Corruption in Cuba: Castro and Beyond

By Sergio Díaz-Briquets; Jorge Pérez-López | Go to book overview

One
CORRUPTION
AND TRANSITIONS

The long-delayed transition in Cuba gives policy makers the opportunity to consider averting corruption an integral part of the overall transition strategy. Corruption imposed a heavy burden on the economic transition of the former Soviet Union and its East European allies, just as it did in post-Sandinista Nicaragua. Expectations for reconstituting these countries into modern nation-states with political and economic structures akin to those of the democratic, market-oriented West were in many cases dashed in no small part because of corruption. As these former socialist countries started the transition, the priorities of policy makers were macroeconomic stabilization, liberalization of prices in product markets, privatization of state-owned property, creation of an institutional base to support the market, and establishment and nurturing of democratic institutions. As these economic and political transformations were being carried out, the potential for corruption to derail a successful transition was not understood. Only in hindsight have the enormous negative effects of corruption on the transition process been appreciated.

More than a decade into the transitions of the former Soviet Union and the socialist countries of Eastern Europe, a body of literature has emerged that assesses the strategies and outcomes of such transitions (e.g., Aslund 2002; Svejnar 2002; World Bank 2002). The consensus is that the transitions have been painful—more so than was initially envisioned—and resulted in deeper reductions in output than anticipated. Initial conditions (among them geography and natural resources, years spent under central planning, specific nature of socialist development) had a very significant influence on performance, particularly in the early stages of the transition. It is clear that politicians and economists underestimated the difficulty of the transition and that in some instances questionable policy choices were made. Although growth performance has varied greatly across reforming countries, those nations that made the most concentrated reform efforts

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