ABSTRACT
China’s economic reformer, Deng Xiaoping, is noted for his claim that ‘It doesn’t matter whether the cat is black or white, as long as it catches mice.’ The traditional Soviet system was, in many ways, not a planned system at all. The difficulty of transition means that countries tend to postpone reform until the pre-reform conditions get nearly intolerable, to the point where those who are clearly better off with the status quo become small in number and influence. The road of Russian reform is therefore difficult to traverse, and there will be frequent retreats. In the end, it is likely that Russia will arrive at the destination of a normal market economy, if only because other endpoints are either unstable, or, like the previous system, clearly undesirable. Russian streets are alive with private market activity, private farms are blossoming, many state-owned enterprises have been ‘privatized’.
