Stabilization and Growth in Transition Economies: The Early Experience

Stanley Fischer, Ratna Sahay and Carlos Vegh

Journal of Economic Perspectives, 1996, vol. 10, issue 2, 45-66

Abstract: The authors analyze the growth and stabilization experience in twenty-six transition economies in Eastern Europe, the former Soviet Union, and Mongolia for the period 1989-94. Inflation rates have declined significantly in most countries following an inflation stabilization program. Typically, stabilization has been followed by growth within two years; and growth does not occur without stabilization. Reducing inflation thus appears to be a precondition for growth. An econometric analysis of the short-run determinants of inflation and growth illustrates the key roles of fixed exchange rates, improved fiscal balances, and structural reforms in spurring growth and lowering inflation.

JEL-codes: P20 (search for similar items in EconPapers)
Date: 1996
Note: DOI: 10.1257/jep.10.2.45
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Citations: View citations in EconPapers (202)

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Related works:
Journal Article: Stabilization and Growth in Transition Economies: The Early Experience (1997)
Working Paper: Stabilization and growth in transition economies: The early experience (1996)
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