Studying social reform

Empirical research is being carried out by the International Institute for Applied Systems Analysis and a network of collaborators in eight countries in central Europe on impediments to growth in the smaller transition economies. The work focuses on five areas: impediment to exports; impediments to foreign direct investment; impediments to access to international capital; import competition; and the possible role of regional trading or financial arrangements.

A purely economic view of transition is too narrow. Experience shows that interdependence between the economic, social and political spheres is at the heart of the transformation of the system and determines its legitimacy as well as its sustainability. There is also the diversity of transformation trajectories to consider, such as the social and Euro-centred trajectory followed in Central Europe, the depression-cum-State-crisis experienced in Russia and the gradualist and high-growth path followed, for instance, by China. Thus there is not one way for transformation.