Transformation economy

from Wikipedia, the free encyclopedia

As a transition economy refers to the economies of countries that are in transition from a centrally planned economy to a market system are. A distinction must be made as to whether the economic transformation process is also accompanied by a political transformation , ie a transition from a totalitarian or authoritarian to a democratic system, or whether the political system remains (almost) unchanged.

Characteristics of transition economies

Since the collapse of the Soviet Union and the dissolution of the Council for Mutual Economic Aid (Comecon) , the states of Eastern Central Europe (see Visegrád States ) as well as Eastern and Southeastern Europe, but also many states in Southeast Asia with varying degrees of willingness to reform, have endeavored to adopt the socialist planned economy to overcome and build market economy structures. Some European states have now largely successfully completed the transformation process. A visible sign of this was their accession to the European Union in 2004 and 2007.

Measured in terms of economic power, their national income and their infrastructural development, these states are now comparable to advanced developing countries and can therefore be classified as emerging economies . Other states, such as B. Slovenia , can now be compared with the industrialized countries of Western and Southern Europe.

Despite similar indicators with regard to economic strength and infrastructure, the transition countries still differ considerably from the emerging countries, which is why they are usually shown separately. As a rule, they show a significantly higher level in various social indicators (e.g. education, health care) compared to the Asian and Latin American emerging countries. There is also a fundamental difference in the causes and in the course of the industrialization process. The focus is not on the industrialization process per se, but rather on the modernization of industrial structures. The degree of industrialization of these states at the beginning of the transformation corresponded to that of the western industrial nations, in some cases it even exceeded it. The transformation started with a dramatic economic and then also a social “transformation shock”.

After the economic collapse, there were further setbacks for some countries, so that indicators for real developing countries emerged, especially from an economic point of view. This is often related to a politically justified reluctance to reform ( Belarus , Ukraine ). The Central Asian and Transcaucasian CIS states are also to be classified as real developing countries . B. Azerbaijan and Uzbekistan .

In some developing countries that were previously organized according to a planned economy, the transformation process and industrialization coincide, so that through the transformation process they become emerging countries; this applies to the (formerly) communist states of Southeast Asia, v. a. for Vietnam , in the future possibly also for Laos and Cambodia (see also flying goose model ).

Economic transformation measures

Price liberalization

In planned or central administration economies, prices are or were often set by politically motivated decisions, e.g. B. the extremely low prices for housing and basic food. In order to set the market economy process of price formation in motion, price fixing will be lifted in the course of the transformation process; Since the fixed prices were generally prices below the market clearance level, the price liberalization usually led to a significant price increase. In the initial phase of the transformation process, this led to hyperinflation in many countries with inflation rates of e.g. T. several hundred percent, z. B .:

  • in Poland: 585% (1990)
  • in Bulgaria: 334% (1991)
  • in Romania: 210% (1992)

Economic decentralization

In order for companies to be able to base their decisions on the market and on achievable profits, they must be freed from planning specifications and their economic autonomy strengthened.

stabilization

In addition to inflation as a result of price liberalization, currency substitution and the decline in the external value of the currencies of many transition countries led to monetary and currency policy imbalances, which were countered by measures such as the establishment of an independent central bank or a currency board .

Another stability problem was the rapidly increasing national debt, because at the same time tax revenues collapsed and the social transformation problems led to increased government spending.

privatization

In order to set a market-driven, competitive allocation process in motion, state monopolies were broken and start-ups permitted or promoted. Most of the state-owned companies have been privatized using different forms of privatization:

  • selling to (mostly foreign) investors
  • the issue of share certificates to the population ("coupon privatization"), e.g. B. on a larger scale in the Czech Republic
  • the sale to former managers

Foreign trade liberalization

In addition to the liberalization of foreign trade, e.g. For example, the abolition of a state monopoly on foreign trade, the movement of capital has also been facilitated by abolishing capital controls, introducing a convertible currency and allowing direct investment .

Deregulation and competition policy

In addition to fixed prices and planning specifications, a large number of regulations hindered the emergence of markets for goods, services, labor and capital; At the same time, however, there was a lack of competition policy instruments to prevent the renewed emergence of monopolies.

The abandonment of a previous employment guarantee and the deregulation of the labor markets led to the hidden underemployment in many planned economies turning into open unemployment. This made the introduction of market-compatible labor market policy instruments, e.g. B. Unemployment insurance, job placement, required.

The example of the transformation process in East Germany: Exchange of the old nomenclature

Compared to other transition economies, the market economy in East Germany was introduced particularly quickly . While the Eastern European countries experienced a transition and experimentation phase in the form of the shadow economy , a political objective prevailed in Germany, which promoted the alignment with West German standards and a comprehensive privatization of former state-owned companies without regard to the old economic elites . However, these intensified modernization and competitive conditions did not lead to the expected structural alignment. In retrospect, it becomes clear that the East German economy has neither got off the ground faster nor better than other transition economies, but has been permanently affected by an industrial crisis.

The Privatization Policy of the Treuhand: Colonization by West German Capital?

The privatization policy of the Treuhandanstalt , which privatized around 15,000 companies in a period of five years and ultimately offered 10,000 company units on the market for corporate control, set the course for a comprehensive replacement of the old nomenclature . Only about one in four company units became the property of East German persons or companies. Therefore, in most cases - and in contrast to the transformation process in other Eastern European countries - socialist managers did not become owners .

The fact that the much-vaunted “colonization” of the East German economy by West German capital did not occur can be traced back to a large number of regional start-ups by East German entrepreneurs. If the small companies are included in the calculation, only 11% of all East German companies were in West German ownership in 1999. The greatly reduced number of positions in middle management could still largely be filled by East German executives. However , East Germans are severely underrepresented in large corporations and among major shareholders .

The social structure of top managers after reunification

The social origin of the new East German elite reveals tendencies that can be seen as the result of a selection process that promoted advancement to leadership positions. Before the reunification, the new top managers mostly held senior positions in the middle management of the combines and were able to achieve considerable increases in positions after the reunification. In the industrial sector , for example, these positions are filled by male academics who are on average between 45 and 50 years old and who have a degree in science or technology. In this respect, East Germany does not differ very much from other transition economies.

Comparison with other Eastern European transition economies

As far as age , educational level and gender are concerned, there is no East German “special route” in the recruitment of economic elite positions . However, while in Eastern Europe the old elites often also provided the new elites, there was - due to reunification - no such continuity in Eastern Germany:

“In 1993, 51 percent of the new elite in Russia came from the old nomenclature, in Poland it was 40 percent, in Hungary it was still 33 percent. This continuity is most evident in the economic sector, where in 1993 in Russia 53 percent, in Poland 51 percent and in Hungary still 35 percent of the new economic elite came from the old economic elite. Reunification prevented such an elite continuity for Germany. The new or vacant positions went to members of the former sub-elites [≈ middle management] or western managers, but not to the old elites. "

- Markus Pohlmann : Economic Elites in East Germany , p. 99.

The example of the transformation process in Poland: The Balcerowicz Plan

The beginning of economic reform efforts in Poland is marked by a message from the Polish Finance Minister and Deputy Prime Minister, Dr. Leszek Balcerowicz , developed plan. The aim was to make a quick change from the planned to the market economy. The economic starting point at the turn of the decade 1989/90 was a shortage of supply, queues of buyers, a double currency, a flourishing black market and hyperinflation . The latter was even 149% in the fourth quarter of 1989 compared to the previous quarter. The process development was therefore not short-term and can be described as extremely complex and uneven.

The economic problem should also be tackled in two phases. In the first phase, the aim was to reduce hyperinflation through stabilization measures such as reducing government subsidies and minimizing the budget deficit. Regulatory measures should follow in the second phase . These were free pricing, the privatization of state-owned companies , active anti-monopoly policies, simplification of the tax and financial system, changed budget law and reforms in the banking sector.

A stabilization package was then drawn up with the help of the International Monetary Fund and the World Bank , which consisted of five parts. On the one hand, the government budget of 1989, which was in deficit of 7%, was to be reduced to 1%. On the other hand, price liberalization should reduce the amount of money in circulation and the inflation rate by eliminating state price regulations . Furthermore, one wanted in the income policy to let the wages and salaries rise more slowly than the consumer goods prices. The fourth part was monetary and credit policy , in which the high rate of inflation was to be brought under control by skillfully set interest rates . The last point is the exchange rate policy, in which a uniform and constant exchange rate of 9500 zloty to one dollar was set.

Social and political problems as consequences of the economic transformation

In most transition countries, the beginning of the transformation phase was accompanied by a sharp rise in unemployment and, as a consequence of inflation, the devaluation of savings and significant losses in real income. Some, but not all, of these can be traced back to existing undesirable developments in the central administration economy.

In the further course of the transformation process, the income differences between “winners” and “losers” of the transformation increased sharply. The feeling of not benefiting from the reform efforts even over a longer period of time led to resistance to the market economy reforms among parts of the population. This was reflected partly in the election victories of post-communist parties and partly in the successes of right-wing populist politicians.

literature

  • Benz, Benjamin / Boeckh, Jürgen / Huster, Ernst-Ulrich (2000): Social area Europe. Economic and political transformation in East and West, Opladen: Leske + Budrich (= Analyzes. Politics - Society - Economy, Vol. 72).
  • Habuda, J. (1996): The Transformation Process in East Central Europe. Strengthening the micro level, Munich: World Forum (= Ifo studies on Eastern European and transformation research, Vol. 22).
  • Randzio-Plath, Christa / Friedmann, Bernhard (1994): Enterprise Eastern Europe - a challenge for the European community. On the necessity of an EC Ostpolitik , Baden-Baden: Nomos.
  • Welfens, Paul JJ (1995): Fundamentals of Economic Policy , Heidelberg: Springer.
  • Welfens, Paul JJ (1995): The European Union and the Central and Eastern European Countries. Developments, problems, political options , Cologne: BIOst.
  • Rösler, Jörg (1995): Economic Transformation Processes in the Ex-GDR and its Eastern Neighboring Countries in Comparison (= Pankower Lectures No. 3). Berlin: Helle Panke.
  • Machetzki, Rüdiger (Ed.) (1989): Socialist and planned economy systems in Asia in transition . China - Southeast Asia currently: Volume 9. Berlin: VISTAS Verlag.

See also

Web links

Individual evidence

  1. ^ Markus Pohlmann : Economic elites in East Germany . In: Hans-Joachim Veen (Ed.): Old elites in young democracies? Change, change and continuity in Central and Eastern Europe . Böhlau, Cologne 2004, ISBN 978-3-531-15393-3 , pp. 93 .
  2. ^ Markus Pohlmann: Economic elites in East Germany . In: Hans-Joachim Veen (Ed.): Old elites in young democracies? Change, change and continuity in Central and Eastern Europe . Böhlau, Cologne 2004, ISBN 978-3-531-15393-3 , pp. 94 f., 98 .
  3. ^ Markus Pohlmann: Economic elites in East Germany . In: Hans-Joachim Veen (Ed.): Old elites in young democracies? Change, change and continuity in Central and Eastern Europe . Böhlau, Cologne 2004, ISBN 978-3-531-15393-3 , pp. 98 f .