The Origins of Capitalist Markets: Transition in Poland with Comparisons to East Asian Capitalism

Abstract

The main concern of this paper is the role of government in the birth and development of industrial capitalism. Does the emergence of proper institutional arrangements allow for the birth of a modern market economy, or alternatively must capitalism be established through government regulation? Can the rapid development of appropriate capitalist institutions set free a particular mode of behavior with the invisible hand operating to force the emergence of a modern industrial economy? We explore this old question' in light of developments occurring in Poland since 1989. The final section of the paper provides an outline description of the development of East Asian industrial capitalism for purposes of comparison with the socialist economies of Eastern Europe.