Journal of Economic Perspectives: Vol. 10 No. 2 (Spring 1996)


Quick Tools:

Print Article Summary
Export Citation
Sign up for Email Alerts Follow us on Twitter


JEP - All Issues

Stabilization and Growth in Transition Economies: The Early Experience

Article Citation

Fischer, Stanley, Ratna Sahay, and Carlos A. Vegh. 1996. "Stabilization and Growth in Transition Economies: The Early Experience." Journal of Economic Perspectives, 10(2): 45-66.

DOI: 10.1257/jep.10.2.45


The authors analyze the growth and stabilization experience in twenty-six transition economies in Eastern Europe, the former Soviet Union, and Mongolia for the period 1989-94. Inflation rates have declined significantly in most countries following an inflation stabilization program. Typically, stabilization has been followed by growth within two years; and growth does not occur without stabilization. Reducing inflation thus appears to be a precondition for growth. An econometric analysis of the short-run determinants of inflation and growth illustrates the key roles of fixed exchange rates, improved fiscal balances, and structural reforms in spurring growth and lowering inflation.

Article Full-Text Access

Full-text Article (Complimentary)


Fischer, Stanley (IMF)
Sahay, Ratna (IMF)
Vegh, Carlos A. (IMF)

JEL Classifications

P20: Socialist Systems and Transitional Economies: General


View Comments on This Article (0) | Login to post a comment

Journal of Economic Perspectives

Quick Tools:

Sign up for Email Alerts

Follow us on Twitter

Subscription Information
(Institutional Administrator Access)


JEP - All Issues

Virtual Field Journals

AEA Member Login:

AEAweb | AEA Journals | Contact Us