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Restructuring infrastructure in transition economies
The provision of telecommunications, electricity and transport in centrally
planned economies was distinguished from that in market economies in at least
three ways. Certain infrastructure services were abundantly supplied to
industry with little regard for their costs of production. An ideological bias
favoured material production but neglected services so there was relatively
little investment in telecommunications. Vital infrastructure services, such
as electricity and urban transportation, were provided to households for free
or for a nominal charge. All three proved unsustainable in a market economy.
The purpose of this paper is thus to characterise the infrastructure
restructuring challenge in the transition economies and to examine carefully
the government policies that can promote this restructuring effectively.
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