Prague Economic Papers 1997, 6(4) | DOI: 10.18267/j.pep.138

Fiscal convergence to the countries of european union and the state burden

Vladimír Benáček

There is no doubt that the same economic regularities are effective in economies in the stage of advanced economic transformation as in traditional market economies. But the low productivity and relics of institutions from the totalitarian system make them very different. Some immature markets of these economies, e.g. labor, money, capital and real property ones, are combined with a huge burden of the non-market public sector, which is mainly borne by budgets of central and local governments. It is not true in any case that any of the former Comecon economies would suffer from an excess of market dictate . It would be worth asking a question to what extent all these economies suffer from market imperfections (e.g. absence of some markets or rent seeking) and from the fact that the government and bureaucracy are still involved in numerous non-market and regulatory responsibilities. As shown by some comparative studies, the government's economic influence significantly goes beyond the scope of their rampant state budgets.

Published: January 1, 1997  Show citation