Price Levels and Price Disparities in Slovenia

Egon Žižmond ()
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Egon Žižmond: Faculty of Management Koper, University of Primorska, Postal: Cankarjeva 5, p.p. 345, SI-6104 Koper, Slovenia, http://www.fm-kp.si/

Economia Internazionale / International Economics, 1992, vol. 45, issue 3-4, 364-377

Abstract: The aggregate level of Slovene producer and retail prices as compared with cor-responding Italian prices decreased during the period 1985 to 1988. The main causes for disparities were numerous ideological and political restrictions and the administrative regulation of the economy, which did not render possible the formation of balanced prices of production factors or hindered the application of certain production factors. This allowed relatively low prices for products of lower processing levels (and vice versa) compared with countries with market economy. The predominant part of price disparities in Slovenia was thus a result of systemic and economic political reasons (administrative prices, turnover tax rates, etc). We can conclude that changes of the economic system in Slovenia, which became an independent state, will also affect relative price levels. Therefore, we cannot form yet the development strategy on the basis of price disparities established.

Date: 1992
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