Did the Fall of the Wall Hurt Growth?

A quarter-century since the fall of Berlin Wall, recent events in Ukraine are evidence enough that conflict between Russia and the West didn’t disappear with the end of the Cold War. But that isn’t the only way that the optimism of 1989 has been disappointed. The early 1990s were filled with hope that the economies of Eastern Europe and Central Asia would boom once they were freed from the shackles of state control. In fact, the economic performance of the former Eastern bloc has been pretty grim—for some countries, worse than under communism. That’s a lesson in the messiness of change, but it also highlights why economic growth is only a partial measure of progress.