Commitment devices, opportunity windows, and institution building in Central Asia

recent years, such that investing in education and human capital increases the preferences for
property rights protection and more market-based institutional arrangements in order to ensure
that individuals can benefit from their human capital accumulation.

However, one should bear in mind that there is a second factor related to education which
can be linked to persistence of institutional settings. A large number of public and private
employees in Central Asia, still in key positions after the breakdown of the socialistic regime, were
educated under the socialistic system. It is obvious that a curriculum in socialistic book-keeping,
banking supervision, and legal treatment of property rights differed remarkably from what a
market-based economy demands. In this case persistence may simply arise from the complexity
of setting up market based institutions and policy makers’ lack of knowledge about how to
implement and to execute certain institutional arrangements. The accumulated knowledge of
these employees, therefore, does not assist them in executing their tasks and probably makes
redesigning institutions impossible.³

3 Openness, Commitment, and Economic Reforms

So far, preferences of individuals and politicians, alongside with the deficiencies in the education
system appear to be the major obstacles in the reform process in Central Asia, whereas the
³Vaclav Klaus (1990) summarised this as ”When we want to play chess, we must know how to play.”

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