Which of the following statements about the privatization and marketization of countries transitioning from communism is accurate?
A) Those advocating shock therapy wanted to minimize the short-term social disruptions of marketization.
B) Inflation and hyperinflation were fears of those who advocated a gradual approach to marketization.
C) Postcommunist countries almost universally sought to privatize by distributing firms' shares to the public as a whole.
D) Most postcommunist countries agreed that privatization should occur and be allowed to complete its course before marketization was attempted.

Question

Quizplus · Accepted Answer

Inflation and hyperinflation were indeed fears of those who advocated a gradual approach to marketization, as sudden shocks to the economy could lead to price instability and economic uncertainty. Shock therapy, on the other hand, aimed to rapidly transition to a free-market economy, but was criticized for ignoring social disruptions and exacerbating inequalities. The privatization methods used in postcommunist countries varied widely, with some opting for distribution of shares to the public, while others utilized voucher programs, auctions, or insider sales. There was also debate about whether privatization should occur before or after marketization, with proponents of the former arguing that private ownership would incentivize market reforms, while the latter argued that marketization should take precedence in stimulating economic growth.

Which of the Following Statements About the Privatization and Marketization