Under what conditions do governments, employers, and unions enter formal policy agreements on incomes, employment, and social security? Such agree ments, widely known as social pacts, became particularly prominent during the 1990s when European economies underwent major adjustment. This article seeks to explain national variation in adjustment strategies and specifically why concerted agreements were struck in some countries but not in others. A fuzzyset qualitative comparative analysis of 14 European countries is employed to assess main arguments about the emergence of pacts. The analysis yields two key findings. First, although prevailing arguments emphasize Economic and Monetary Union-related pressures, or alternatively unemployment, these factors were neither necessary nor in themselves sufficient for pacts to materialize. Rather, a high economic "problem load" appears to be causally relevant only when combined with particular political and institutional conditions, namely, the prevalence of electorally weak governments and/or an intermediate level of union centralization. Second, the analysis refines existing multicausal explanations of pacts by demonstrating three distinct, theoretically and empirically relevant causal pathways to concerted agreements.

Using new data, this article examines the effect of employment protection legislation (EPL) on aggregate and youth unemployment in advanced economies and Central and Eastern Europe during 1980–2009. The results offer no clear support for the argument that EPL is a cause of unemployment. Although EPL reaches statistical significance at conventional levels in some models, the results are sensitive to small changes in the sample or the use of alternative estimators. While the analysis suggests some scope for complementary reforms of EPL and the tax wedge in tackling youth unemployment, the findings on the whole indicate that government efforts to tackle unemployment by deregulating EPL alone may well be futile.

The article offers an explanation for variations in the effectiveness of trade unions to obtain legislative and policy concessions in peak-level tripartite negotiations in post-communist East Central Europe. It shows that standard interpretations for such variations-focused on structural legacies, modes of transition, political cycles and institutional differences-cannot account for the problem at hand. Instead, I argue that the sources of these variations are to be attributed to distinct paths of state-labour relations, which are the product of continuous strategic interactions that crucially depend on power dynamics between the main actors. To present a mechanism through which these paths evolve, the article sketches a model of government-union interactions that combines institutional and behavioural variables. I propose a set of hypotheses regarding the conditions that determine initial choice of strategies and factors that influence continuation or modification of these strategies later on. By analysing the cases of the Czech Republic, Hungary and Poland, the article further illustrates how these interactions shape tripartite institutions in such a way that they start reflecting accentuated power disparities between the contending actors, thereby limiting future choice sets for weaker actors.

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