Stabilization and Structural Reform in Czechoslovakia: An Assessment of the First Stage

Bijan Aghevli, Tessa Van der Willigen and Eduardo Borensztein

No 1992/002, IMF Working Papers from International Monetary Fund

Abstract: This paper analyzes the Czechoslovak reform program which was launched on January 1, 1991. Under this program, Czechoslovakia has taken decisive steps to establish a market economy, while achieving price stability and a viable external position through restrictive financial policies. But there has been a sharp decline in output. The eventual output recovery is predicated on completing structural market reforms, such as the development of financial markets and the safeguard of their stability, privatization of large enterprises, minimizing government interference with economic signals, and the imposition of the “hard” budget constraint.

Keywords: WP; interest rate; exchange rate; balance of payments; terms of trade; market economy; price jump; reform program; external shock; consumer goods; enterprise manager; price liberalization; enterprise sector; consumption expenditure; government consumption expenditure; Inflation; Privatization; Exports; Imports; Central and Eastern Europe (search for similar items in EconPapers)
Pages: 44
Date: 1992-01-01
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