The Balkans in Europe Policy Advisory Group
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How to “regulate” politics in Bosnia?


One of the recommendations on a large list of possible actions to re-energize the EU integration process in the Western Balkans, which was presented in a policy paper recently published by the BiEPAG group, is more active engagement on the EU in resolving remaining bilateral disputes in the Western Balkans. In the case of Bosnia, this recommendation could be extended to the internal disputes in the country. Some of the reasons are explained below.

As Florian Bieber correctly pointed out in one of his recent blog posts, “The key question remains on how to change the incentive structure for Bosnian political elites.” He mentioned in the same text that the change occurred in some other cases (e.g. Sanader in Croatia, or Vucic in Serbia). If it worked in other countries of the region, why should it not work in Bosnia as well? In answering this question, it is important to understand the factors that have created current incentives among political structures in Bosnia. Tackling such factors could be a possible solution for shifting the incentive structure towards more cooperative (inter-ethnic in particular), more democratic, more accountable, and more integrative processes. Support from the EU, in supporting such reforms, could be the crucial one.

Currently, we can observe that there are forces in place that reinforce the “politicization of ethnicity,” and generate incentives for a shift of political parties’ programs towards more ethno-nationalist ones, particularly once they enter the government. For example, one of the main contributors to recent regression of democracy in Bosnia, Milorad Dodik, was perceived as a very desirable democratic alternative to the Serb’s Democratic Party (SDS) by the international community and the people in Bosnia in the late 1990s, Only a few years later, he and his party moved to the far right of the political spectrum. We observed similar changes of the position in the political spectrum for a number of other parties in Bosnia during the post-war period, including the already mentioned SDS. What might contribute to such movements? I am not a political scientist, and in an attempt to provide a contribution to such an answer, I will need to use economic theory, assuming it can present the argument in a sufficiently clear manner, and it should be appropriate in explaining the phenomenon (at the end, political parties “sell” their political programs and compete for voters). The main premise of the economic theory is that  competition better for society and should be promoted. This applies, particularly, to consumers who receive products at lower prices and better quality. What about politics? What about electoral system in Bosnia then?

There is nothing wrong with the general characteristics of the electoral system in Bosnia, being proportional; it, actually, helps secure adequate representation of different ethnic groups in the government. However, the complicated mix of ethnic and entity representation makes the access of any non-nationalist party to the government very difficult. According to the Bosnian Electoral Law, 2/3 of the members of the House of Repre­sentatives of the Bosnian Parliamentary Assem­bly and the members of the Presidency of Bosnia and Herzegovina are de-facto elected by Bosniaks and Croats living in the FBiH, while 1/3 by Serbs living on territory of RS entity (other ethnicities also have an active voting right, but the concentration of ethnicities as a consequence of the large displacement during the war does not give a minority ethnic group any significant political power). Division in the FBiH entity is further deepened by the representation of cantons at the entity level government, and the state level, through the electoral system where each individual votes for political representatives from its ethnicity. These “rules of the game” cannot produce different outcomes from the ones for the last 18 years, creating a large proportion of Bosnian populace who cannot express their desired political will and are, therefore, discouraged from participating in the elections. It suggests that the formal exclusion of Jews or Roma (the famous Sejdic&Finci case) from the political life in Bosnia is only the top of the iceberg; we can also observe de-facto exclusion of “constituent minorities” (Serbs in FBiH, and Bosniaks and Croats in RS), as well as a large “minority” of Bosnians (the ones who reject any ethnic belonging, but would like to be considered as ordinary citizens of Bosnia). An economist can recognize the problem of collusive practice by establishing exclusive territories here. In the goods market, such a collusive practice is generally forbidden, because it reduces competition and, consequently, reduces quality of products, increasing its price at the same time. Moreover, monopolists are generally less accountable, since their position at the market is secure. What about the electoral system in Bosnia then?

If such an electoral system creates exclusive territories, this means that political parties (sellers) have incentive to adjust the characteristics of its political program (product) to the specific ethnic group and territory (market). This is exactly what we can observe in the developments of the political program orientation of the parties in Bosnia. It is adjusted to the needs of the median voter of a specific ethnic group living on a specific territory. Political interests of the others mentioned above (“constituent minorities” and Bosnians) are completely ignored.

Referring further to the economic theory, it is important to note that the competition is enforced through regulation. A government does not expect companies engaged in collusive practices to regulate themselves, since it is against their main motive of profit maximization, but engages directly and enforces laws to be obeyed by companies. Why, then, does the EU continue repeating the phrase that “the solutions should be found internally, by political parties in Bosnia?” It is impossible, since it is completely against their interest. So, without an external influence and support to reforms, including reform of the electoral system, any democratic progress and improved functioning of the Bosnian state is highly unlikely.

Florian Bieber in the above cited blog post also mentioned that the EU (plus civil society) has the ability to induce such a change. If the international community imposed the electoral system in Bosnia, its reform could be also imposed, consequently offering an equal chance for other parties and political programs to compete in the elections. Again, agreeing with Florian Bieber, I would also argue that new parties are not necessary preconditions for the change in Bosnia, but changes to the rules of the game, which would provide incentives to political parties to make their programs more acceptable to all citizens of Bosnia, could be sufficient. There is a range of possible solution for redesigning the electoral system in Bosnia to be more favourable for pan-ethnic parties; some of them to be considered are offered by Chapman and Reilly. An engagement of the EU in this area seems to be a necessary step toward helping the country achieve sufficient degree of functionality and foster its transformations and fulfillment of the EU accession criteria.

Nermin Oruč

Nermin Oruč holds PhD degree in Economics from Staffordshire University, UK. He has more than six years of experience in teaching subjects such as Econometrics, Statistics, Research Methods, Economic Development and Industrial Organization, as well as more than 7 years of experience in leading and conducting research projects. His research interests include migration, remittances, poverty and inequality, labour market analysis, rural development and trade. He is president at the Centre for Economic Development and Research, Sarajevo and research fellow at SEEDS, Quebec.
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