The Polish Growth Miracle: Outcome of Persistent Reform Efforts

Quaderni DSE Working Paper No. 822

45 Pages Posted: 5 Apr 2012

See all articles by Hartmut Lehmann

Hartmut Lehmann

University of Bologna - School of Economics, Management, and Statistics; IZA Institute of Labor Economics

Date Written: April 5, 2012

Abstract

Since the beginning of transition in 1990 from a centrally planned to a market oriented economy, the performance of Poland’s economy has been outstanding if we take GDP growth as our measure. In our opinion it is not specific reforms that can explain this performance but the radical (“big bang”) reforms at the beginning of transition in conjunction with persistent efforts during the two decades by all governments, no matter what their political orientation, to keep on a reform path. Reforming a centrally planned economy that has very serious macroeconomic disequilibria implies reforms that can be done immediately but also structural or systemic reforms that require years to implement. Both types of reforms will be discussed. In a democratic context reforms can only be undertaken in a sustained way if a majority of voters favours such reform efforts. Even when reform-friendly governments were voted out of office in the Polish case, the new governments in Poland never reversed reforms undertaken by the previous government. This continuous reform stance over two decades is the main cause of the Polish growth miracle. The reasons for the ability of Polish policy makers to pursue economic and administrative reforms in spite of short-run costs to large sections of society will be discussed extensively.

Keywords: Policy Making, Transition Economies, Political Economy of Reform, Poland

JEL Classification: D78, J40, P20, P26

Suggested Citation

Lehmann, Hartmut F., The Polish Growth Miracle: Outcome of Persistent Reform Efforts (April 5, 2012). Quaderni DSE Working Paper No. 822. Available at SSRN: https://ssrn.com/abstract=2034846 or http://dx.doi.org/10.2139/ssrn.2034846

Hartmut F. Lehmann (Contact Author)

University of Bologna - School of Economics, Management, and Statistics ( email )

Piazza Scaravilli 1
40126 Bologna, fc 47100
Italy

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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