DID THE COLLAPSE OF EASTERN-EUROPE AFFECT ECONOMIC-POLICIES IN DEVELOPING-COUNTRIES

This paper examines the effects of the collapse of the communist regim es of Eastern Europe on economic reform in developing countries within a framework earlier developed by Hirschman (1964). It is shown that c ountries relying on help from Eastern Europe, socialist developing cou ntries, have reformed their economies when aid from Eastern Europe cam e to an end. The empirical evidence also suggests that sizeable aid fr om Western countries has negatively affected reform efforts.