Inefficiencies in agriculture in Eastern and Central Europe and the Soviet Union contributed to the financial collapse of the socialist system. Yet during the transition, agricultural production has declined. Low profits, high real interest rates, slow progress in reforms in some countries, and uncertainty have restricted producers' ability to respond to reforms. When China's collectivized agriculture was dismantled after 1978, producers' incentives improved and the economy remained stable, fueling a large supply response. In several Central European countries where reforms are well advanced, agricultural growth has resumed. The difficulties of ten years of rural transition offer lessons about the high costs of embedded distortions and inflexibility in institutional evolution.
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ReDIF This chapter was published in: B. L. Gardner & G. C. Rausser (ed.) Handbook of Agricultural Economics, , chapter 30, pages 1547-1592, 2002.
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This chapter was published in the following book, which is listed on IDEAS: B. L. Gardner & G. C. Rausser (ed.), 2002.
"Handbook of Agricultural Economics,"
Handbook of Agricultural Economics,
Elsevier,
edition 1, volume 2, number 3, September.
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