Twenty Years After The Economic Restructuring Of Eastern Europe: An Economic Review

Abstract

Twenty years ago, the world witnessed the beginning of one of the most dramatic changes in economic systems. It was the 1989 revolutionary changes in Poland that initiated the collapse of the Soviet-style command economic system of Eastern Europe and the Soviet Union. The economic system transformation that followed did not have any precedent or established theories to rely upon. Thus, some countries opted for a “shock therapy” approach while most opted for the “gradual therapy” approach to economic restructuring. This paper reviews the impact of such unprecedented economic transformation and attempts to shed some light on the relative success of such changes and policies -- twenty years after the collapse of the communist regime in Poland that initiated the ‘domino effect’ of the Eastern European command economies collapse.