Scandinavian Working Papers in Economics
Working Paper Series,
Research Institute of Industrial Economics
No 1499: The Growth Consequences of Socialism
Andreas Bergh (), Christian Bjørnskov () and Luděk Kouba ()
Additional contact information
Andreas Bergh: Department of Economics, Lund University, and, Postal: Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden
Christian Bjørnskov: Department of Economics and Business, Aarhus University, and, Postal: Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden
Luděk Kouba: Department of Economics,, Postal: Faculty of Business and Economics, Mendel University in Brno, Zemědělská 1, 613 00 Brno, Czech Republic
Abstract: The discussion of the growth consequences of socialism has fulminated for a century, sparked off by the Calculation Debate in the 1920s and 30s, and has concerned the performance of the Soviet Union in the 1950s and the mixed development in the 1990s after communism collapsed in Central and Eastern Europe. We aim to inform these debates by providing an empirical assessment of how socialist economies performed across the second half of the 20th century. Using both neighbour comparisons as well as more formal empirical analysis of developing countries that turned socialist after independence, we derive a set of estimates of the degree to which the introduction of a planned socialist economy affects long-run growth and development. All analyses point towards an annual growth decline of approximately two percentage points during the first decade after implementing socialism.
Keywords: Economic growth; Socialism
Language: English
35 pages, August 27, 2024
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