ABSTRACT
This chapter highlights the importance of administrative reform as part of Mongolia's transition to a market economy and argues that the twin processes of reform must mutually reinforce one another. It presents a brief overview of Mongolia's experience of transition and the choices that policy makers faced. The chapter discusses some pertinent theoretical issues relating to the distinction between what economists take as parameters and variables. It outlines recent developments in the Mongolian economy focusing on macroeconomic performance, public finance, banking and monetary developments and the external sector. The chapter also discusses how economists have come to a realisation of the importance of institutions which arguably has implications for administrative reform. It provides a critical evaluation of attempts by the Mongolian government to adopt the New Zealand model of administrative reform. The chapter provides our conclusion and raises some questions about the viability of the chosen strategies of reform pursued by successive Mongolian governments.
