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How to Stabilize: Lessons from Post-Communist Countries

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BETWEEN 1989 AND 1991 the collapse of the Soviet bloc brought down the established political system in a number of countries. With the rapid decline of the communist party's power throughout the region, and particularly following the collapse of the Soviet Union, it proved impossible to maintain an economic system based on hierarchical subordination, predominant state ownership, and a command-rationing allocation mechanism. All previously communist-controlled countries therefore inherited both an economic system that no longer functioned properly and a political struggle for power.


Stanley Fischer

Vice Chairman of the Board of Governors of the Federal Reserve System

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