Should we celebrate the fall of the Soviet Union

Rosser Jr, John Barkley rosserjb at
Tue Jul 14 11:13:59 PDT 1998


I am not in my usual location and so don't have my usual ready sources to access for citation, but:

The distribution of industry was fairly similar in both places, with the variations being much more localized within both the East and the West. There were major steel complexes in both the West (the Ruhr) and in the East (Silesia). There was also modern industry in both places, Zeiss Optical being an example in the East that would go on to become a major CMEA supplier, but has been bought out since reunification.

You are right that there were differences in social structures and political traditions, with the Junker/Prussian tradition in the East being very strong. But there are other divisions within Germany as well, the north/south one being at least as significant as the east/west one, indeed arguably more so (Bavaria against the rest).

The collapse in the former GDR remains one of the most dramatic ever seen in world history. My understanding, reinforced by discussions with some German economists at the PK Workshop in Knoxville, is that the "convergence" between east and west has slowed down if not halted completely, and the East is increasingly looking like turning into a permanent "Mezzogiorno problem," although there are pockets in some of the larger cities that are booming.

As regards the old pre-unification West/East comparison, the East also had a more equal distribution of income than the West as well as a better treatment of women who have really suffered under the reunification. According to official stats just prior to the reunification, per capita income in the GDR was almost at par with that in the FRG. But this proved to be illusory as we now all know. And curiously enough one area where the West was farthest ahead was in environmental quality.

BTW, at least some of the things that Louis P. cited as being why a Guatemalan would think they had "died and gone to heaven" if they woke up in the old GDR would also hold in the FRG, e.g. free medical care and education. Barkley Rosser Barkley Rosser On Tue, 14 Jul 1998 10:04:00 -0700 Michael Perelman <michael at> wrote:

> Barkley might be off base here. I thought that the industry in the east was
> largely old line, steel-like manufacturing. In part, the appeal of the Nazis to
> big business was its protection of these outdated dinasaur firms. If so, the
> figures that he is using are likely to be distorted. Where was the more modern
> industry located before the war?
> Also, the E. and the W. had different social structures, with the E. more like
> Latin America and the W. more like the Asian tigers.
> Rosser Jr, John Barkley wrote:
> > Most estimates suggest approximate equality
> > between the two zones in 1939, with, if anything, the East
> > having a slight edge in industrialization.
> --
> Michael Perelman
> Economics Department
> California State University
> Chico, CA 95929
> Tel. 916-898-5321
> E-Mail michael at

-- Rosser Jr, John Barkley rosserjb at

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