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Foreign Trade in Eastern Europe's Transition: Early Results

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Author Info
Dani Rodrik

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Abstract

By the end of 1991, Czechoslovakia, Hungary and Poland have achieved a substantial degree of openness to foreign trade. In all three countries, trade is now de-monopolized and licensing and quotas playa very small role. Exchange controls have virtually disappeared for current-account transactions. Judging by partner statistics, export performance has been impressive in all three countries, and import booms are under way in at least Hungary and Poland as well. However, there is no evidence that exporters have had any success in finding Western markets for the exports they have lost in Eastern markets. The collapse of the CMEA represents a significant shock, amounting to a loss of real income of 3 1/2 percent of GDP in Poland and 7-8 percent of GDP in Hungary and Czechoslovakia. Export performance is attributable to exchange-rate policy in part, but the collapse of domestic demand has possibly played an even more important role. Finally, trade liberalization so far appears to have had little effect on price discipline, in large part because of the substantial devaluations that have accompanied it

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 4064.

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Date of creation: May 1992
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Handle: RePEc:nbr:nberwo:4064

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  1. Jože P. Damijan & Igor Masten, 2002. "Time Dependent Efficiency of Free Trade Agreements - The Case of Slovenia and the CEFTA Agreement," The Economic and Social Review, Economic and Social Studies, vol. 33(1), pages 147-160. [Downloadable!]
    Other versions:
  2. Dani Rodrik, 1993. "Trade Liberalization in Disinflation," NBER Working Papers 4419, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  3. Ahmad, Jaleel & Yang, Jing, 1998. "Trade Liberalization in Eastern European Countries and the Prospects of their Integration into the World Trading System," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  4. Patrick Paul Walsh & Ciara Whelan, 2000. "Firm Performance and the Political Economy of Corporate Governance: Survey Evidence for Bulgaria, Hungary, Slovakia and Slovenia," William Davidson Institute Working Papers Series 338, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
    Other versions:
  5. Kaminski, Bartlomiej & DEC, 1993. "How the market transition affected export performance in the Central European economies," Policy Research Working Paper Series 1179, The World Bank. [Downloadable!]
  6. Alexandre Rekine & Patrick Paul Walsh, 1998. "European Trade and Foreign Direct Investment. U-Shaping Industrial Output in Central and Eastern Europe: Theory and Evidence," LICOS Discussion Papers 7398, LICOS - Centre for Institutions and Economic Performance, K.U.Leuven. [Downloadable!]
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  7. Nathan Sheets & Simona Boata, 1996. "Eastern European export performance during transition," International Finance Discussion Papers 562, Board of Governors of the Federal Reserve System (U.S.). [Downloadable!]
  8. Basu, Swati & Estrin, Saul & Svejnar, Jan, 2004. "Employment Determination in Enterprises under Communism and in Transition: Evidence from Central Europe," IZA Discussion Papers 1370, Institute for the Study of Labor (IZA). [Downloadable!]
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  9. Michael Funke & Ralf Ruhwedel, 2004. "Trade, product variety and welfare: A quantitative assessment for the transition economies in Central and Eastern Europe," Macroeconomics 0401016, EconWPA. [Downloadable!]
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  10. Paul Hare & Alan Bevan & Jon Stern & Saul Estrin, 2000. "Supply Responses in the Economies of the Former Soviet Union," CERT Discussion Papers 0009, Centre for Economic Reform and Transformation, Heriot Watt University. [Downloadable!]
  11. Swati Basu & Saul Estrin & Jan Svejnar, 2000. "Employment and Wages in Enterprises Under Communism and in Transition: Evidence From Central Europe and Russia," William Davidson Institute Working Papers Series 440, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
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  12. Kazimierz Stanczak, 1992. "A Devaluation With Labor-Intensive Trading and Inelastic Labor Supply," UCLA Economics Working Papers 683, UCLA Department of Economics. [Downloadable!]
  13. Patricia S. Pollard, 1994. "Trade between the United States and Eastern Europe," Review, Federal Reserve Bank of St. Louis, issue Jul, pages 25-46. [Downloadable!]
  14. Dani Rodrik, 1992. "Making Sense of the Soviet Trade Shock in Eastern Europe: A Framework and Some Estimates," NBER Working Papers 4112, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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