russia's transition economy

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ECONOMICS

RUSSIA TRANSITION ECONOMY

Transition economy means when you are moving from a kind of economy to another, Russia, had three economy transition in the last century, the first one from the feudal economy under the Tsar to the capitalist relation, the second brought the planned economy system introduced by the communists; the last one started from the 1990’s until now, and not finished yet, that is bringing Russia from the planned economy to the free market one.

The free market and the planned economies are two different kinds of economic policy that a country can use. In the free market economy, there is the so called consumer sovereignty that means that the consumer tells the producer what to produce with the interaction of demand and supply, so the resources are distributed with the price system.

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                                          Free Market System                                                                                                           

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In the planned one is different from the free market because ...

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