How Capitalism Was Built: The Transformation of Central and Eastern Europe, Russia, and Central Asia

Here are two books by a close student of postcommunist transitions. The first, an extensive revision and expansion of an earlier book, examines all the former communist countries to emerge from the Soviet bloc, describing and evaluating the transition from centrally planned to market economies and analyzing what did and did not work. An important finding is that radical reform produced better and more durable economic performance than gradual reform and also contributed to establishing democratic political institutions, even though the immediate postreform period was painful.

The second book focuses on Russia alone. It is largely a chronological history of Russia's economic reforms, starting with those introduced by Mikhail Gorbachev in 1985. Not surprisingly, it contains some of the same analytic themes as the first book. In Aslund's view, capitalism has been effectively established in Russia, bolstered by a thriving private sector in a thriving economy. Russia's political institutions, in contrast, have reverted to a tsarist-type authoritarianism under President Vladimir Putin. The book lucidly explains the reasons for these contrasting outcomes in Russia, which are markedly different from those in most of the postcommunist eastern European countries. Åslund sees the two developments as incompatible in the long run and places his bets on an evolution toward democracy.