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The Collapse of Planning and the Troubled Transition

In: Aid, Trade and Development

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  • Constantine Michalopoulos

Abstract

The collapse of the Berlin Wall in 1989 and the subsequent breakup of the Soviet Union into fifteen independent states led to momentous changes in the global economy. The transition of the fifteen states of the former Soviet Union (FSU) and those of Central and Eastern Europe (CEE) from central planning to market led to massive disruptions in their economies and huge declines in production and incomes. It also created additional demands for assistance from the OECD countries and new challenges for the integration of these countries into the international economy. This chapter discusses the main issues in the transition from planning to market in CEE and the FSU. It focuses on two questions regarding the role played by foreign aid which had an important bearing on the future evolution of these countries: first, its impact on privatization, and second its support for their integration into the world trading system.

Suggested Citation

  • Constantine Michalopoulos, 2022. "The Collapse of Planning and the Troubled Transition," Springer Books, in: Aid, Trade and Development, edition 2, chapter 0, pages 97-132, Springer.
    • Handle: RePEc:spr:sprchp:978-3-030-96036-0_5
    DOI: 10.1007/978-3-030-96036-0_5
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