Shock Therapy in Post-Communist Regimes| Class 12 Polity

In this article, we will delve deep into the topic of “Shock Therapy in Post-Communist Regimes” from Chapter 1 of the NCERT Class 12 Political Science book. These notes are specially curated by an expert team at GeeksforGeeks for all the students.

Shock Therapy in Post-Communist Regimes

• After communism fell, many countries had to switch from being ruled by a strict government to becoming democratic and capitalist. The way this change happened in Russia, Central Asia, and Eastern Europe was called “shock therapy.” It was suggested by big organizations like the World Bank and the IMF.
• Shock therapy meant these countries had to quickly and completely change to a capitalist system. This meant getting rid of everything that was made during the time of the Soviet Union. The main idea was that most things should be owned by private people or companies. They also had to sell off government-owned stuff and change farming to be more like business.
• There wasn’t any other option besides going fully into capitalism or staying with the old government-controlled way.
• Shock therapy also meant making big changes to how these countries traded with other places. They had to start trading more freely and allow foreign companies to invest in them. This meant opening up their financial systems and making their money easy to change into other currencies.
• They also stopped trading mainly with each other and started trading more with Western countries. The Western countries became the leaders and helped these countries develop in this new way.

Shock Therapy in Post-Communist Regimes: Short Notes

• The shift from an authoritarian socialist system to a democratic capitalist one in Russia, Central Asia, and Eastern Europe was influenced by the World Bank and the IMF, and it was called “Shock Therapy.” This change happened because communism collapsed.
• To move to a capitalist economy, they had to get rid of everything from the Soviet time.
• Shock therapy also meant big changes in how these countries traded with others.
• It also meant breaking up the old trade groups among the Soviet countries.

Conclusion

The transition from authoritarian socialism to democratic capitalism in post-communist regimes, influenced by organizations like the World Bank and the IMF, was termed “Shock Therapy.” This rapid shift, prompted by the collapse of communism, involved a complete overhaul of economic and trading systems, emphasizing privatization and integration into global markets. While shock therapy aimed to spur economic growth, its consequences varied, highlighting the complex challenges of post-communist transitions and the importance of carefully managing such transformations in the future.

Shock Therapy in Post-Communist Regimes- FAQs

What is the post communist regime?

Post-communism is the period of political and economic transformation or transition in post-Soviet states and other formerly communist states located in Central-Eastern Europe and parts of Latin America, Africa, and Asia, in which new governments aimed to create free market-oriented capitalist economies.

What is shock therapy in post communist regimes?

Shock therapy is the belief that sudden and significant changes in a country’s economic policies can transform a state-run economy into a free-market economy. Shock therapy is used to improve living conditions, boost economic productivity, and boost employment rates.

What was shock therapy class 12 notes?

Countries by a painful process of transition from an authoritarian socialist system to. democratic capitalist system. The model of transition in Russia, Central Asia and east Europe that was influenced by the World Bank and the IMF came to be known as ‘Shock Therapy’.