Informal Economy in the Socialist States and the Emergence of Capitalism after 1989 - Essay Example

Discuss the relationship between the informal economy in the socialist s and the emergence of capitalism in these s after 1989. Total word count: 1274 words/ 5 pages Sources: 7 Format: MLA Introduction: Socialist states, according to Marx are the ones that have put an end to capitalism and going through the phase of social and economic development that is eventually replaced by communism. Conversely a communist state observes a single party rule following the communist concept of ruling a state. Each country goes through such phases over the centuries making mistakes and improving them in the long run, this in turn affects the country economically and politically. The twentieth century witnessed the major transformation of the Eurasia and many other parts of the world in terms of political economies. This was referred to as the socialist experiment that became defunct in the year 1989 throughout the Eastern Europe for unidentified reasons, eventually resulting in the end of the Soviet Union in 1991. This in turn, unlocked new doors of transitions and socio cultural transitions in the region. The formal economy is the essence of the contemporary perceptive of the states following the capitalist concept to influence the globe whereas the informal economy is the unpredictable or irregular perception designed and practiced by specific people although these are less powerful than the ones endorsed by dominant power and wealth. The study of the same era and the historical accounts help one to understand the theory of socialism and its practice as well as the changes that occurred from region to region. For instance China, the largest country in East Asia developed into a socialist state in 1949 and the Republic of Cuba witnessed the Cuban Revolution that led to the overthrow of the Dictator government of Cuban President Fulgencio Batista on January 1, 1959 by the 26th of July movement and other revolutionary organizationsin 1959, and was declared a socialist state in 1961. socialist states and the emergence of capitalism: The trends occurring in socialist and post socialist Eastern Europe and akin in the capitalist West, such as privatization, the growth of neo-liberalism or the weakening of the welfare state resulted in many changes over the years. According to Pine (1996) the importance of class and gender equality became bona fide in the Eastern European states after the end of socialist states therefore allowing equal rights to the women with the likes of men in the society. As in Poland where previously extremely progressive rights were practiced that failed to be implemented in the socialist period. The Eastern Europe observed the same with women consigned to the private sphere, depriving them of basic rights. The same observation has been derived by Foucault (1991) regarding the improvement in the governmental operations in terms of practicality and efficiency through the historical perspective by learning and inventing innovative likewise improved plans of governing. Disparagement further stimulates such progress through the modifications in actions and extensions of limits. If we study the comparisons of some post socialism countries, using ethnographic examples we come to know that vast diversities from Hungary, Romania and Transylvania considering each nation has a different backdrop of the post socialism period along with specific array of tribulations. The Hungarian ethnographers demonstrated dissimilarities in personalities, interests and specializations between the North American and native European ethnographic studies. In Eastern Europe citizens were faced with colonialists, Western and capitalist society settings. Considering similar issues the anthropological studies and comparisons of the Eastern Europe with the Third and fourth world countries were conciliatory. As Verdery (1999) points out the presence of additional features of socialism that made general ideas significant for normal people living in regions having ethnic groups amalgamated rather than territorially alienated. The predicaments created by socialism eventually replaced by the socio-economic structures gave rise to the issues for citizens from bureaucrats and elites, of ordinary workers, of entrepreneurs and peasants suffering the consequences of the Soviet Union before 1917 and the Eastern alliance regions prior to the year 1945, both economically and politically. The study of such historical accounts of the nations affects the rising autonomies and fully defines the national citizenship through monuments and written accounts. The society envisioned by Marx was based on communism relying on sociable authority, however it transformed into an intimidating one by the power striving communist parties. The government officials malformed the state from the core, by means of official and unofficial relevancies all the while steadily customizing the state power and using them for personal benefits. The Planned and the unplanned economies: Pine (1996) elaborates the communism Czechoslovakia witnessed after the socialist period that gave birth to the private production and ownership economically. This change witnessed the improvement in the lives of peasant women providing equality of employment and collective responsibility of domestic labor. Hungarians faced the same dilemma which as Verdery and Burawoy (1999) notes that the post 1989 era saw a 50% increase in the allotment of credits to the individual peasants corresponding to the development of individual agricultural production. Similarly as Abraham points out the agricultural situation between the years 1989 to 1991 displayed the conflicts among socialists and communists that resulted in the instigation of involvement of different players as well as private ownership in the field thus benefiting the agricultural economy and in return the working class people. The communist work place initially projected to interweave ideology, production and formulate the socialist individual. Verdery and Burawoy (1991) analyzed the socialist financial system as the contractor benefited from the ascendancy compared to the consumer thus influencing the workplace that in return affected the formal and informal economies. Since it is proven that how important is the government department that acts as the axis of workers and the state and is formulated through the concept of regimenting. The informal economy that became active after the end of socialism supporting the administrative region financial matters as well by helping to materialize new forms of industrialists. Such promising industrialists have the skill to negotiate positions of power as well as control the resources of the state for accumulation of fortune. Privatization on the previously governmental organizations had a great effect on the lives of their employees. Bonnell and Gold too emphasize the new breed of entrepreneurs that came to being in Poland after 1989 at the end of socialism period, swiftly adapting to the Western modern of marketing and conducting business. Hence supporting the notion that the communism proved to be a much economically sound era compared to the socialism period. The retreat of the Eurasia state from socialism to communism displayed improved and positive consequences in terms of informal economy gradually eradicating the private sector all the while augmenting the public sector. This obliterated the prior concepts of the Eastern Europe and many other states that the suffering economies can be converted into flourishing ones by incorporating the economic policies and the available resources therefore engulfing the traditional sector into the formal economy once and for all. However, later years and the rise of communist society demonstrated that the traditional sector also holds a major importance in the region and in turn for the economy. Conclusion: Anthropological investigation conducted in post socialism era disbands the prior notion of the transformations before socialism through the millenarian vision, realizing an intractable veracity that in turn affected many communist nations. It is unerringly the altercation involving the lived experience and the master plans that contributions should enlighten. The economy differences among the socialist and the capitalist states are evident throughout this paper, hence proclaiming the fact that the informal economy did play an imperative part in both the eras. Especially considering the augmentation in the entrepreneurship and personal business as well as the new availability of employments also helped to amend the citizen's financial worries in turn benefiting the nation. Sources Cited: Burawoy M and K, Verdery (eds) 1999 Uncertain Transition: Ethnographies of Change in the post socialist world, Boulder; New York; Oxford: Rowman and Littlefield. Foucault, M. 1991 Governmentality In The Foucault Effect: Studies on Governmentality G. Burchell et. al. eds Hann C (ed) 1993 Socialism: ideals, ideologies and local practice, (ASA Monographs No. 31), London: Routledge Marx K, Feuerbach L, Engels F, Schirmacher W, 1997 German socialist philosophy, Continuum International Publishing Group Pine, F. 1996 "Redefining Women's Work in Rural Poland" In after Socialism: Land Reform and Social Change in Eastern Europe, Ray Abrahams ed. V. E. Bonnell and T. B. Gold, New Entrepreneurs of Europe and Asia. eds. New York: M.E. Sharpe. Yurchak, A. 2002 "Entrepreneurial Governmentality in Post socialist Russia" In The Read More