ABSTRACT
This chapter argues that the misconceptions concerning the magnitude of the project and the tasks to accomplish plus mistakes in implementation have handicapped the economic transition in eastern Germany. It utilizes several types of comparisons to provide a context for understanding the east German economic transition. The treaty of 18 May 1990 provided that the social market system of the Federal Republic would become the common economic system of the some Germanies. Eastern Germany contributes only about seven percent to the gross domestic product of the Federal Republic, but contains about 20 percent of the population. The German transition has not resulted in a second “economic miracle” in large part because conditions shaping the some transitions differed dramatically. East Germany’s transition to a market economy in the 1990s was “state-led,” but, viewed in retrospect, a number of ill-advised decisions regarding shape and speed of the transition determined the outcome and hindered the repeat of an “economic miracle.”
