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Preface vii Introduction 3 PART I: THE POLITICAL ECONOMY OF THESOCIALIST STATE: CONCEPT, IMPLEMENTATION, DECAY 19 One The Planned EconomyRevisited 21 Two A Model of Innovation and the Planned Economy 49 ThreeIncentives and Producer's Behavior 74 PART II: THE POLITICAL ECONOMY OFSPONTANEOUS TRANSITION: INSIDERS' MARKETS AND THE PROBLEM OF ECONOMICEFFICIENCY 103 Four Path Dependence and the "Washington Consensus" 105 FiveIncentives and Producer's Behavior in the Transition Environment 128 SixIncentives and Producer's Behavior in the Transition Environment: TheDecision to Switch 149 Seven Pressure Groups and Oligarchic Power 169 PARTIII: THE POLITICAL ECONOMY OF A NEW SOCIAL CONTRACT: MEASURES TO PROMOTEDEMOCRACY, COMPETITION, AND ECONOMIC GROWTH 187 Eight Where Are We and WhereDo We Want to Go? The Task and Conditions for Social Engineering in Russia189 Nine Democracy: Curse or Blessing? 202 Ten Institutions, Competition,and Economic Growth 221 Eleven Devolution of Power and the Integrity of theGovernment 251 Conclusion Can We Do Better? 265 References 269 Index 275