Current State of Economic Reforms in Eastern Europe

The virtually bloodless revolutions of 1989 in Eastern Europe have understandably given rise to a rich complex spectrum of controversy and debate among reformers and specialists in both East and West on the problems and prospects surrounding the ability of these economies to make a successful transition from the distorted legacy of state/socialism to an economy that is steered in the main by the market mechanism. A cursory survey of the literature on the subject reveals two related yet distinct approaches. The first consists in the view - popular among the reformers in Central Europe and the CIS as well as those in the West - than an immediate transition to a market economy is an indispensible requirement for the eventual success of the projected transformation. This transition must not be gradual or evolutionary, but must simultaneously be carried out here and now (Leontief, 1990). While the other view - hardly fashionable on either side - consists in emphasizing the precarious and unique nature of the enterprise and insists that there are clearly defined limits to what markets can or cannot accomplish (Aage, 1992) . An uncritical hasty adoption of policies geared towards drastic systemic change must first of all reckon with the historical specificities of the conjuncture in which the East European countries find themselves in before designing strategies to accomplish the transition