This paper investigates the relationship between economic reforms and constitutional transition, which has been neglected by many transition economists. It is argued that assessment of reform performance might be very misleading if it is not recognized that economic reforms are just a small part of large scale of constitutional transition. Rivalry and competition between states and between political forces within each country are the driving forces for constitutional transition. We use Russia as an example of economic reforms associated with constitutional transition and China as an example of economic reforms in the absence of constitutional transition to examine features and problems in the two patterns of transition. It is concluded that under political monopoly of the ruling party, economic transition will be hijacked by state opportunism. Dual track approach to economic transition may generate very high long-term cost of constitutional transition that might well outweigh its short-term benefit of buying out the vested interests.
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Paper provided by Center for International Development at Harvard University in its series CID Working Papers with number
43.
Find related papers by JEL classification: K1 - Law and Economics - - Basic Areas of Law H1 - Public Economics - - Structure and Scope of Government B14 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Socialist; Marxist M40 - Business Administration and Business Economics; Marketing; Accounting - - Accounting - - - General O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General P20 - Economic Systems - - Socialist Systems and Transition Economies - - - General
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