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In this article, we examine the evolution of minimum income programmes in the Western Balkans (comprising Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia). During socialism, Yugoslavia developed a rudimentary minimum income protection programme, while Albania did not have one. As countries moved towards a market economy, socialism's legacy remained relevant, but especially since 2000, governments have taken more direct responsibility for the minimum income schemes—typically under the influence of the World Bank. The attention was paid to strict targeting accuracy rather than to adequacy or sufficient coverage of the lowest deciles. In essence, neither socialist nor neoliberal policymakers ever recognised anything but the poverty relief function of the minimum income. Both ideologies were hostile, or at best indifferent, to increasing the adequacy and generosity of minimum income programmes, perceiving them as impediments and distractions that slowed socialist and neoliberal transformations. Despite some reform initiatives supported by the World Bank and, more recently, the European Union, the generosity and adequacy of minimum income programmes remain low, and coverage keeps declining. There have been very few efforts to develop inclusion function of the minimum income, while the activation aspect has achieved very little, sometimes degrading into punitive programmes of unpaid community work. In this dismal picture, the European Pillar of Social Rights action framework could serve as a guide for a long overdue third phase in the Western Balkans' minimum income policy evolution. [ABSTRACT FROM AUTHOR]

International aid and assistance to the Western Balkans, which began more than two decades ago after the disintegration of SFR Yugoslavia, has been severely criticised on various grounds by academics, politicians, and domestic elites. One of the main points of criticism has been heavy foreign interference into domestic affairs, which deprives local policy-makers of 'policy ownership.' This paper uses four paradigmatic examples of reform in Serbia - in the areas of labor market, income taxation, pensions system, and privatization - to show that, despite the widely accepted view of the dominant role of international actors in the creation of the reform agenda, there was significant room for local policy-makers in Serbia to exercise full ownership over the ongoing reforms. What policy-makers really needed was expertise, a clear vision of the desired reforms, the determination to defend their agenda, and technical skills to implement it. The significantly different outcomes of the four areas of reform analyzed in this paper, despite involving virtually the same actors of international intervention, seem to illustrate well our hypothesis that the failure of some important sectoral reforms in Serbia during the post-2000 period was the result of the policy-makers' own weaknesses, rather than the result of external conditionality. [ABSTRACT FROM AUTHOR]

The impact of the economic crisis in Serbia has been rather mild in terms of impact on the contraction of output, but it has been very severe in terms of job losses, which have seen an already difficult labour market situation deteriorate significantly. Under such circumstances, employment growth, alongside a reduction in absolute and relative poverly, needs to be defined as an explicit final objective of any development strategy for the next decade. Macroeconomic and sectoral policies and institutional reforms need to create an environment which is conducive to job growth. Labour taxes for low wage labour need to be substantially reduced, while making work pay policies need to be introduced. Education policy should improve the quality and efficiency of education and tackle the growing skills gap, while more funds are required for active labour market programmes. Social dialogue should be given more prominence, while collective bargaining in the private sector should additionally be encouraged. [ABSTRACT FROM AUTHOR]

This article is not an attempt to provide a comprehensive analysis of all the major aspects of the efficiency-equity nexus in Serbia in economic and social policy. Rather, it presents our main thesis that, at least in the present Serbian context, the equity-efficiency trade-off is not really relevant. We argue that, explicitly or implicitly, applying policies tailored in favour of the worse-off in labour, welfare and education would simultaneously improve both the efficiency and the equity of the Serbian economy. Our main contribution is progressive income taxation, which favours not only the equity factor but also the competitiveness of the economy. In addition, we argue that spending more on social assistance and less on public sector salaries would reduce poverty but also reduce the queues of members of the labour force attracted by the winner-takes-all allure. Restructuring spending on education so that teachers get relatively less and students relatively more would, again, be a socially-desirable outcome, simultaneously enhancing the efficiency of the education system. [ABSTRACT FROM AUTHOR]