ABSTRACT
In December 1991 the Soviet Union disintegrated and its largest constituent republic, Russia, emerged as an independent state. The political leadership of newly independent Russia embarked on an effort to replace its state socialist system, based on state ownership of enterprises and central planning, with a capitalist market system, based on private property and a market system of coordination. The economic strategy that Russia has relied on to implement this transition goes by several names, the most descriptive of which is the neoliberal transition strategy (hereafter NLTS). This strategy, designed by Western neoclassical economists, calls for limited government involvement in the transition process, relying primarily on individual self-interested initiatives to transform the economy. The other countries that emerged from the former Soviet Union, and the former Soviet Bloc countries in Central and Eastern Europe, have also been following the NLTS.
