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Abstract disponibile solo in lingua inglese
This paper applies the property-rights question – "what does it take to implement economic reforms in the Soviet Union?" – to the following three objectives of perestroika: i) making business firms more efficient, ii) increasing the supply and variety of consumer goods, and iii) reducing the power of Soviet bureaucracy. For the purpose of analysis, those three objectives of perestroika are classified as the problem of trade-off, the problem of the social opportunity set, and the agency problem. The purpose of the paper is to discuss economic reforms in the USSR in terms of i) reasons behind the decision in the mid-1980s to implement reforms, and ii) changes in the institutional structure which their implementation would require.
The property-rights analysis rejects the traditional wisdom of political philosophy whereby better people make better government and better policies lead to better outcomes. It argues that games depend on their rules. Applied to economic reforms in the USSR, the property-rights analysis says that better planners and technically superior policies could have only a marginal effect on Soviet economic performance. If and when the Soviet government begins to change institutions, the implementation of economic reforms will be on the way. As long as the institutional structure remains what it is today, Soviet economic reforms should be considered a façade of words.