The Impact of Initial Conditions

Abstract

Despite the similarities in their economic systems, the economic characteristics of the transition economies at the starting point of the transformation process differed widely because they inherited different degrees of structural and macroeconomic distortions, their integration into the world market was at varying levels and there were also significant differences in income levels. Furthermore, some countries had already introduced some market reform measures, while others had kept intact the rigid rules of central planning up until the end of the communist regime.