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The State and the Transitions in Eastern Europe


  • Bob Donnorummo

    (University of Pittsburgh)


This paper is meant to serve as a starting point for a discussion on the transformations taking place in eastern Europe since 1989. Its admittedly liberal bias will be evident in its discussion of the role of the state in these economic transitions. It will conclude with a brief discussion of how the post-1989 transition period differs from other years of great change in twentieth century eastern Europe, and what this transition process tell us about the type of capitalism unfolding in eastern Europe. Four general positions serve the guiding philosophy of this essay. a) In economic terms, the transformation from state owned command to privately owned market economies should be cautiously judged a relative success. b) Those countries which swallowed their bad tasting medicine early and in large doses have been more successful than those which have attempted to implement a softer, more gradual approach. c) In those countries where the state’s direct involvement in the economy has been limited, there is, on the whole, stronger and more potentially enduring economic development. d) Those countries which have avoided collective violence have been much more successful than those who have experienced internal or external conflict.

Suggested Citation

  • Bob Donnorummo, 1998. "The State and the Transitions in Eastern Europe," Zagreb International Review of Economics and Business, Faculty of Economics and Business, University of Zagreb, vol. 1(2), pages 47-63, November.
  • Handle: RePEc:zag:zirebs:v:1:y:1998:i:2:p:47-63

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    More about this item


    privatisation; transition; sorporate governance; Marshall plan;

    JEL classification:

    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • P52 - Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies


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