The fall of communist regimes throughout eastern europe and the transition to democracy and private enterprise, there, rank among the most dramatic and important political and economic developments of recent decades. In addition to their obvious international significance, these efforts at developing democratic institutions and market mechanisms offer unique opportunities to better understand how democracies and markets arise, how they survive or why they fail, and how they are related. This award supports innovative research designed to better understand the transition from authoritarian and socialist regimes to democracy and private enterprise through controlled comparisons of the ongoing transitions in Hungary and Poland. Specifically, this project tests two theories of the development of democracy. The traditional or structural determinist theory holds that the development of democracy invariably requires the existence of a variety of social and economic preconditions such as relatively high levels of economic development and an established middle class. An alternative and more recent theory holds that there are many different types of democracy and many different paths to their achievement. This social interactionist view agrees that social structure is important but believes that the effects of social structure are contingent upon the types of political institutions that develop and the types of strategic choices which political actors make during the period of transition. To test these alternatives, the transitions to democracy in Hungary and Poland will be compared. Hungary and Poland represent two nations with very different social structures which have followed similar processes of negotiated rather than revolutionary change but producing very different institutional and policy outcomes. Thus they provide an unusual opportunity to assess the effects of social structure on the development of democratic institutions and market mechanisms. The Principal Investigator for this project is a highly talented young scholar whose previous work in Hungary has provided a rich data set that will greatly facilitate completion of this important research.