socialist transistions

Question 1

what occured in the turbulent 1980s?

Answer 1

rise of solidarity in Poland.
there was a slowdown in economic growth in the USSR and eastern europe.
Reagan ups the arms race and imposes unsustainable burden on soviet budget
USSR became involved in the afghanistan war
growing popular discomfort in eastern europe and USSR

Question 2

what occured between 1989 and 1991?

Answer 2

the communist rule ended in everywhere apart from china, vietnam, Laos, cuba and north korea

Question 3

what were the 4 strategies facing Gorbachev?

Answer 3

1) go back to rigid of ‘classical socialism’ staliinist system and surpress the republics
2) adopt a more flexible moderate model: limited expansion of private sector
3) move towards market socialism
4) abandon socialist system and begin transistion to capitalism

Question 4

what were gorbachev’s policies and their effec?

Answer 4

Maintained subsidies and public spending
Anti-alcohol campaign reduced tax revenues
Falling oil prices reduced government revenues
Result - exploding budget deficit
Increasing foreign debt and resort to monetising of deficit
Result - repressed inflation and shortages

Question 5

how does inertia relate to the collapse of the soviet union?

Answer 5

leadership could not believe system was doomed. Soviet citizens had false expectations due to years of being fed false information about strength of USSR economy - hence unpopularity of Gorbachev in Russia today!

Question 6

how does incompetence relate to the collapse of the soviet union?

Answer 6

Incompetence of Soviet elites -
poor understanding of economics - importance of markets, macro stability, obsession with industrialisation etc.

Question 7

how does ideology relate to the collapse of the soviet union?

Answer 7

Ideology - not prepared to give up on the great project of “Socialism”

Question 8

what is market socialism?

Answer 8

market socialism is a situation which occurs when there is political freedom however not economic freedom

Question 9

why is market socialism a contradiction?

Answer 9

Market socialism is a contradiction because it maintains a predominance of public ownership of resources - “naïve reforms” - a “sham” market economy (Kornai, 2006)
they are in need of an ownership reform

Question 10

what are the factors that determine the sucess of a countries transition?

Answer 10

1. Extent of political reforms/ ongoing political freedoms
2. Integration in global markets
3. Economic structure/ natural resource abundance
4. Speed of transition to market economies

Question 11

what does the long term growth in russia depend on?

Answer 11

the consequences of the invasion
democratic reform
lowering of inequality
expansion of security of property rights and individual liberties
economic restructuring away from primary goods exports
reductions in corruption