Highway and Byways: Studies on Reform and Postcommunist Transition by Janos Kornai
For the first time, Hungarian economist Janus Cornai used a metaphor for social transformation in his earlier book, The Road to a Free Economy. The new metaphor that defines the…
Highway and Byways synopsis
For the first time, Hungarian economist Janus Cornai used a metaphor for social transformation in his earlier book, The Road to a Free Economy. The new metaphor that defines the framework of this set of recent studies reflects a broader perspective and a broader understanding of the complexities of the transitional period: every highway eventually leads to capitalism, as Corney observes, but to what kind, quickly, and at what cost? Who wins and who loses? Kurnay draws from his experiences in Hungarian reform as well as from the former Soviet Union to set several key points.
The first three studies describe the error in countries that have tried to mix elements of planned economies and the market. The efforts made by the communist states to introduce market socialism (the "middle way") included an inherent contradiction between the logic of socialism and the logic of the system of free enterprise and was doomed to fail.
In the following studies, Corney analyzes the dilemmas. The process of transition from communism to free enterprise is filled with daunting obstacles.
It requires less than redefinition of ownership, changing the values of wealth distribution, transferring control of political power, establishing financial institutions and imposing fiscal discipline, and offering deep economic sacrifices. Kornay concludes with a comprehensive survey of social transition, describing the stages in which states go through, which will be particularly useful for scientists of comparative economic systems..
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