ABSTRACT
Analysis of fiscal policy and its sustainability in the former socialist economies poses no simple task. Even more complex is the question of policy innovation adapted to the changing economic environment. There are several objective reasons for this. The obvious one is the lack of reliable data that would allow granular decomposition of government finances. Another problem comes through recognizing the fact that the FSU economies have been going through periods of turbulent transformations that preclude standard data aggregation that fits popular robust regression models. This is due not to malicious intent but due to rudimental conditions of national accounting in those countries. Lest one forgets the issue at hand: a social and economic transformation of the post-socialist planned economies into dialectically new social formations. Until recently, the twelve economies in question were part of a bigger centralized economy without effective regionally independent policy mechanism. Therefore, any analysis can only be structured around the period of nominal political and economic independence of the early 1990s until mid 2008, before the latest global crisis made a landfall in the CIS.
