Some Lessons from Economic Transformation in East Germany
AbstractThe paper compares the experience with shock therapies in East Germany, Poland and the CSFR. After an analysis of the individual starting conditions and economic performance since the inception of comprehensive reform programmes it focuses on the specific elements of the East German reform strategy. It shows that the short-term impact of huge transfers from West to East Germany was not necessarily positive for East German firms. It identifies the lack of incomes policies as a major flaw in the East German transformation concept. On the positive side the rapid restructuring of the East German financial sector allowed it to overcome the inefficiencies that characterize the banking systems nd enterprise finance in Poland and the CSFR. In addition, with the Treuhand it was possible to establish a functioning principal-agent relation between the government as the owner of state-owned firms and the management of these firms, which is completely absent in Poland and the CSFR. That explains why these two countries were not able to benefit much more from their enormous wage advantage over the former GDR.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 686.
Date of creation: Jun 1992
Date of revision:
Contact details of provider:
Postal: Centre for Economic Policy Research, 77 Bastwick Street, London EC1V 3PZ
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820
Find related papers by JEL classification:
- O52 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Europe
- O57 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
- P21 - Economic Systems - - Socialist Systems and Transition Economies - - - Planning, Coordination, and Reform
- P52 - Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Karp, Larry & Paul, Thierry, 1994.
"Labor Adjustment and Gradual Reform:Is Commitment Important?,"
Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series
qt7gc7t3nm, Department of Agricultural & Resource Economics, UC Berkeley.
- Karp, Larry S. & Paul, Thierry, 1994. "Labor Adjustment And Gradual Reform: Is Commitment Important?," Working Papers 51222, International Agricultural Trade Research Consortium.
- Karp, Larry & Paul, Thierry, 1995. "Labour Adjustment and Gradual Reform: Is Commitment Important?," CEPR Discussion Papers 1094, C.E.P.R. Discussion Papers.
- Karp, Larry & Paul, Thierry, 1998. "Labor adjustment and gradual reform: when is commitment important?," Journal of International Economics, Elsevier, vol. 46(2), pages 333-362, December.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.