The Significance of Borders in the East European Transition


The growth of small‐scale trading in Central Europe is fostered by the uneven development among post‐communist countries. This has encouraged small‐scale informal traders to cross the borders between these countries in order to buy and sell goods to supplement their incomes. This paper is based upon a study of these traders, involving qualitative interviews with 129 traders and observation of markets in Poland, Hungary, the Czech Republic and Slovakia. The paper argues that in a risky environment, where trading is either illegal or only semi legal, small‐scale traders try to minimize risk by building up different kinds of relationships with customers, representatives of the law and partners in trade. In the absence or inadequacy of formal institutional regulation, informal regulation through social capital becomes important. The paper considers the way in which social capital is created and cemented in these conditions through family, ethnic and social ties which can be ‘strong’ or ‘weak’ in character.