Currency Boards for Eastern Europe

As long as Eastern Europe and the USSR have unsound currencies, they will be unable to transform themselves into market economies. A sound, convertible currency allows people to carry out decentralized planning, which is more efficient than central planning. In nations with so-called internally convertible currencies, all that is usually required to buy goods domestically is to have currency to pay a domestic seller. Internal convertibility implies that it is not necessary to obtain authorization from any central planner to buy or sell goods that are available inside the country. The exchange of goods is much more extensive, rapid, and efficient where internal convertibility exists, as in the United States, Germany, and Poland, than where it does not, as in Albania and the USSR