ABSTRACT
Mikhail Gorbachev's agenda of economic reforms is ambitious; it allows economic arrangements which in the past would have been well outside the ideological boundaries of socialist practice. Gorbachev's official sanction of long-term lease contracts in agriculture also kindles the hope in the rural sector that families will be allowed to set up family farms as the basis for rebuilding an unproductive agricultural sector. Law has been at the heart of perestroika. It is the new body of reform legislation that defines the structure of a reformed Soviet economic system. The chapter discusses both Soviet ability to benefit from interdependence and Western interest in contributing to Soviet modernization are contingent on the domestic economic reforms. The strongest potential source of institutional change is likely to be involvement in the international market. For that reason, measures legalizing joint ventures with foreign companies and a further opening of the Soviet economy to international trade are vital developments.
