Cultural Determinism versus Administrative Logic ...

International Journal of Public Administration

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Cultural Determinism versus Administrative Logic: Asian Values and Administrative Reform in Kazakhstan and Uzbekistan Bruce J. Perlman & Gregory Gleason To cite this article: Bruce J. Perlman & Gregory Gleason (2007) Cultural Determinism versus Administrative Logic: Asian Values and Administrative Reform in Kazakhstan and Uzbekistan, International Journal of Public Administration, 30:12-14, 1327-1342, DOI: 10.1080/01900690701229475 To link to this article: http://dx.doi.org/10.1080/01900690701229475

Published online: 13 Dec 2007.

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Date: 25 May 2016, At: 19:51

Intl Journal of Public Administration, 30: 1327–1342, 2007 Copyright © Taylor & Francis Group, LLC ISSN 0190-0692 print / 1532-4265 online DOI: 10.1080/01900690701229475

Cultural Determinism versus Administrative Logic: Asian Values and Administrative Reform in Kazakhstan and Uzbekistan

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1532-4265 0190-0692 LPAD Intl Journal of Public Administration Administration, Vol. 30, No. 12-14, September 2007: pp. 1–28

Cultural Determinism Perlman and Gleason versus Administrative Logic

Bruce J. Perlman School of Public Administration, University of New Mexico, Albuquerque, New Mexico, USA

Gregory Gleason Department of Political Science, University of New Mexico, Albuquerque, New Mexico, USA

Abstract: Cultural explanations of development claim that the choices a nation makes are dependent upon the country's deeply held norms and values. When this argument is extended to the realm of administrative science, it suggests that values rather than formal institutions under certain circumstances exert a determining influence in administrative development. The truth of this general proposition implies that societies that have similar cultural foundations and which undergo similar external pressures can be expected to follow similar paths of administrative change. Is this general tendency borne out by empirical observation? The present article examines this expectation using empirical evidence from the experience of administrative reform in two Central Asian countries, Kazakhstan and Uzbekistan. The article argues that these two countries, while having similar culture values and norms as well as a common administrative legacy, followed very different paths of administrative reform during the first decade of post-communist reorganization. The descriptive analysis of the two cases provides evidence for the conclusion that policy choice rather than cultural values played a determining role in administrative change in the countries reviewed. This argument rejects the assumption of cultural determinism, but does provide a nuanced interpretation of the continuing influence of cultural values on the process of policy. Keywords: Administrative reform, cultural determinism, Asian values in Central Asia

Address correspondence to Gregory Gleason, Professor, Political Science Department, University of New Mexico, Albuquerque, New Mexico, 87131, USA; E-mail: [email protected]


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Proponents of the argument that “culture matters” in explaining social change and economic development argue that the choices a nation makes are dependent upon the country’s most deeply held norms and values.[1] When this argument is extended to the realm of administrative science, it suggests that cultural values rather than formal institutions play a determining role in administrative development. If this proposition is well-founded, it suggests that societies with similar cultural foundations would tend to adopt similar kinds of formal institutions and, further, that these institutions would tend to function in ways that conform to expected behavior patterns given the society’s mores, norms, and values. It also would imply that societies undergoing structural reorganization would find cultural factors to be more influential than situational factors. It implies that cultural values would have implications for progress through the various stages of the administrative reform process.[2,3] For advocates of best practice in public administration, the relationship between cultural factors and formal institutions of government is important. If the cultural hypothesis is well founded, it would imply a simple relationship between the cultural context, the formal institutions and administrative functioning. It would imply, among other things, that improvements in the effectiveness of administrative functioning could not efficiently be achieved by modifications of the formal institutions of government alone. The way in which these institutions function would be dependent upon antecedent cultural factors as represented in Figure 1. It would imply that administrative reformers should focus more on the relationship between cultural values and formal institutions than upon improvements in administrative functioning and practice. Ways of “insulating” the formal institutions from the influence of culture—for instance efforts to reduce family ties by requiring disclosure of consanguinity in hiring and promotion—would best be applied in the design of formal institutions rather than in the standard operating procedures and practice of day-to-day administration. How can we systematically test for the level, strength and direction of these influences? Systematic tests of specific hypotheses with respect to general propositions are best conducted on large samples across dimensions of time, space and culture. However, initial studies aimed at clarifying relationships are often usefully conducted on the basis of cases studies. This article analyzes the relationship among culture, formal institutions, policy choice and administrative change on the basis of case studies of two countries, Kazakhstan and Uzbekistan.

cultural values

formal institutions

administrative functioning

Figure 1. Cultural Antecedents of Administrative Change.

Cultural Determinism versus Administrative Logic

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CULTURE, INSTITUTIONS, AND ADMINISTRATION Theorists have long argued public attitudes toward politics and the role of the individual within the state—political culture—plays an important role in how individuals act.[4] More recently, the idea of political culture has been extended to the broader proposition that cultural values and norms have political content in influencing the way that individuals and groups assess, calculate, and act. Seen in this broad context, culture plays a role in specifying not only the relationship between the individual and the state but how the state organizes and legitimizes the collective efforts of individuals. The success of the Asian “Tigers” of South Korea, Taiwan, and Singapore in economic development in the 1970s and 1980s was interpreted in terms of the ideas of holistic Asian cultural values that were reflected not only in commercial interactions but in social interactions as well. The cultural hypothesis implies that cultural factors tend to be more influential than institutional or situational factors in affecting administrative change.[5] In contrast to approaches emphasizing the importance of cultural factors are those approaches that stress the role of formal institutions. Institutional theory is a broad field, drawing upon many disciplines, particularly economics, sociology, and political science.[6–13] But a common thread among institutionalists is the idea that individual behavior and collective outcomes are structured by formal institutions of government. Strictly speaking, an “institution” refers to a public organization that has the authority of the state behind it. But by extension, an institution is any set of rules, regulations, and prescribed set of behaviors that is stipulated by the public organization. In this sense, formal institutions are comprised by the collective set of abstract rules that specify individual and collective behavior, either directly through prescription and/or sanctions or indirectly through incentives and/or disincentives. Institutions formalize the distribution of incentives and disincentives in a society expressing the will of the state with respect to individual action.[10] Institutional theorists argue that the formal, hierarchical structures of government are superimposed over cultural and market-based economic factors in such a way as to shape the actions of individuals acting both individually and collectively. The simple upshot of the institutionalists’ argument is that “Change an institution, alter its rule or norms, and you change behavioral predispositions and agency outcomes.”[14] The institutionalists’ argument has direct implications for public officials engaged in the enhancement of the efficiency, effectiveness and equity of public administration. The adoption and success of best practices in administrative functioning directly depends upon the way in which formal institutions function. If we accept the definition that, in the words of Shafritz and Russell, “public administration is what the state does” then the effectiveness of the administrative process is directly related to the effectiveness of the formal institutions of government.[15]


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The five countries of Central Asia--Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan—became independent states as a result of the collapse of the USSR in 1991.[16] National independence in these states was a consequence of the Soviet break-up. This is surely a significant fact; but what may be even more significant in terms of traditions in the regions is the fact that none of these countries every existed prior to the Soviet period. Of course, the Central Asian regions had been populated for millennia, but no independent governments existed in anything even resembling the borders of the contemporary states. Each of these states was created during the Soviet period as part of a strategy to divide and conquer the common peoples of Central Asia. During the Soviet period, the Kazakh republic and the Uzbek republic were the largest of the Central Asian Soviet republics. Kazakhstan and Uzbekistan, like all the other Central Asian republics, were united by significant common cultural attributes, features, and traditions. The cultural unity of the region became particularly apparent as the Soviet Union went into the early phases of disintegration. During the entire Soviet period the political leaders of the Central Asian republics were prohibited from participating in regional congregations; they were permitted only to meet in communist party-sponsored convocations usually held in Moscow. But as the Soviet Union began to tremble, the Central Asian political leaders called for a regional “summit” meeting. The meeting took place in Almaty (then named Alma-Ata), Kazakhstan in the summer of 1990. The presidents of the five Central Asian republics issued a revealing communiqué. The document paid tribute to the deep and profound unity of the Central Asian communities. The communiqué observed in honorific tones that the fates of the Central Asian republics were intertwined by geography, by their related economies, and by the close “family relationship” of their common values, traditions, and cultural mores. As soon as this key point on the cultural unity of the Central Asian societies was made, the document proceeded unceremoniously to add that the borders of the existing Central Asian republics were “inviolable” and could not be changed by “anyone’s will” without the consent of the republics.[17] On the one hand, the leaders of the Central Asian republics were prepared, even eager, to recognize the underlying cultural unity of Central Asia. On the other hand, none of the leaders was prepared, even in principle, to question the idea of national self-determination. This contrast between “we are one” and “we are many” has continued to characterize the Central Asian countries since independence. Central Asian political and leaders and cultural have continued to emphasize both cultural unity and political independence in the region throughout the post-communist period. Prior to independence, these Central Asian countries had very virtually identical political and administrative institutions.[18–21] In most respects, the Central Asian countries started with the same institutional and administrative infrastructure: they achieved independence at the same time from the former



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Soviet Union of which they were client states; as former socialist states they did not have functioning market economies; their state and administrative organization was similar and their public servants were recruited for the same qualities and trained in the same systems using the same principles and premises; they had similar resource bases on which to rely. As the countries began the first stages of post-communist transition, the leaders of each of the Central Asian countries spoke out, at least on a rhetorical level, in favor of the establishment of democratic institutions and secular government.[22–24] Each of the countries adopted a constitutionally limited, representative form of government with a separation of powers and a legal and regulatory framework in accordance with international standards. As a part of this commitment to modernization, each of the countries undertook to adopt a modern public sector, characterized by the rule of law, limited and accountable government, balance between the public and private sectors, and a civil service administrative structure organized on meritocratic principles and enjoying protections from political influence in policy implementation. These decisions were based to a large extent in the emphasis on the political institutions of democracy and market economics as playing a determining role in structuring outcomes, a common assumption among many institutional theorists. Today, well more than a decade after the advent of national independence in these countries, it is clear that the governments of Central Asia have indeed succeeded in adopting many of the formal, institutional structures of western style democracy. But the countries have not succeeded in the more subtle yet more significant transition to the adoption of administrative process in accordance with international standards. The countries have adopted legislatures, yet none of the countries has succeeded in establishing a true, deliberative legislature with powers of the purse. All of the countries have adopted judicial systems for adjudication and dispute resolution, yet none of the countries has succeeded in creating the conditions for true judicial independence. All of the countries have adopted constitutional and legal statues that purport to safeguard the rights of individuals, minorities, and to protect due process of law, yet none of the countries actually has succeeded in establishing functioning protections for fundamental civil and human rights, including such basic freedoms as the right to due process, freedom of speech, freedom of assembly and freedom of religious belief. The countries have adopted the structural framework of a market economy, but in many cases the state has not created a space in which private enterprise could thrive as a result of individual initiative.[25] The countries have adopted professional bureaucracies charged with implementing state policy, but a true civil service system has not been established due to parochialism and preferential arrangements. The countries have adopted modern systems of budgeting and revenue, but they have not been able to introduce true transparency and public disclosure or even insulate line-level public finance officials from the predatory actions of from high-ranking officials.

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An explanation often offered for the failure of the countries to make more progress in the direction of administrative improvement is that aspects of Asian culture in the region have prevented the adoption of external, abstract, rule-based, policies and procedures, in favor of personalistic, relations-based habits of thought and practice. In other words, a culture of “Asian values”, as the argument goes, has played a more important role than formal institutions in structuring the outcome of the first decade of post-communist reform.

ASIAN VALUES IN CENTRAL ASIA As soon as national independence became a real possibility in the countries of Central Asia, the question of development strategy became one of the dominant issues in Central Asian political and economic dialogue. The idea of a distinctive development path soon emerged. In Kazakhstan the idea of “Eurasianism” became the leading conceptual framework for Kazakhstan state planners. In Uzbekistan the idea of the “Uzbek path” became the guiding framework for Uzbek officials.[26] Both Kazakhstan’s Eurasianism and Uzbekistan’s “Uzbek Path” drew heavily on the assumption that the countries were essentially Asian countries and that “Asian cultural values” would play an important role in the development of concepts of participation, legitimacy, and the functioning of government. According to Central Asian intellectuals and political leaders, the Central Asian countries had unique cultural traditions that would give substance to the ways in which Uzbekistan dealt with the challenges of development and change in the period of globalization. Many Central Asian leaders have stressed that the Central Asian states have more in common with their Asian neighbors than with their European neighbors, pointing in particular to example of Singapore.[27] Uzbekistan’s president Islam Karimov expressed it:[28] The spirituality we promote . . . ought to nurture in people’s hearts and minds faith in the future, love of the Motherland, humanism, courage, tolerance and fairness. This approach may seem to be “traditionalistic”. But is “traditionalism” a bad thing? In fact the traditional Oriental culture, which our people have been nurturing for thousands of years and which we seek to retain, differs a great deal from its Western counterpart . . . .Democracy may be “declared,” may be “imposed” from top to down, but in this way it will not become part of our real life. Democracy should become the value of society, and the value of every person in society. In this and in many other policy statements, President Karimov implicitly or explicitly draws a distinction between the “Anglo-Saxon” model and the



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Asian model. At the core of this distinction is the relationship between the individual and the state. Classical Anglo-Saxon conceptions of the state reflect stress the importance of the individual as a person voluntarily cooperating with other individual out of self-interest in such a way as to provide legitimacy to a limited state.[29,30] The Anglo-Saxon classical state plays a restrained role, acting as little more than broker and referee among parties while protecting from foreign threat and enforcing private property rights and contract law.[31–33] To assure that government is responsive to a large and broad class of undifferentiated actors in the polity, the classical state is abstract and rule-bound, rather than discretionary and personalistic. Precedents and rules, rather than favoritism and merit, underscore impersonal codes of action, providing prescriptions for individual behavior. The western model is based upon the assumption that the determination of individual rights is best played out in an adversarial process of open contestation, brokered by the rule of law and the near universal acceptance of the importance of the process as opposed to the outcome. The protection of due process is much more important than any single ruling or outcome. If the process of contestation is protected, the defeated parties always have an opportunity—and perhaps even an advantage—in returning to the contest at a later point. The American business model relies upon the preservation of impersonal, abstract legal rules to ensure even-handed, fair, and freewheeling competition. The Asian model rejects the minimalist conception of the state and the individual’s role within society. Confucian principles of filial piety emphasized rule by persons of moral authority over the rule of law, paternalism over legalism, and offered a formula for a unique approach to the relationship between modern man and the modern state. Marxist and socialist models of the state, for instance, called upon societal mobilization and internal redistribution to maximize social benefit, not individual benefit. In practice, the Asian model of strong government was associated with populism, import substitution, regulatory control of markets and redistributive goals. The Asian path was different from other competing approaches in that it was syncretic, binding together the interests of the state, the society, the family and the individual. The Asian model conceives of government as consisting in the first instance of personal obligation and duty; business relations depend in the first instance upon networks and social obligations. The western model stresses laissez-faire, open economics; while the Asian model relies on national strategies and actively supervises, monitors, and even regiments the competitors. The cornerstone of the Western model is individualism and self-interest; the cornerstone of the Asian model is loyalty and obligation. In one, independence is expected and opposition is considered a challenge. In the other disagreement is considered impolite; opposition is considered treachery. In the Central Asia countries many Asian cultural values are deeply rooted in the society. If these values are as influential in administrative change


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as the cultural school would lead us to believe, then those Central Asian nations sharing a similar environment should reach roughly the same structural adjustments in their administrative reforms. Thus, the political, economic, and geographic environment of Central Asia provides a unique test of the cultural proposition. Among the Central Asian countries, Kazakhstan and Uzbekistan are distinguished in terms of size and economic importance. In the following analysis we survey the administrative systems in these two countries, emphasizing in particular the process of policy choice. The two countries have become independent in circumstances that were very similar, indeed nearly identical. Yet the patterns of policy choice in the countries are very different.

THE CASE OF KAZAKHSTAN The capital city of Kazakhstan was host to the December 1991 conference of former communist party officials that produced the “Alma-Ata Declaration,” the legal instrument that officially brought about the end of the USSR. Kazakhstan was thus symbolically the resting place of communism and the birthplace of the post-communist order. Kazakhstan’s president, Nursultan Nazarbaev, had previously been a promoter of democratic change within the former USSR and, when the transition came, identified the new Kazakhstan government with the pro-market, democratic reform at an early point.[34] At the Coordinating Conference on Assistance to the New Independent States that took place in Washington in January 1992, U.S. President George Bush noted that “in Central Asia, President Nazarbaev . . . [is] . . . leading the fight for reform.”[35] Soon after independence Kazakhstan’s capital, Almaty, became the home for the largest international diplomatic community in Eurasia east of Moscow and west of Beijing. Soon after independence Kazakhstan took steps to integrate into the international community of nations, joining the United Nations in March 1992. Soon thereafter Kazakhstan joined the World Bank, the International Monetary Fund (IMF), the Asian Development Bank (ADB), and the European Bank for Reconstruction and Development (EBRD). Kazakhstan started the process of accession to the World Trade Organization (WTO). Kazakhstan initiated a series of bilateral discussions that led to bilateral and regional trade agreements. Kazakhstan was the initiator of the “CIS Customs Union,” an organization that attempted to implement the goals of the CIS founding documents by maintaining a “common economic space” throughout the former USSR. Kazakhstan was the initiator of the discussions that led to the Cholpon-Ata Regional Cooperation Agreement of April 1994 that pledged Kazakhstan, Kyrgyzstan, and Uzbekistan to observing the principle of maintaining transparent, open borders to facilitate trade and cooperation.



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Kazakhstan adopted a tradable currency in November 1993, liberalized prices, and started privatization of major sectors of the economy including industry, telecommunications and energy. Kazakhstan lifted virtually all subsidies on consumer goods in September 1994 and phased out many industrial subsidies before the end of the year. Kazakhstan commenced the process of balancing the public and private sectors with a series of major reductions in force of public employees and privatization of state-owned public service facilities. During the early years of independence Kazakhstan moved quickly to establish a reasonably stable legal and regulatory structure for commerce and civil rights. Kazakhstan adopted a progressive Civil Code, establishing the framework for commercial transactions and property rights. Kazakhstan adopted a modern banking system, a securities exchange system, bankruptcy legislation, and a system of public utilities management. Kazakhstan established the framework for a new system of government fiscal management, with a modern system for managing public external debt, a new tax code and a new system of tax administration. During 1994 Kazakhstan experienced very high inflation rates, although this stabilized in 1995. During 1995–1996 the “expansion program” under premier Akezhan Kazhegeldin was producing good results, but the Asian crisis shook commodity prices, forcing the price of oil down by nearly 40 percent and non-ferrous metal prices down by margins as high as forty percent. Inflation rose again in 1998 in association with the Russian financial collapse. Kazakhstan’s high degree of reliance on Russian Federation buyers for oil, gas, metals, meant that the 1998 financial crisis in Russia had immediate impact on Kazakhstan’s foreign sales. Given that oil and metals constitute roughly 60 percent of Kazakhstan’s exports, the country’s terms of trade deteriorated substantially and quickly. In response, Kazakhstan authorities initially tightened fiscal policies in mid-1998, restraining government spending and borrowing but relaxing these policies again as presidential elections approached in January 1999. Despite these economic setbacks, Nazarbaev and his government continued to maintain support for post-communist reform. At the critical juncture following the collapse of financial markets in Russia, when some Central Asian politicians were arguing for the adoption of a neo-mercantilist “Asian path,” Nazarbaev held firm to the reform programs, pledging “to continue the promising advances toward an independent, open and free market economy.”[34] Kazakhstan has a unitary form of administration. Kazakhstan’s first constitution was adopted in 1937 and was followed by a new constitution in 1978. The first post-Soviet constitution was adopted in 1993. A popular referendum supported the introduction of a new constitution in August 1995. Constitutional amendments were adopted in October 1998. Following the 1997 territorial reorganization that merged some provinces (oblasts), the government has been structured along the lines of the national government with sixteen territorial


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divisions. Today Kazakhstan has 14 oblasts and two cities of oblast-level importance. The most important cities in Kazakhstan are those that are home to significant industrial or natural resource enterprises. The structure and functioning of the administrative system in Kazakhstan has changed continuously over the period of post-communist development. The early post-Soviet ministries gave way to privatization under the hastily established State Committee for Privatization. This gave way in the period 1997– 2000 to a specially designed temporary lead institution in reform called the Agency for Strategic Reforms. This too gave way to a new configuration of central administrative organs in 2001. In September 2004 President Nazarbaev issued a resolution on reform of the provincial level administrative apparatus.[36] The resolution called for eliminating “branch” (that is, functional) administrative divisions at the provincial level and shifting these tasks to the local level. The Kazakhstan government has been broadly successful in designing and carrying out policies at a national level in both comparative and absolute terms. According to the International Monetary Fund World Economic Data Base, Kazakhstan’s GDP growth was over 13 percent in 2001 and remained at nearly 10 percent for 2002 and 2003, declining only to 8.5 percent in 2005. Real incomes increased during this period for a large portion of the population. While sectors such as agriculture did not participate fully in the country’s rapid economic growth, the growth in the mineral sector and in energy was also accompanied by growth in the service sector. Kazakhstan’s government administration deserves much credit for these changes and has been lauded by spokespeople from international business and international organizations who regard Kazakhstan as a new model for the developing world. At the same time, Kazakhstan’s government has been criticized for attempting to monopolize political power. Kazakhstan’s president himself has been criticized for giving in to clanism and nepotism that could lead to consequences similar to that of Suhartoism in Indonesia. Nazarbaev has acknowledged this as a problem. Addressing the Kazakhstan parliament in Astana on November 3, 2004, Kazakh President Nazarbaev observed:[37] The further de-monopolization of the economy and the creation of a level playing field for all enterprises and the development of healthy competition is an indisputable requirement for the effective development of the economy, above all for small and medium enterprises. Today the high level of concentration of the economy is obstructing this. About ten “Mega-holdings” — or to put it simply, “oligarchs” — control practically eighty percent of the economy’s GDP. Moreover, in addition to their basic functions their affiliates carry out many activities outside their basic business purposes. This leads to ineffectiveness and a lack of transparency in their activities. They, as a rule, are against the emergence of competitors, and thus inhibit the development of small and medium business.



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To address the problem of the influence of the Kazakh “oligarchs,” Nazarbayev announced the creation of new government managed holding companies that would take control of shares in the strategically important enterprises and large enterprises. The president said that this solution would provide for professional and effective management of the companies and lead to greater coordination of the government companies. The openness of Kazakhstan’s markets to foreign competition is paralleled by the openness of the political system. In no other Central Asian country would the president be prepared to make such frank and candidate an assessment of the political situation in the country. In no other Central Asian country is there such open debate and contestation over policy alternatives.

THE CASE OF UZBEKISTAN At the time of independence, the Uzbek economy was more diversified than the economies of the other four Central Asian states. It included agriculture, light industry, heavy industry, and important branches in primary commodities. Following the disintegration of the Soviet Union, Uzbekistan’s economy was insulated from much of the economic decline that afflicted other former Soviet states due to its labor-intensive economy based on agriculture and mineral extraction. The Uzbekistan government, under the leadership of President Islam Karimov, quickly embraced the idea of market based commercial relations, announcing that the country would be “pro-business.”[28] Many elements of the Soviet system were quickly rejected. But at the same time many elements of the Soviet-era administrative system merely were replaced by an indigenous, state-controlled administrative system that was itself top-heavy and stultifying. In the years to follow, the Uzbekistan government pursued foreign economic policies that stressed a gradual, step-by-step approach to the adoption of reforms. This conservative transition strategy emphasized establishing self-sufficiency in energy and food grains, exporting primary commodities, particularly cotton and gold, and creating an internally-oriented services market. In September 1996, in connection with a shortfall in foreign reserves, the Uzbekistan Ministry of Finance imposed a system of import contract registration. The goal of the system was to ensure that scarce foreign currency was used primarily to import capital rather than buy consumer goods, particularly luxury goods and items. However, in practice the system severely limited the availability of foreign exchange for all sectors of the economy and retarded economic activity. In subsequent years the Ministry of Finance periodically acted to make the system yet more rigorous as foreign currency reserves continued to dwindle.[38] Foreign companies in Uzbekistan reported that the currency restrictions constituted the most serious obstacle to doing business in the country.


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In 2001 the Uzbek government renewed its relationship with the IMF by signing a Staff Monitored Program (SMP) Agreement in December 2001. In accordance with the agreement, Tashkent implemented ambitious macroeconomic reforms, including currency conversion and agricultural reforms. In September 2002, however, an IMF review found the Uzbek government’s performance to be “uneven.” The Uzbek government responded with additional reform steps and assured the IMF that it would undertake the proposed structural reforms and policy correctives in order to secure an IMF Stand-By Agreement—an agreement to provide financial support to the Uzbek government as it undergoes the market transition. In November 2003, the IMF announced that Uzbekistan had formally agreed to comply with the IMF Charter restrictions on multiple currency exchange rates, signifying the government’s intention to re-enter the international financial community on parity terms. But the currency arrangements during the period 1996–2003 and the fiscal environment they created, had the effect of debilitating the private sector while creating incentives for unresponsive and non-transparent national administration. During this period, local administration in Uzbekistan continued to be depende nt upon the central authorities. In terms of territorial organizations, Uzbekistan has a centralized political system of government with ultimate authority resting at the national level. Within this system, there are twelve veliyats (provinces), one autonomous region, and one city government (Tashkent). The president has the power to appoint and dismiss the highest executive officers in the veliyats, the Hokims. All policies made and enforced at the veliyat level must comply with national laws. This also holds true for policies made and enforced at the level of the Autonomous Republic of Karakalpakstan. Hokims serve at the pleasure of the President. In turn, local officials serve at the pleasure of the hokims. The Uzbek financial and budgetary system mirrors this arrangement. The Uzbek financial system is unitary. Veliyat and municipalities are responsible for collection of government revenue (taxes and other mandatory payments) but expenditure decisions are made at the national level. Very few categories of legitimate own-source revenue are available to local officials for purposes of local policy programming. On the other hand, local officials wield exceptional interference powers. Lower level bureaucrats, firms, and private parties that do not see eye-to-eye with local political officials find great difficulty in acquiring the necessary government approvals, licenses, or permits to carry out their activities. Official government positions are highly sought after. Professional training institutions such as the Academy of Public Administration provide training in the theory and practice of government. However, the selection of government officials has not yet been shifted to a meritocratic basis. The need for a more responsive and more effective administrative system is recognized by the government. In June 2003 President Islam Karimov issued a directive establishing a special commission to draft reform measures.



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In December 2003 a presidential decree officially endorsed the administrative reform measures and specified that they be implemented by March 1, 2004.[39] Uzbekistan’s administrative reform was officially designed to reduce the role of the state, reorganize government functions and processes in accordance with the demands of liberalization, and bring into existence clear lines of demarcation between the public and private sectors. But the overall effect of the reform has been merely to restructure some administrative units and reassign others. More than a decade after independence, the administrative system is far from efficient, effective, or equitable. Furthermore, the complications caused by the political retrenchment following the revolutionary transformation in Uzbekistan’s northeastern neighbor of Kyrgyzstan, suggest that administrative progress has been even further compromised by the Uzbek government’s counterinsurgency programs aimed at eliminating political opposition.[40,41]

CONCLUSIONS In the present era of globalization, the rise of international standards, and the importance of striving for best administrative practice, theorists and practitioners in international administration frequently seek to simultaneously emphasize both efficiency and equity criteria. Efficiency criteria often may be expressed in terms of ratios between inputs and outputs. But equity criteria often require the administrator to comprehend administrative functioning in terms of the logic of cultural values. Any analyst of administrative functioning who is sensitive to the role of cultural differences in the policy process—that is anyone who has ever worked for an extended period in an administrative capacity in a foreign cultural context—is aware that public choice always takes place in the context of particular social values. This is as true of the most routine and mechanical administrative choices as it is of the most significant national decisions on a policy level. But how culture interacts with formal institutions is often complex and easily misinterpreted. The descriptive analysis of the cases of Kazakhstan and Uzbekistan in this survey provided evidence that Central Asian cultural values, formal institutions, and situational factors exerted roughly uniform influences on the two countries during the past decade and a half of independence. Yet during this period these countries followed very different patterns of administrative development. Accordingly, we have concluded that policy choice rather than cultural values played a determining role in administrative change in the countries reviewed. Moreover, this survey suggests that the effect of cultural values upon administrative functioning is not uniform or constant. The culture and institutions are elements in broader political and administrative processes. To isolate culture as a variable is to suppress many interaction effects among the different


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intervening variables. In light of this, we propose that a productive line of thought for future research is to focus on those factors that influence the way culture and formal institutions interact in practice. A promising place to start is the political process. The political process consists of the strategies of the individual actors in the public sector, ranging from the macro-incentives of the leaders on the national level, to the mezzo-incentives of the leaders on the policy making level, to the micro-incentives of the administrators on the implementation level. For administrative theory to develop a robust and yet clearly specifiable understanding of the role of culture in administrative process much more research is needed on the politics formal public institutions in cross-cultural contexts. Theory building would benefit from studies with a specific focus on how the self-promotion strategies of leaders, policy makers, and administrators interpret cultural values in the context of specific formal institutions. Theory building would benefit most from theoretically driven, carefully specified, replicable, empirical studies with cross-national scope.

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31. Alchian, A. A.; Demsetz, H. The Property Right Paradigm Journal of Economic History 1973, 33(1): 16–27. 32. Demsetz, H. Toward a Theory of Property Rights. American Economic Review, 1967, 57(2), 347–359. 33. Coase, R. H. The Nature of the Firm. Economica, 1937, 4, 386–405. 34. Nazarbaev, N. Kazakstan-2030: Prosperity, Security and Ever Growing Welfare of All the Kazakstanis; Ylim: Almaty, 1997. 35. U.S. Department of State. Dispatch, 1992, 3 (4), 57–60. 36. Resolution of the Government of the Republic of Kazakhstan of 4 October 2004 (No. 1022) “On the Model Structure of Local Government of the Republic of Kazakhstan.” 37. This statement appeared in the Russian language state-controlled daily newspaper, Kazakhstanskaya Pravda (4 November 2004). 38. The bureaucratic burden of maintaining strict currency controls can be expensive and it unavoidably creates an unfavorable climate for trade. An overvalued currency tends to channel trade into narrow and more easily managed sectors. It thus may appear to offer a solution to capital flight. However, there are great efficiency losses associated with currency overvaluation. It requires strict regulation of financial transactions, imposing a heavy burden of monitor and sanctions. Well-connected parties with access to cheap, government-financed foreign exchange and import licenses benefit greatly from this situation. These parties can be expected to lobby to maintain the situation despite great efficiency losses and the corresponding damage to the public interest. 39. Presidential Decree 3358 of 9 December 2003. 40. http://www.jamestown.org/. (Accessed 15 February 2005). 41. Gleason, G. Karimov Vows to Head Off Orange Revolution in Uzbekistan. Eurasia Daily Monitor, 2005, 2 (13).