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Since 1989, eastern European countries had dramatic change. Suddenly the trade system had fallen apart for ex-Soviet Union no longer wanted to keep theleading role in communist world. The planned economy also influenced by the bad economic conditions. Most of the eastern European countries changed their poli-tical and economic institutions in order to overcome the problem which they were facing. Poland and Hungary reformed their economic system and anticipated to join European Union, which could bring them economic growth. Poland took a pro-gressive way, shock therapy, to reform, but Hungary took a gradual method.The differences came from their different historical background of reform and most important reason was the leaders' power and decisions. Both countriesprivatization, the very important part of marketization was delay for the institution reason. According to the new insnew institutionalist studies, institutions could not be changed quickly, it needs tume and has the path dependence character. From this point of view, it is not hard to realize whythe privatizations or institutions change could not be designed by limited rationality. Poland and Hungary's privatization after 1989 was a good example.-1 -aPost-communist social and economic transition-Poland and Hungary,1989-1995
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