Economic policy and economic growth

A relationship between economic policy and economic growth is analyzed in the present paper. Special attention is paid to the situation in the countries still facing the heritage of central planning and real socialism. Even though the efforts of all postsocialist countries in a transition period to market economy were focused on privatization, internal and external price liberalization and balanced public accounts, accompanied by a conviction that economic growth will follow, a gap between the real situation and the considerations is large. Solid and permanent market relations were established practically in all postsocialist countries - but with some exceptions, the economic growth has not come. Endogenous economic growth is analyzed at first, then a standard theory of specialization in the world economy is applied to this concept: an explanation of differences in longterm growth rates between the separate countries is provided. The conclusions are used to elucidate the nature and problems of economic growth in postsocialist countries.