International Inequality and Integration: Explaining European Union Expansion and Regime Type Variation in Eastern and Central Europe.

In this paper, I argue that two important causes of international integration are given insufficient weight in the integration literature. First, poor countries seek to integrate with rich countries in order to secure budgetary transfers, import improved political institutions and increase political stability, increase the inflow of foreign capital, and secure large gains in market access for their firms. Second, rich countries integrate with poor countries when political instability in the poor country generates significant negative externalities for the rich country. An important determinant of whether those negative externalities will accrue is the relative geographic proximity of the countries. Because the benefits of integration with rich countries tend to be large for poor countries, and because democracy tends to be a prerequisite of integration with rich countries, credible prospects for integration increase the likelihood of democratization. For those countries for which dictatorship prevents beneficial integration, the opportunity cost of dictatorship is relatively high. Hence, their pro-democracy forces are more likely to successfully organize, attract political support, and establish democracy. I apply the argument to the case of EU expansion and regime type variation in post-communist Central and Eastern Europe (CEE). I argue that a country?s geographic proximity to the EU core determines the credibility of its EU membership prospects, while credible membership prospects increase the likelihood of democratization. I claim that data from CEE are consistent with this argument. [ABSTRACT FROM AUTHOR]