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Perspectives on Liberalisation during Transition

Liberalisation is generally taken to be synonymous with removal of price controls and barriers to trade. In the following paper, the measurement of liberalisation and its impact on economic growth are discussed. The relationship between liberalisation and growth is often studied at the macro-level, but the mechanisms by which liberalisation affects growth are to be found mainly at the micro-level. Interestingly, there appears to be a significant negative correlation between the importance of agriculture in transitions countries and both their openness and growth performance. The paper concludes with some thoughts about the importance of liberalisation in the rest of the world for the transition economies. Paper presented at the KATO Symposium Berlin, Germany, November 2-4, 2000