Getting to MarketIssue: Spring 1991
Over the past century, economists and other intellectuals have produced an enormous amount of literature on how to convert capitalist market economies into socialist centrally planned ones. Among the better known contributors to it are Sidney and Beatrice Webb, Oskar Lange, Abba Lerner, Joan Robinson, Nicholas Kaldor, Paul Sweezy, Wassily Leontief, and J.K. Galbraith; but there are many, many others.
It is ironic that the reverse problem of converting socialist economies into capitalist ones has received scant attention. The writings of Friedrich Hayek, Joseph Schumpeter, Milton Friedman, and P.T. Bauer are partial exceptions, but their focus has usually been elsewhere: namely, exposing the errors made by the advocates of socialism rather than charting the transformation. Hence, there is no general theory to draw on in addressing the crucial economic policy problem of the 1990s: how to transform command economies into market economies.