ABSTRACT
The reunification of Germany resembled a one-way street that led directly, almost as if it were a textbook example, from a centrally planned economy to a market economy. Since similar processes are taking place in other communist-bloc countries, it is often overlooked that the transformation of economic systems can occur in both directions. Market economies and centrally planned economies are extreme cases, constructs using ‘chemically pure principles’ that are best suited to serve didactic purposes. The comparison, which we all know from the field of microeconomics, of the model of perfect competition and that of the pure supply monopoly is analogous in this respect (the assumptions underlying these models, namely perfect information, perfect adjustment speed, the perfect adjustment of labour and capital, etc., demonstrate that they are extreme cases).
