In This Review

The Polish Economy: Crisis, Reform, and Transformation
The Polish Economy: Crisis, Reform, and Transformation
By Ben Slay
Princeton University Press, 1994, 229 pp.

One of the most dramatic economic experiments in recent years was the "big bang" economic reform of Poland. In January 1990, Poland undertook macroeconomic stabilization, price liberalization, currency convertibility, and abandonment of controls on foreign trade, all at the same time.

The good news is that Poland's economy survived and is once again growing, thanks to free markets and integration into the world economy. Contrary to frequent assertions, a currency can become convertible overnight, and exports can respond rapidly to new profitable opportunities.

The bad news is that privatization of Poland's large state enterprises has stalled, and former communists and their allies won a majority in Poland's second free parliamentary elections in more than 60 years, two years after the first one in October 1991.

Ben Slay, of Middlebury College, has usefully provided an overview of economic policy, economic events, and the tangle of Poland's politics during the period from 1989 to the September 1993 elections. He helpfully discusses the complicated political traditions of Poland and the extensive transformation of the Polish economy that occurred under communist rule during the 1980s. He reports on, but does not attempt to explain, the ambivalence of former Solidarity leader and now President Lech Walesa toward economic reform and his complicating behavior toward reform-minded politicians.

The book's most recent data are for 1992, and those are preliminary or incomplete. The book is best viewed as an interim report. The saga no doubt will provide material for many more.