Economic transition in Hungary and East Germany: gradualism, shock therapy and catch-up development.

What factors determine the success of economic transition, development and growth?

Examining the contrast between East German shock-therapy and Hungary's gradualism, the book generates a set of generalisable conditions for economic development which imply some degree of state intervention and strategy.

A stability-oriented incomes policy and a carefully managed integration strategy can enable sustainable export surpluses, a competitive currency and macroeconomic stability, whilst providing sufficient room for economic restructuring, structural transformation and technological catch-up.

The dangers of premature integration are examined.