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CHAPTER 36 Economic Growth in Developing and Transitional Economies
The Transition to a Market Economy
Six Basic Requirements for Successful Transition
Macroeconomic Stabilization
To achieve a properly functioning market system,
prices must be stabilized.
Deregulation of Prices and Liberalization of Trade
An unregulated price mechanism ensures an
efficient allocation of resources across industries.
Private ownership provides a strong incentive for
efficient operation, innovation, and hard work that
is lacking when ownership is centralized and
profits are distributed to the people.
© 2009 Pearson Education, Inc. Publishing as Prentice Hall Principles of Economics 9e by Case, Fair and Oster
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