation of development of cities (ex. Moscow; China is similar with the control of
people coming in from rural areas to urban areas)

Mobility based on public transport (with the aim to reach 90% share)


Panel building for houses (able to build in many places in Hungary)

Calculated that for an elevator (best to build up to 10 floors high); 4 floors high for no elevators

Worker hostel was very nice for their times; workers from villages took the Monday train in and left
for their village on Friday afternoon

Inequalities in the Socialist Cities

Research of Ivan Szelenyi in the 1960s

o Defining the different housing classes
o Exploring the dissemination of social groups between the housing classes (inequalities of the
housing system)
o Analyzing the spatial differentiation and segregation of social strata

Key 1: allocation of housing according to merits gained within the socialist system. Proving that
people closer to the socialist elite get systematic advantages. The market played relative equalizing
role at that time. Basically the workers to do not benefit, but the intellectuals do! This was very
dangerous and he was expelled for this research.

Key 2: inequalities not just in the housing system, but everything!

The Transition From Socialism

Socialism: unique political and economic system, making the countries similar (convergence)

Ivan Szelenyi: after the fall of socialism divergence started with three different pathways out from
o East-central Europe: towards liberal capitalism, according to the Chicago school cookbook,
neoliberal economics. Enclosure of commons was done in 5010 years (England: it took 300
o Russia and Ex-Soviet States: towards patrimonial capitalism.
o China: towards capitalism from below. 1978-1985: inequalities were declining, small
businesses in the country side

Privatizing the Housing Stock

Meeting in the early 1990s between UK housing researchers (Chris Hamnett, Alan Murie and others)
with the mayor and head of housing of Budapest. The topic: housing privatization in Britain.

Hamnetts remembered this as fascinating example of how people with different agendas speak past
one another:

The UK researchers outlined their critique of the operation and the consequences of
Thatcherite ritght to buy