OUTPUT DECLINE AND RECOVERY IN THE TRANSITION ECONOMIES - CAUSES AND SOCIAL-CONSEQUENCES

This paper suggests that output in the transition economies of eastern Europe and the countries of the former Soviet Union is related to, fi rstly, macroeconomic stabilization, and secondly, the speed of transit ion. The statistical analysis suggests that those countries which have been most successful in reducing inflation have experienced a lower l evel of output decline and have been first to achieve recovery in real output. There is also strong evidence that the economies which have b een boldest in adopting reforms have been most successful in limiting the fall in output and promoting growth. No support is found for the a ssertion that the faster the speed of transition the greater the adver se impact on basic social indicators, such as mortality rates.