Transition in Eastern Europe: What are the issues?

Abstract

Given the sheer magnitude of literature on transition in Eastern Europe, which has evolved over the last years, one should have thought that the answer to the question of what constitutes the “essence” of transition is rather straightforward. When so much is written on a particular issue, it should be taken for granted that the problem at hand is well-defined and sufficiently circumscribed. And indeed, despite all controversies, there seems to exist a fairly broad consensus as to what the fundamental dimensions of transition are, namely institutional reforms, macroeconomic stabilisation, privatisation, liberalisation and restructuring (cf. Summers 1992). Less unanimity exists with regard to the relative importance of these aspects or the speed and the sequencing of reforms. But on the whole it appears as if the problem of transition were now fairly well-understood and could be formulated in a very operational way. Certain themes, like, e.g., macroeconomic stabilisation, privatisation or price liberalisation are recurring again and again in the literature with only minor variations. There also is no lack at all of very elaborate discussions of the intricacies involved in all these issues, including some very detailed and sophisticated policy recommendations. In this respect, the “economics of transition” does indeed present itself as a fairly well-defined field of research.