SOCIAL CHOICE IN EASTERN-EUROPE

Social choice theory is employed to explain some deeper reasons for the sudden collapse of Soviet-type systems. A long period of preparation preceded the crises, which was closely related to the transformation of encompassing organizations into coalitions of special-interest groups. The elimination of competition, the increasing role of bargaining and compromise in the planning process, and the rewarding of special interests at the expense of the whole society indicate this trend. Radical systemic change can live up to expectations only if it involves abolishing many special interest organizations and their distributional coalitions. © 1991.