TRANSITION TO A MARKET strongECONOMYstrong - Cato Institute.pdfVIP

TRANsITIoN TO A MARKET ECONOMY Anatoly A. Sobchak The Soviet Union is facing a choice ofwhich path to follow to promote economic development. Today, virtually everyone—the economists who for decades have insisted on the need for transition to a market economy, the politicians who as recently as six months ago denied the necessity and the possibility of such a transition, and the over- whelming majority of the population—seems to have arrived at the same conclusion: The transition to a market economy is inevitable, as night follows day, and is the only way to economic revitalization for this country. We have no current alternative. The strongest argu- ment to support this conclusion is the road traveled by a number of countries in the post—World War II period: the road from dictator- ship, from totalitarian states and totalitarian economies, to the market. Unique as this road may have been for each country—Spain, China, South Korea—the end result has been the same: rapid economic development and economic prosperity. That is to say, each country reached the goal toward which our country is now striving. Conditions for a Successful Transition There is, however, far less unanimity concerning the problem of how to make the transition to a market economy. Yet this transition question—the problem of defining the mechanism; the ways; and the forms of going from total state monopoly of ownership, produc- tion, and all economic activity to a market economy—is the most fundamental question of all. How this question is solved will deter- mine whether we succeed or fail in accomplishing the transition, whether this transition will be possible, and in what ways it will be made. Cato Journal, Vol. 11, No. 2 (Fall 1991). Copyright © Cato Institute. All rights reserved, The author is Ma