Does Economic Transition Have an End?
25 Years after the Wall: How did the Fall of the Berlin Wall Change Our Lives?’ Edited by N. Levrat, P. Cebulak and P. Byston, Geneva: University of Geneva and Forum Carolus, pp. 101-131.
34 Pages Posted: 2 Jul 2015
Date Written: June 29, 2015
Economic transition is a process of change from a centrally planned economic system to a market-based economy. The process started with the fall of the Berlin Wall in 1989. There were no theoretical foundations and experiences for the process of economic transition. The neoliberal Washington Consensus suggestions of fast liberalisation and privatisation were often employed in the transition region, but failed to bring the expected fruits. Countries became rather leery about further reforms since 2005. The membership of the European Union brought certain positive changes and improvements in the economies of countries in Central and Eastern Europe. This has, however, happened at the cost: foreign debt went through the roof. The danger is that foreign debt may choke growth in the future, especially when rates of interest increase. The end of economic transition is not yet in sight.
Keywords: central planning, market economy, transition, Washington Consensus, debt
JEL Classification: P20, P30, P50, F02, F15
Suggested Citation: Suggested Citation