Question

Economic reform in Eastern Europe prior to the transition era was modest in scope and largely failed to improve economic performance. Assess this viewpoint.

Answer 1

Economic reforms in Eastern European countries have been cautious in approach, because these countries have largely been under the influence of communism or socialism driven economic system. It made these nations to adopt policies that can bring reforms in a way that it does not bring knee-jerk reaction in the economy and making the economy to collapse, creating more pain to people that people already getting without reforms. It is the reason that reforms have been modest in scope. Further, these countries could not get the adequate support in terms of financial assistance, policy planning and expert support in opening up and liberalization of the economy as other nations get when their economy get collapsed. It led to economic performance that was below the expectations. It was largely due to the lack of support by EU nations and other developed countries, as they were more of the spectators, rather proactively helping these east European countries. It is the reason that these nations could not implement successful economic reforms in their economies.