Institutional Reform in Transition Economies: How Far Have they Come

IMF Working Papers, August 1, 2001

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Institutional Reform in Transition Economies: How Far Have they Come

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Bibliographic details

• Authors: Beatrice Weder
• Published: August 1, 2001
• Series: IMF Working Papers
• DOI: https://doi.org/10.5089/9781451853797.001

Summary and main findings

• The paper examines how institutional conditions in transition economies compare with those in the rest of the world using various indicators of governance.
• Geographic focus: countries in Central and Eastern Europe and the former Soviet Union; when possible, transition countries in Asia and Africa are also considered.
• Main findings:
  • Transition economies, as a group, are no longer distinguishable from other economies.
  • There are large differences in institutional performance within the group of transition economies.
  • A formal cluster analysis maps transition economies into homogeneous groupings; transition economies are found in all clusters (from best to worst institutional performers).
  • A group of five countries, all of which are EU accession countries, appear to have “graduated”: when taking into account their level of income, their institutional conditions are no longer distinguishable from those in the most advanced industrialized countries.

Analysis and methodology

• Comparative analysis based on various indicators of governance.
• Formal cluster analysis used to map transition economies into homogeneous groupings of countries.
• Consideration of income levels in assessing whether institutional conditions are distinguishable from those in advanced industrialized countries.

Implications and interpretive points

• Heterogeneity within transition economies implies that aggregate group labels obscure substantial within-group differences in institutional performance.
• EU accession status is associated with a subset of transition countries reaching institutional conditions comparable with advanced industrialized countries, once income is taken into account.

Content in this bundle

• Institutional Reform in Transition Economies: How Far Have They Come? - WP/01/114
  • Institutional Reform in Transition Economies: How Far Have They Come? - WP/01/114 (Markdown version)
  • Institutional Reform in Transition Economies: How Far Have They Come? - WP/01/114 (PDF)