Transition reforms in transition economies - Case study for SEE countries

• Author: Malësor Kelmendi - Jeton Zogjani
• Pages: 442-451

ISSN 2410-759X Balkan Journal of Interdisciplinary Research Vol 1 No 1

Acces online at www.iipccl.org IIPCCL Publishing, Tirana-Albania May 2015

442

Transition reforms in transition economies -

Case study for SEE countries

Malësor Kelmendi,

Jeton Zogjani, MSc

Abstract

In this research paper is analyzed transition reforms in transition economies with case study SEE

countries and the main theoretical arguments for discussions are as following: the eect of transition

reforms during transition processes in SEE countries, the impact of these reforms in institution and

policy aspects, then their eect to economy, education and overall aspects in these countries. In

methodology, the secondary data that is used is collected from international institutions and they

are calculated through STATA program. e main analysis include: descriptive statistic, multiple

regression analysis and correlation matrix. Based on empirical results, in the OLS regressions

analysis is found that economic growth and nancial market development have negative impact

on transition reforms (enterprises reforms and market & trade reforms). Innovation reform has

negative impact on enterprises reforms but it has shown positive impact on market and trade

reforms. Other variables have shown positive impact on transition reforms in the SEE countries.

In T-statistic analysis all independent variables have shown negative signicance (T<2) on two

transition reforms. In correlation methods, all variables that are including on research paper have

shown positive correlation on transition reforms (except economic growth). In conclusion, all of

SEE countries must attempt the processes of reforms because the reforms are very necessary for

economic sustainable, political stability and institutional consolidation, process of integration and

in other important challenges in the future.

Keyword : Enterprises reform, growth, regression analyses, STATA program, trade reform

Introduction

Dierent discussion for few decades have existed about reforms in the transition economies

and still exist discussion over pacing and sequencing reforms and dynamic of transition

reforms (Stiglitz, J.E., 1999). When the transition countries changed their orientation in

economy and politic aspects from the totalitarian system to the liberalization markets,

institutional stability has played a crucial role in these countries. Also macroeconomic

stabilization and structural reforms have the important impacts in transition economies,

(Ubiergo et al, 2006). Processes of transition reforms have strong impact in economic and

state activity and it is realized through in two main aspects: a) privatization of enterprises

and the liberalization and b) changes in government expenditures, transfers and taxes

(Peev, E. & Muelle, D.C., 2012). en privatization and price liberalization are considered

as internal reform with greater eects in transition economies, (Barlow et al, 2009).

However, as a key detail to orient the market reforms in future is to focus on improving

innovation and knowledge in all transition economies, particularly being focused on

creating innovation culture, supporting innovative companies and rising the government

and local support for this eld in the future, (Baković, 2010).

During the initial phrase of transition, as main elements in most transition countries (in context

of economic development and growth) were sustainable institutions (Beck, . & Laeven,

L., 2006). In fact, transition processes in many transition countries have brought negative