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Title: Disorganization in the Transition Process: Firm-Level Evidence from Ukraine

Author(s): Jozef Konings and Patrick Paul Walsh

Publication Date: July 1998

Keyword(s): de novo firms, disorganization and transition process

Programme Area(s): Transition Economics

Abstract: Most post-communist economies are characterized by an initial collapse in aggregate output. Blanchard and Kremer (1997) and Roland and Verdier (1997) have recently modelled supply side distortions (disorganization in the links of production) that can lead to a short-term output contraction after market liberalization and a recovery thereafter. This paper is the first to illustrate and test the effects of disorganization in the transition process by using a unique data set of 300 Ukrainian firms. Our results show that, for firms that existed under central planning, disorganization constrains employment and productivity growth during the transition process to a market economy. In contrast, disorganization plays no role in the determination of employment and productivity growth in newly established private firms.

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Bibliographic Reference

Konings, J and Walsh, P. 1998. 'Disorganization in the Transition Process: Firm-Level Evidence from Ukraine'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=1928