Transition
from Socialism to Capitalism
1. Modelling the transition from a socialist to
capitalist economic system ( Paper.pdf)
Abstract
The
transition of several East and Central European countries and the countries of
the Former Soviet Union from the socialist economic system to the capitalist one
is studied. A recently developed microeconomic model for the personal income
distribution and its evolution and a simple functional relationship between the
rate of the per capita GDP growth and the attained level of the per capita GDP
are used to describe the transition process. The developed transition model
contains only three defining parameters and describes the process of real GDP
per capita evolution during the last 15 years. It is found that the transition
process finished in the Central European countries several years ago and their
economic evolution is defined by pure capitalist rules. In the long run, this
means that the future of these countries has to follow the same path, i.e.
dependence on the per capita GDP growth rate of the per capita GDP itself, as
the developed countries have had in the past. If the best GDP evolution
scenario occurs for the studied countries, they will be able to maintain the
absolute lag in per capita GDP relative to most developed countries including
the