The Transition Economies after Ten Years

By Stanley Fischer, Ratna Sahay. Social Science Research Network, 2000

347 citations recorded by the source corpus.

While output declined in virtually all transition economies in the initial years, the speed and extent of the recovery that followed has varied widely across these countries. The contrast between the more and less successful transitions, the latter largely in the former Soviet Union, raises many questions about the relative roles played by adverse initial conditions, external factors, and reform strategies. This paper summarizes the macroeconomic performance of the transition economies. We first review the initial conditions confronting these economies, the reform strategy that was proposed, and the associated controversies that arose a decade ago. We then account for the widely different outcomes, highlighting the role of exogenous factors and the macroeconomic and structural policies adopted by the countries. We find that both stabilization policies and structural reforms, particularly privatization, contributed to the growth recovery. We also conclude that the faster is the speed of reforms, the quicker is the recovery and the higher is growth.

Subfields: Accounting, Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/e2c3242408c4d6e2ea851d9cacc1206f4fcad39c

Citations in the corpus

• Recovery and Growth in Transition: A Decade of Evidence (2001, neutral): “Fischer and Sahay ( 2000 ) conclude that the length of communism and distance from Western Europe plus other initial conditions " go far in accounting for performance .”
• Reforms and growth in transition: re-examining the evidence (2006, neutral): “Most papers, e.g., Fischer and Sahay (2000) and De Melo et al. (2001), find that different starting points are important for economic performance, particularly during the first years of transition.”