Industrial Growth Rates and Instability: An Historical Analysis of the Former Centrally Planned Economies of Eastern Europe
Journal Title: Eurasian Journal of Business and Economics - Year 2011, Vol 4, Issue 8
Abstract
One of the central tenets of socialism and central planning economics, as practiced by the East European countries, was that this organization of employment, production and activity could achieve higher growth rates than market economies. This paper presents an historical analysis of economic performance of seven countries: Bulgaria, Czechoslovakia, GDR, Hungary, Poland, Romania and Yugoslavia during the crucial period of socialism (1960-80). It studies the relationship between industry output growth rates and output instabilities in approximately twenty-five industries. Using empirically estimated models it was found that the instability (volatility) of industry output increased with growth rates and at an increasing rate. Since instability creates substantial costs, these findings imply that the true value of income and product streams in East European countries, after discounting for instability, was lower than otherwise believed. A decomposition of instability into two sources, systemic structure versus operational implementation is suggested.
Authors and Affiliations
Evan E. ANDERSON
Keywords
Related Articles
- EP ID EP441490
- DOI -
- Views 67
- Downloads 0
How Do Foreign Direct Investment and Growth Interact in Turkey?
This paper empirically investigates the relation between growth and Foreign Direct Investment (FDI) in Turkey. There are mixed conclusions about the impact of FDI on growth and the literature includes many studies where...
Successful Employee Empowerment: Major Determinants in the Jordanian Context
Being the most important asset, the human resource represents today the source of the organizations’ sustainable competitive advantage. This focus on the employee as the organizations’ core of human capital management dr...
Decomposition of Technical Change and Productivity Growth in Indian Agriculture Using Non-Parametric Malmquist Index
The present study endeavors to analyze the rate of total factor productivity growth and technical progress of Indian Agriculture between the period 1971 to 2004, using a Data Envelopment Analysis. It has been observed th...
How have Mergers and Acquisitions Affected Financial Performance of Firms in Indian Manufacturing Sector?
The paper examines how mergers and acquisitions (M&As) in India after initiation of reforms in 1991 have affected firms’ financial performance. Using panel data and applying the method of difference GMM, it is found that...
Relationship between Risk-taking, Capital Regulation and Bank Performance: Empirical Evidence from Bangladesh
This paper attempts to analyse the relationships between risk-taking, capital regulation and performance in banking sector of Bangladesh. We use Generalized Methods of Moments (GMM) in an unbalanced panel data using 38 c...