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Pension systems and, as ratios of GDP, pension expenditures show large variation among countries. This variation reflects, above all, demographic factors and differences in the level of insurance protection, the latter tending to increase with the level of development. The focus of this paper is pension developments and reforms in the FOUR transition countries: the Czech Republic, Hungary, Poland and Romania, during the 1990s. In terms of key pension statistics, Poland and Romania are clear outliers not just among the FOUR, but also in Europe. The greater pension expenditures in Hungary and, especially, Poland are in part inherited from the socialist system and in part caused by the more radical restructuring reforms which have been adopted since the collapse of that system in 1988-1990. These greater expenditures have prompted these two countries to start replacing gradually their PAYG-DB system with a three-pillar mixed system, in which private pension funds are intended to become a large, eventually the dominant, component. This chapter gives an account of the main aims and principles of the reform measures which came into force in Hungary in 1998 and in Poland in 1999. Also reported are estimates of the public debt implicit in the obligation of the pre-reform state pension system to pay benefits to current pensioners and to current workers. These estimates are found to be, for Hungary, Poland and the Czech Republic, significantly higher than in main European Union countries.

The paper discusses the reasons for the observed variation in the sequencing, speed and content of reform policies, in the 1990s, among 25 post-socialist countries of Central Europe and the Former Soviet Union. It argues that these differences, while considerable in the early 1990s, did not amount to as substantially different reform strategies as it was often claimed and, in any case, have for most countries narrowed down considerably in the second half of the 1990s. The transformational recession is interpreted to have been of the stagflation type, related largely to initial, pre-reform crisis conditions. The paper reviews macroeconomic policies and evaluates the progress which the 25 countries have made in terms of a set of criteria proposed for the purpose of such an evaluation, and it discusses the reasons which distinguish the more successful from the less successful. The potential contribution to growth of the technological convergence (catching-up) factor during the first half of the 21st century is also estimated for key transition economies.

This paper discusses the key hypotheses which Joseph Stiglitz proposed, in his wide-ranging critique of the ''Washington Consensus'', with regard to transition reforms and economic polices in China and Russia. The primary purpose is to evaluate the Stiglitz perspective in the light of empirical evidence, including the experience of countries outside China and Russia. Although some of the points Stiglitz makes are important for understanding what has happened in the transition, this paper argues that his perspective mis-interprets the key facts of the Chinese transition, mis-describes the facts of the Russian transition and fails to consider the theoretical and policy implications of the success of a ''third model'', which is represented by some Central European and Baltic transitions.

This paper considers the impact on sectoral outputs and employments of rapid and large changes in relative prices, such as those which occurred in transition economies during the 1990s. A simple general equilibrium model is developed in which price changes are induced by a tax reform and resource mobility is restricted. The reform is designed to improve the quality of the price system, but is shown to cause a recession the size of which is proportional to the initial tax distortion. It is also demonstrated that a wage flexibility would moderate the magnitude of the recession, but this gain would be obtained at a cost in longer term efficiency, and would be, in any case, unsustainable.

This paper contains the text of a guest lecture delivered by Dr Gomulka to the Nordic Finance Committee at its meeting in Lillehammer, Norway on 21 January 1994. The paper looks at empirical evidence, both economic and political, from the whole area of Central and Eastern Europe and the Former Soviet Union, particularly Russia and Poland.

The principal novelty of this paper lies in offering explanations of changing priorities and of the stop-go-stop sequence of policies in Poland in the years 1990-1991. The paper suggests that, in the first year of the reform, achieving price stability was secondary to the following three other aims: a substantial increase of the international reserves (large up-front devaluation required), a drastic reduction of the share of dollar currency in the total money supply (large monetary expansion is required) and a major improvement of the quality of the price system (drastic increases of some administrative prices needed). It is shown that the money supply was effectively the only nominal rate and the incomes policy became nominal anchors only in the second year of the reform. The paper also discusses the causes of the budget crisis in 1991 and the relationship between the quality of the macroeconomic control and the pace of structural change.

In this paper we develop a new model of growth accounting and use it to analyse the long-term growth of the US and the USSR. The technique is designed to capture the indirect or "feedback" contributions of technological change and labour input growth. These indirect contributions arise from the fact that in the medium- and long-term, technological progress and labour input growth raise the level of current output and thus, given the investment/output ratio, the growth rate of capital. The technique also avoids the problem of identifying the bias of technological progress faced by the standard shore-run method of growth accounting. In our application to the Jorgenson-Gollop-Fraumeni data for the US economy 1949-1978, the technique shows that over the entire period, technological progress and labour input growth were the two main source of growth, with capital accumulation in third place. The results of our analysis of Soviet economic growth over this period are less clear-cut but still strongly suggestive. In particular, our estimates of the contribution of technological progress to Soviet economic growth typically show it to be considerable, and indeed sometimes overwhelming. These results stand in sharp contrast to the standard view that Soviet economic growth since 1928 has relied primarily on increased amounts of inputs rather than on technological progress.