7 Pages Posted: 14 Dec 2005 Last revised: 27 Feb 2012
Official economic statistics reveal that Russia's economic system has continually contracted since 1989. Indeed, by the end of 1996 the Russian economy was basically half the size that it was in 1989 - a steeper fall than what the US experienced during the Great Depression of the 1930s. The Russian people have endured great economic hardship over the past decade with an estimated 22% of population now living below the official poverty line. Thus, the period of so-called market reforms in Russia does not show obvious improvements in the well being of its citizens. This has led to an emerging consensus within the professional and popular literature which argues that the triple transition - transforming the economy, the polity, and the national psychology - is too difficult to be left to the market. In contrast to this argument, we contend that it is precisely because the transition is so complicated and so important that market forces must be allowed to play the crucial role in the transition.
Keywords: B53, P21, P31
JEL Classification: Institutional Transition, Socialism, Collapse, Economic Reform
Suggested Citation: Suggested Citation
Boettke, Peter J. and Leeson, Peter T., Is the Transition to the Market Too Important to Be Left to the Market?. Economic Affairs, Vol. 23, 2003. Available at SSRN: https://ssrn.com/abstract=869140