ABSTRACT
It is ironic that the reverse problem of converting socialist economies into capitalist ones has received scant attention. The writings of Friedrich Hayek, Joseph Schumpeter, Milton Friedman, and P. T. Bauer are partial exceptions, but their focus has usually been elsewhere: namely, exposing the errors made by the advocates of socialism, rather than charting the transformation to market economies. Hence, there is no general theory to draw on in addressing the crucial economic policy problem of the 1990s: how to transform command economies into market economies. Recognition of the failures of command economies, and the need to transform them, is the reason why the rhetoric of "markets" and "marketizing" is definitely "in" in the 1990s. In sum, the process of transforming command, non-market economies to market economies is both better understood and more tractable than might be inferred from much of the public debate. Transformation is a systems process encompassing all of the interactive and mutually supporting elements described above.
