Aspects of Transition

The six studies, selected from those contributed to the research project entitled The Integration of the New Market Economies of Europe and Asia into the World Economy: the Changing Internal and External Factors and Global Implications, open with Miluily Simai's introductory survey. After identifying the enterprise and listing its participants, he discusses the themes of the project, emphasizes the lessons to be drawn from Chinese experience, and interweaves his analysis with a description of eastern European, and particularly, Hungarian, reactions to the process of transition and its social cost. The next three studies are devoted to the international organizations and their response to the transition. Norman Scott discusses and assesses UN assistance. He focuses on the United Nations' Economic Commission for Europe and describes its attempt, and failure, to be entrusted with the administration of a new Marshall Plan designed for eastern Europe and resting, in contrast to the original, on the technical assistance needed to establish a market economy, rather than on grant aid. Reimut Jochimsen considers the role of the IMF, presents its action in support of the transition economies in detail, and concludes that macroeconomic assistance and adherence to the Washington consensus are insufficient. He recommends that greater emphasis be put on the microeconomic foundations of the market economy and on the creation of market institutions. Peter Naray considers the transition economies in the Uruguay Round and the WTO. He discusses the expected benefits of the Round for the central and eastern European countries, seeks to explain, and draws attention to, the few provisions introduced in the WTO agreements in favour of the transition economies, and convincingly pleads for special transition solutions to promote the accession of the majority of transition economies still waiting to become members of the organization. The final two studies, written by Max Engman and by Harriet Matejka, depict the stark contrast between Europe as it emerged after the First World War and the collapse of two empires, and Europe as it revives following the end of the Cold War, the division imposed upon it at Yalta, and the fall of the Soviet empire. Although the creation of new states, with its train of territorial, monetary and institutional change, are common to both periods, division and the segmentation of markets was the mark of the first. What singles out the second, instead, is transcontinental integration, together with the transition from plan to market in the East. Max Engman discusses the period following the First World War and compares it with the post 1989 years. Harriet Matejka considers the impact of transition on the trade, investment and integration of the European continent.