What was Shock Therapy ? Was this the best way to make a transition from communism to capitalism ?

Solution

The process of transition from an authoritarian socialist system to a democratic capitalist system, that was influenced by the World Bank and the IMF came to be known as 'Shock Therapy'.

This was not the best way to make a transition from communism to capitalism due to the following reasons :

(i) It brought ruin to the economies and disaster upon the people of the entire region.

(ii) In Russia, the large state-controlled industrial complex almost collapsed. There was the largest garage sale in history, as valuable industries were undervalued and sold at throw away prices.

(iii) The value of the ruble- the Russian currency declined.

(iv) People lost all their savings due to high rate of inflation.

(v) The collective farm system disintegrated and people were left without food security. Russia started to import food.

(vi) The old trading structure broke down with no alternative in its place.

(vii) The withdrawal of government subsidies pushed large section of the people into poverty.(viii) Privatisation led to new disparities between rich and poor regions.(ix) The democratic constitutions of these countries were prepared in a haste and therefore, includedmany defects. For example in Central Asia, the presidents had powers and some of them became authoritarian.There was no independence of judiciary in some countries.

Some More Questions From The End of Bipolarity Chapter

Fill in the blanks:

a. The Soviet political system was based on ideology.
b. was the military alliance started by the USSR.
c. party dominated the Soviet Union’s political system.
d. initiated the reforms in the USSR in 1985.
e. The fall of the __ symbolised the end of the Cold War.

Write an essay for or against the following proposition : 'With the disintegration of the second world, India should change its foreign policy and focus more on friendship with the US rather than with traditional friends like Russia'.

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The End Of Bipolarity

What was Shock Therapy ? Was this the best way to make a transition from communism to capitalism ?

Some More Questions From The End of Bipolarity Chapter

Which among the following statements that describe the nature of Soviet economy is wrong?

Arrange the following in chronological order:

Which among the following is not an outcome of the disintegration of the USSR?

Match the following:

Fill in the blanks:

a. The Soviet political system was based on ideology.
b. was the military alliance started by the USSR.
c. party dominated the Soviet Union’s political system.
d. initiated the reforms in the USSR in 1985.
e. The fall of the __ symbolised the end of the Cold War.

Mention any three features that distinguish the Soviet economy from that of a capitalist country like the US.

What were the factors that forced Gorbachev to initiate the reforms in the USSR ?

What were the major consequences of the disintegration of the Soviet Union for countries likeIndia ?

What was Shock Therapy ? Was this the best way to make a transition from communism to capitalism ?

Write an essay for or against the following proposition : 'With the disintegration of the second world, India should change its foreign policy and focus more on friendship with the US rather than with traditional friends like Russia'.

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