IMF Working Papers

Establishing Incentive Structures and Planning Agencies That Support Market-Oriented Transformations

By Peter Isard, Michael P. Dooley

November 1, 1991

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Format: Chicago

Peter Isard, and Michael P. Dooley Establishing Incentive Structures and Planning Agencies That Support Market-Oriented Transformations, (USA: International Monetary Fund, 1991) accessed October 6, 2024
Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This note addresses various types of incentives that must be established before a market economy can function effectively. It also argues that the enormous challenge of restructuring large industrial enterprises or reabsorbing their workers, while appropriately based on market signals, cannot be accomplished by the market alone. Some type of planning will eventually be required. Ideally, such planning should receive high priority from the outset with clear recognition that durable macroeconomic stabilization will be very difficult to achieve in a democratic political system until the large state enterprises have been successfully transformed or their workers reabsorbed.

Subject: Balance of payments, Capital inflows, Capital outflows, Credit, Current account, Foreign exchange, Money, Tax incentives

Keywords: Baltics, Capital inflows, Capital outflows, Central and Eastern Europe, Credit, Current account, Eastern Europe, Enterprise, Enterprise decision makers, Government, Hard currency, Income support, Insolvent firm, Market, Market mechanism, Nonfinancial enterprise, State enterprise, State enterprise sector, Transformation effort, WP

Publication Details

  • Pages:

    16

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 1991/113

  • Stock No:

    WPIEA1131991

  • ISBN:

    9781451853643

  • ISSN:

    1018-5941

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