ABSTRACT
The last two decades have seen dramatic economic and social changes sweeping across the transforming command economies of the former communist bloc. In all of these transforming economies, the emergence of a viable private sector has played a central role in the transition from plan to market. Even in the case of China, which has chosen a gradual path to the reforms over the rapid privatization of “shock therapy,” the emergence of a private economy has played a crucial role in the evolution of a competitive marketplace (Naughton 1995).
