The Strategy of Transformation to a Market Economy

Jan Adam
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Jan Adam: University of Calgary

Chapter 1 in Social Costs of Transformation to a Market Economy in Post-Socialist Countries, 1999, pp 3-10 from Palgrave Macmillan

Abstract: Abstract After the collapse of the socialist system, Poland and Hungary accelerated their march to a market economy. The Czech Republic (CR) (up to January 1993 the Czech Republic was an integral part of Czechoslovakia [CSR]), where market institutions barely existed, made fast changes in order not to remain behind its neighbours. The transformation was preceded, but mainly accompanied, by a large volume of literature. Most of the literature favoured a radical strategy which is nowadays known under the name neo-liberalism.1 Considering the objective internal and external conditions which existed at that time, this was practically the only possible strategy. Of course, there were available alternative strategies to the neo-liberal, but they did not have a chance in Europe, because they did not have the support of the powerful international financial institutions. In addition, the political classes which came to power as a result of the collapse of the socialist system came under the influence of neo-liberal ideology. And finally, some of the alternative programmes did not have an operational plan. The neo-liberal ideology was not endogenous; it was brought into the subject countries, mainly by East and Central European scholars visiting and studying at Western universities, primarily American, where the teachings of M. Friedman and F. Hayek have a large following among professors of economics. It had already spread quickly before the socialist system collapsed.

Keywords: Monetary Policy; Market Economy; Foreign Trade; Domestic Currency; East European Country (search for similar items in EconPapers)
Date: 1999
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-50087-7_1

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DOI: 10.1057/9780230500877_1

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