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Balcerowicz Plan
The Balcerowicz Plan (), also termed " Shock Therapy", was a method for rapidly transitioning from an economy based on state ownership and central planning, to a capitalist market economy. Named after the Polish minister and economist Leszek Balcerowicz, the free-market economic reforms were adopted in Poland in 1989. A group of experts, which they formed together with Balcerowicz, including Stanisław Gomułka, and , in September 1989 created a reform plan based on an earlier idea of Jeffrey Sachs, and on 6 October, an outline of this plan was presented to the public by Balcerowicz at a press conference broadcast by TVP. There was a 3 year drop in output. Similar reforms were made in a number of countries. The plan has resulted in reduced inflation and budget deficit, while simultaneously increasing unemployment and worsening the financial situation of the poorest members of society. Background The unofficial talks () at Magdalenka and then the Polish Round Table talks o ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Shock Therapy (economics)
In economics, shock therapy is a group of policies intended to be implemented simultaneously in order to liberalize an economy, including liberalization of all prices, privatization, trade liberalization, and stabilization via tight monetary policies and fiscal policies. In the case of Post-communism, post-communist states, it was implemented in order to transition from a planned economy to a market economy. More recently, it has been implemented in Argentina by the administration of Javier Milei. Overview Shock therapy is a program intended to economically liberalize a mixed economy or transition a planned economy or developmentalist economy to a free-market economy through sudden and dramatic neoliberal reform. Shock therapy policies generally include ending price controls, stopping government subsidies, privatizing state-owned industries, and tighter fiscal policies, such as higher tax rates and lowered government spending. In essence, shock therapy policies can be distilled t ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Marxian Economics
Marxian economics, or the Marxian school of economics, is a heterodox school of political economic thought. Its foundations can be traced back to Karl Marx's critique of political economy. However, unlike critics of political economy, Marxian economists tend to accept the concept of the economy prima facie. Marxian economics comprises several different theories and includes multiple schools of thought, which are sometimes opposed to each other; in many cases Marxian analysis is used to complement, or to supplement, other economic approaches. An example can be found in the works of Soviet economists like Lev Gatovsky, who sought to apply Marxist economic theory to the objectives, needs, and political conditions of the socialist construction in the Soviet Union, contributing to the development of Soviet political economy. Marxian economics concerns itself variously with the analysis of crisis in capitalism, the role and distribution of the surplus product and surplus value in ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Hyperinflation
In economics, hyperinflation is a very high and typically accelerating inflation. It quickly erodes the real versus nominal value (economics), real value of the local currency, as the prices of all goods increase. This causes people to minimize their holdings in that currency as they usually switch to more stable foreign currencies. Effective capital controls and currency substitution ("dollarization") are the orthodox solutions to ending short-term hyperinflation; however, there are significant social and economic costs to these policies. Ineffective implementations of these solutions often exacerbate the situation. Many governments choose to attempt to solve structural issues without resorting to those solutions, with the goal of bringing inflation down slowly while minimizing social costs of further economic shocks; however, this can lead to a prolonged period of high inflation. Unlike low inflation, where the process of rising prices is protracted and not generally noticeab ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Popiwek
Popiwek (an acronym of PPWW, short for ''Podatek od ponadnormatywnych wypłat wynagrodzeń'', ) was a tax introduced in Poland in 1984. Although created by the communist authorities and initially hidden under the name of "Fee for the National Work Activization Fund," it is primarily associated with the 1989 Balcerowicz Plan. It was used as one of the elements that was to fight the hyperinflation In economics, hyperinflation is a very high and typically accelerating inflation. It quickly erodes the real versus nominal value (economics), real value of the local currency, as the prices of all goods increase. This causes people to minimiz ... (reaching 251%) that struck Poland in the 1980s. It created a state-controlled level of wages that was tied to the level of inflation and taxed all companies that exceeded those wage rise limits. In 1991, the tax was lifted for privately-held companies, and the following year, it was withdrawn altogether. References Taxation in Poland ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Interest Rate
An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited, or borrowed (called the principal sum). The total interest on an amount lent or borrowed depends on the principal sum, the interest rate, the compounding frequency, and the length of time over which it is lent, deposited, or borrowed. The annual interest rate is the rate over a period of one year. Other interest rates apply over different periods, such as a month or a day, but they are usually annualized. The interest rate has been characterized as "an index of the preference . . . for a dollar of present ncomeover a dollar of future income". The borrower wants, or needs, to have money sooner, and is willing to pay a fee—the interest rate—for that privilege. Influencing factors Interest rates vary according to: * the government's directives to the central bank to accomplish the government's goals * the currency of the principal sum lent or borrowed * the term to m ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Central Bank
A central bank, reserve bank, national bank, or monetary authority is an institution that manages the monetary policy of a country or monetary union. In contrast to a commercial bank, a central bank possesses a monopoly on increasing the monetary base. Many central banks also have supervisory or regulatory powers to ensure the stability of commercial banks in their jurisdiction, to prevent bank runs, and, in some cases, to enforce policies on financial consumer protection, and against bank fraud, money laundering, or terrorism financing. Central banks play a crucial role in macroeconomic forecasting, which is essential for guiding monetary policy decisions, especially during times of economic turbulence. Central banks in most developed nations are usually set up to be institutionally independent from political interference, even though governments typically have governance rights over them, legislative bodies exercise scrutiny, and central banks frequently do show resp ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Budget Deficit
Within the budgetary process, deficit spending is the amount by which spending exceeds revenue over a particular period of time, also called simply deficit, or budget deficit, the opposite of budget surplus. The term may be applied to the budget of a government, private company, or individual. A central point of controversy in economics, government deficit spending was first identified as a necessary economic tool by John Maynard Keynes in the wake of the Great Depression. Controversy Government deficit spending is a central point of controversy in economics, with prominent economists holding differing views. The mainstream economics position is that deficit spending is desirable and necessary as part of countercyclical fiscal policy, but that there should not be a structural deficit (i.e., permanent deficit): The government should run deficits during recessions to compensate for the shortfall in aggregate demand, but should run surpluses in boom times so that there is no ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Sejm
The Sejm (), officially known as the Sejm of the Republic of Poland (), is the lower house of the bicameralism, bicameral parliament of Poland. The Sejm has been the highest governing body of the Third Polish Republic since the Polish People's Republic, transition of government in 1989. Along with the upper house of parliament, the Senate of Poland, Senate, it forms the national legislature in Poland known as Parliament of Poland#National Assembly, National Assembly (). The Sejm comprises 460 Member of parliament, deputies (singular or ) elected every four years by Universal suffrage, universal ballot. The Sejm is presided over by a Speaker of parliament, speaker, the "Marshal of the Sejm" (). In the Kingdom of Poland (1385–1569), Kingdom of Poland, the term ''Sejm'' referred to an entire two-Chambers of parliament, chamber parliament, comprising the Chamber of Deputies (), the Senate and the King. It was thus a three-estate parliament. The 1573 Henrician Articles strengthe ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Premier Of Poland
Premier is a title for the head of government in central governments, state governments and local governments of some countries. A second in command to a premier is designated as a deputy premier. A premier will normally be a head of government, but is not the head of state. In presidential systems, the two roles are often combined into one, whereas in parliamentary systems of government the two are usually kept separate. Relationship to the term "prime minister" "Premier" is often the title of the heads of government in sub-national entities, such as the provinces and territories of Canada, states of the Commonwealth of Australia, provinces of South Africa, the island of Nevis within the Federation of Saint Kitts and Nevis. In some of these cases, the formal title remains "Prime Minister" but "Premier" is used to avoid confusion with the national leader. In these cases, care should be taken not to confuse the title of "premier" with "prime minister". In these countries, ter ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Shortage Economy
In economics, a shortage or excess demand is a situation in which the demand for a product or service exceeds its supply in a market. It is the opposite of an excess supply ( surplus). Definitions In a perfect market (one that matches a simple microeconomic model), an excess of demand will prompt sellers to increase prices until demand at that price matches the available supply, establishing market equilibrium. In economic terminology, a shortage occurs when for some reason (such as government intervention, or decisions by sellers not to raise prices) the price does not rise to reach equilibrium. In this circumstance, buyers want to purchase more at the market price than the quantity of the good or service that is available, and some non-price mechanism (such as "first come, first served" or a lottery) determines which buyers are served. So in a perfect market the only thing that can cause a shortage is price. In common use, the term "shortage" may refer to a situat ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Unemployment
Unemployment, according to the OECD (Organisation for Economic Co-operation and Development), is the proportion of people above a specified age (usually 15) not being in paid employment or self-employment but currently available for work during the reference period. Unemployment is measured by the unemployment rate, which is the number of people who are unemployed as a percentage of the labour force (the total number of people employed added to those unemployed). Unemployment can have many sources, such as the following: * the status of the economy, which can be influenced by a recession * competition caused by globalization and international trade * new technologies and inventions * policies of the government * regulation and market * war, civil disorder, and natural disasters Unemployment and the status of the economy can be influenced by a country through, for example, fiscal policy. Furthermore, the monetary authority of a country, such as the central bank, can in ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Inflation
In economics, inflation is an increase in the average price of goods and services in terms of money. This increase is measured using a price index, typically a consumer price index (CPI). When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reduction in the purchasing power of money. The opposite of CPI inflation is deflation, a decrease in the general price level of goods and services. The common measure of inflation is the inflation rate, the annualized percentage change in a general price index. Changes in inflation are widely attributed to fluctuations in Real versus nominal value (economics), real demand for goods and services (also known as demand shocks, including changes in fiscal policy, fiscal or monetary policy), changes in available supplies such as during energy crisis, energy crises (also known as supply shocks), or changes in inflation expectations, which may be self-fulfilling. Moderat ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
