Central and East European Economies in Transition [antikvár]

Introduction The initial experiences of systemic transformation of the countries of Central and Eastern Europe collectively known as the Five' have been mixed at best. In spite of significant country-to-country differences in their initial economic and political situations, pretransformation economic systems, and government policies, all of them are characterized by economic decline, increasing political conflict, and social strains. What is more, even at this point, there is for the most part no clear political, economic and, legal conception of the means for further transformation, and the credibility of the various government programs for economic stabilization is not beyond question. The difficulties are not at all surprising. Some early euphoria notwithstanding, to most analysts it was clear from the outset that positive change in the economic situation and systemic transformation would require more time than political turnabout. It is generally accepted that transition from a largely state-owned, centrally planned economy to a market economy with a private sector of significant proportions (what can be seen as the substance of systemic transformation) is an unprecedented task. As Stanley Fischer and Alan Gelb have put it, although most of the individual requirements for socialist economy reform have been faced before, in China, and in Latin American and African countries where the combination of a weak private sector, political monopoly, heavy policy-induced distortions and macroeconomic imbalance is not uncommon the challenge [in Central and Eastern Europe] is unique, in its system-wide scope, in its political and historical context and in the speed of desired reform (Fischer and Gelb 1991, p. 184). It is widely believed in the West that "things will have to get worse before they get better," and Central and East Europeans cannot really advance any strong arguments against this. What was unforeseen, however, was the speed and depth of the economic deterioration and the inability of the governments of the countries concerned, whether they had formulated some version of radical shock therapy or not, to control the decline or slow the accumulation of social and political tensions.^ The rapidity of the decline in economic activity and living standards and of the increase in the degree of uncertainty of existence for large segments of the population in the period following the political transformation from late 1989 through