Gur Ofer

Industrial Structure, Urbanization, and the Growth Strategy of Socialist Countries

I. The case for a different industrial structure, 220. — II. Differentials in the industrial structure: 1960, 226. — III. Deviations of the individual socialist countries, 241. — IV. Concluding remarks, 243.

Economizing on Urbanization in Socialist Countries: Historical Necessity or Socialist Strategy

Publisher Summary This chapter discusses economizing on urbanization in socialist countries. The socialist strategy of rapid industrialization, which has now been pursued for at least a generation, has succeeded in increasing the proportion of GNP from manufacturing and related industries to levels that are above the “normal” for market economies at similar stages of development. However, this high level of activity in manufacturing is not fully revealed by the demographic characteristics and by the distribution of the labor force by sector of origin of these East European countries during the 1960s. As urbanization is a dynamic historical process, the economizing on urbanization hypothesis should be tested directly within the historical context of growth and structural changes. Such a test is essential in order to find out whether the deviant structures found in the socialist countries were actually created during the socialist period, and can thus, be explained by the socialist growth strategy, or whether the deviant structures were inherited from the preceding regimes—and must then be explained by completely different factors.

Budget Deficit, Market Disequilibrium and Soviet Economic Reforms

Problems within the present fiscal and monetary system of the USSR are examined (a) as a function of both past systemic shortcomings and of fiscal developments caused by economic reforms enacted to date and (b) as obstacles that must be overcome during the transition to a more market-oriented economy. Major sources of disequilibrium in the present economy are identified through analysis of Soviet budgets from both the reform and pre-reform periods, and a concluding section presents policy options for the period of transition to a more radical economic reform. Journal of Economic Literature, Classification Numbers: 027, 124, 300.

Work and family roles of Soviet women: historical trends and cross-section analysis.

Over the last two generations, women in Soviet Russia reached the highest labor force participation rate in the world. As everywhere else, the process was accompanied by a sharp rise in their educational attainment and a similarly sharp decline in fertility. On the basis of data about families of Soviet emigrants during the early 1970s, it is shown that Soviet women respond to the same economic variables that create similar trends in market economies. Socialist ideology and Soviet growth strategy help on the one hand to expedite the process, but on the other amplify the contradiction between womens family and labor market roles and result in relatively low wages for women.

The Russian city in transition - the first six years in ten Volga capitals

After studying the nature and variety of transition in 10 regional capitals of Russia, the authors observe that: 1) All cities have experienced radical changes in their institutions and economies - changes associated on the one hand with the abolition of central planning and the introduction of freer markets, and on the other hand with political decentralization and the introduction of local elections. 2) These changes have led to a wide diversity in economic and social outcomes, reflecting differences in the central governments (inequitable) economic relations with regions with regional as well as differing local and regional policies. Most northern cities adopted policies more consistent with the central governments support of free market reforms; most southern (Red Belt) cities pursued more cautious, protective policies. 3) City governments are using proactive economic policies, including interventions to save local industries. Such efforts highlight the dual nature of the Russian transition, characterized by a shift in power from central to local government as well s public to private enterprises. 4) A major difficulty facing Russian cities is the cost of subsidies to housing and utilities. Real estate in general constitutes a major expenditure category for local government rather than, as in most western cities, a major source of revenue. A transition in this area alone could revolutionize the finances and independence of Russian cities. 5) The jury is still out in what the right social and industrial policies were during the first years of reform. Ulyanovsk clearly lagged on market reforms, and Saratov represents a model of liberalization without institutional support. Both extremes have failed, but so far the social consequences of the Saratov model appear to be worse than those of the Ulyanovsk model. 6) With the credibility of Russias federal government at an all-time low, foreign investors have no choice but to rely on the competence and reliability of local leaders, especially mayors and governors. They will be looking for evidence of accountability in the form of the rule of law, and transparency in the form of reliable public information. Information at the city level - often unavailable and not easily accessible - would be very useful in attracting local researchers to monitor progress (as a basis for accountability) and diagnose problems (as a basis for public policy debate and political decisions.

Are Transition Economies Normal Developing Countries? The Burden of the Socialist Past

The view that the socialist past of the transition economies (TEs) is irrelevant and that these economies should now be considered as just another group of developing, low or middle income countries, has been gaining many adherents. This overlooks, so we believe, the fact that transition is path dependent and that the process of transition cannot be understood without regard to the socialist heritage. This heritage is relevant in many aspects of the transition process, but it is probably most important in the transformation of the institutional infrastructure from that of the old regime to institutions of a market economy and a democratic society. This paper focuses on the transition of this institutional infrastructure. In it we first summarize, on the basis of previous literature, the stylized characteristics of the two sets of institutions, the dissonance between them and the problems involved in moving from one to the other. This discussion in based to a large extent on Ofer (2001, 2003, 2004) and on references therein. We then estimate the institutional diversion of different groups of TEs from ‘normal’ patterns at comparable levels of development (a la Kuznets). The empirical analysis is based mostly but not exclusively on the database of the Governance and Anti-Corruption project of the World Bank Institute (WBI; Kaufmann et al., 2005). In the analysis that follows we relate the gaps to the specific socialist institutional heritage and underline the differences in the nature of the problems and solutions of building new institutions that stem from this heritage.

Transition in Regional Capitals along the Volga

A group of researchers led by two prominent Western economists examines the experience of 10 regional capitals along the Volga River following the disintegration of the USSR, during a period of significant transition in the municipal (government) and economic functions exercised by Russian cities. The authors survey general similarities in these cities? fiscal functions, privatization, and economic development, as well as place-specific differ-ences (e.g., unique resources, strong/weak government) contributing to divergence of eco-nomic conditions among them during the post-Soviet period. The study combines official data on economic performance, employment, and municipal budgets with fieldwork-based case studies, interviews, and survey research.

Trials of transition : economic reform in the former communist bloc

Since the centralist regimes of Communist Europe collapsed, their new governments have been searching for ways to make the transition to decentralized market economies. In this volume, leading economists, from both East and West, explore and map the differing paths taken by individual countries, including the (former) Soviet Union, Poland, Czechoslovakia, Hungary, and the now defunct GDR. Although the contributors agree the road to transformation will not be smooth, they express a variety of views on what they consider to be viable policies for marketization. The contributors analyze problems of privatization, marcroeconomic stabilization, new patterns of foreign trade, the evolution of new economic and social organizations and the sequencing of the different reform elements. They also consider the complex interrelationship between democratization, nationalism and economic reform.

The labor-force participation of married women in the Soviet Union: A household cross-section analysis

Approximately 80% of women in the Soviet Union ages 15-54 years are employed outside the home. To identify the impact of demographic and economic variables on the high rate of labor force participation among Soviet women, data from an income survey of 1016 2-parent families of emigrants to Israel were analyzed. It was hypothesized that differences in participation rates among Soviet women correspond to differences in other sources of family income, wage rates and market conditions, level of education, and family household conditions, with response to changes in economic variables mediated by the role played by persuasion and social pressure in encouraging women to participate. Overall, 89.3% of the women in the sample were labor force participants. Nonparticipants were, as expected, from families with higher levels of other income. The personal qualifications of nonworking wives were considerably lower than those of working wives, with nonworking wives averaging 9.4 years of schooling compared with 13.2 years for working wives. Offered wages for working wives averaged 69 kopecks/hour in contrast to 40-50 kopecks/hour for nonworking women. A maximum-likelihood functional estimation of participation rates whoed significant coefficients for family income (negative), expected wages and education (positive), and residence in a large city (positive). The coefficients for residence in a medium-sized city, existence of a private plot, presence of nonworking men in the household, occupational status of the husband, and total number of children were insignificant. The supply of hours of work was backward-bending. The results suggest that Soviet women reach the decision to participate in the labor force through consideration of the same factors as their counterparts in nonsocialist countries. The analysis further indicates that, at present levels of fertility and exogenous conditions, the participation rate in the Soviet Union will not decrease. However, policies designed to raise the fertility level, including better facilities for children and more support for women who leave the labor force to raise young children, could ease labor force participation among soviet women.

Industrial Structure, Urbanization, and Socialist Growth Strategy

This paper compares the structural changes that took place in the economies of seven socialist, centrally planned countries in East Europe with similar changes in market economies. The comparisons are for the period 1950 to 1970, the formative years of the socialist regimes, with references to 1940. The purpose of these comparisons is, first, to demonstrate that the patterns of structural changes of these two groups of countries are different and, second, to link those differences to specific aspects of the growth strategy of the socialist countries (SOC).