Perhaps the most striking institutional change over the last 30 years is the transition from some kind of state-governed and planned economy to a more open economic system governed by the market. This development has occurred or is currently occurring in countries that are often labelled transition economies or emerging markets. Included among these countries are China, India and Russia, as well as most other countries in the ‘communist bloc’ in the former Soviet Union, as well as Central and Eastern Europe. Within the market economies of Europe, similar, although less dramatic, changes in the mix between planned and market exchange have been implemented. Industrial sectors, for instance telecom, air transport and energy, have been transformed from plan governance to open market governance through an institutional deregulation. The plans and the associated authorities in planned economies are being abolished, prices are being liberalised and the countries, or the industrial sectors, are moving towards increasingly open market economies. The relative merits and problems of the two modes of coordination of economic life have been analysed and discussed in a number of studies. Coase (1937), Hayek (1945) and Williamson (1975) are examples of scholars who have analysed the plan (hierarchy) versus the market mechanism of economic coordination.
|Title of host publication||Extending the Business Network Approach|
|Subtitle of host publication||New Territories, New Technologies, New Terms|
|Editors||Peter Thilenius, Cecilia Pahlberg, Virpi Havila|
|Number of pages||26|
|Publication status||Published - 12 May 2016|