ABSTRACT
This chapter provides a set of primary and secondary elements of the shock therapy model of transition. The primary elements include the Post Keynesianism is based on the writings of John Maynard Keynes, particularly The General Theory of Employment, Interest and Money, which has imperishable relevance to current economic and social problems. The implementation of the shock therapy approach, which effectively ignored the political structure, did not allow optimism about the development of the civil political institutions, Post Keynesians argued. The implementation of the neoclassical transition model resulted in a cultural and ideological vacuum. The secondary elements include the large-scale privatization was not essential to overcome shortages as the neoclassical transition models stipulated. Post Keynesians have been criticized by institutionalists on the grounds that their study of institutions is unsubstantial. A civilized society, in the mould proposed by the Post Keynesians, required a social policy that addressed chronic unemployment.
