The Prevailing Forms of Crisis in Soviet-Type Economies

Abstract

The long term tendency of a decline in growth that appeared during the beginning of the sixties, revealed itself very openly in the middle of the seventies, and ended by emerging as a genuine economic crisis in the beginning of the eighties. Apart from the extreme cases of Poland (with its acute social crisis) and Romania, the whole region is confronted by obvious economic difficulties reflected in converging statistical trends (Fig. Nos. 1 to 3 and Table 1). Years of successive bad harvests in agriculture, have created shortages of foodstuffs at times or have led to rationing measures as in Poland, USSR and Romania. Industrial growth declined appreciably, while productivity decreased in all the countries. Despite statistical underestimation of effective price increases, an open inflation appeared in the official retail price index of all the countries since 1976, apart from Poland and Hungary, where it had been a phenomenon of long standing. Inflation equally in the "second economy", whose dimensions have increased rapidly of late.