RobinsonCentrall - David Robinson Econ 508 Economic...

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David Robinson Econ 508 Economic Transition in Kazakhstan Since the fall of the Soviet Union many of the satellite countries and Russia itself have struggled to develop a solvent economy. A region that has been plagued with some of the worst economic conditions is the newly formed Republic of Kazakhstan. Although endowed with an abundance of natural resources, a well-educated public, and pre- existing industry, Kazakhstan has made very few economic developments. Previous to its independence, many economists felt the economies of Kazakhstan could be transformed within a very short period of time. As the transition to a market economy took place it became increasingly apparent that Kazakhstan required more than the generic therapy prescribed by economists in other countries around the world. In order to understand and correct the economic problems in Central Asia it is important to look deeper into the background and the currents situation happening in this region. Before the twentieth century Central Asia was ruled by a varying group of rulers. In 470 AD Kazakhstan was invaded by the Huns, their control of Kazakhstan lasted for almost two centuries. In 651 AD Turkish Arabs began capturing cities in Central Asia. Although lacking a strong central government, these nomadic Arabs managed to fight off an invasion from China in 751 AD. During the eighteenth century the Russian Empire had already taken control of northern Kazakhstan. With the help of Great Britain during the nineteenth century Russia had successfully developed a border between Central Asia and Afghanistan. After this border was created Russia subsequently began dividing the region into the countries we know Central Asia as today. Because of linguistic and cultural reasons it would have been very unlikely that these states would have ever been grouped and divided in these categories without this Russian influence. Economic reform was the next agenda Russia had for Central Asia. Russia quickly began to develop a market for Russian goods. At the same time railroads were created for the
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purpose of exporting cotton to Russia and other parts of Asia. As economic conditions were improved many Russian citizens began migrating to northern cities in Kazakhstan. After the Soviets took control of Kazakhstan in 1920 many changes were made to the existing culture and economy in Kazakhstan. On a microeconomic scale all property rights were taken from the Kazakhs and the market economy was put to an end. Soviet Russia had a need for agricultural products and saw Kazakhstan as a future major producer of grain and cotton. Because Kazakhstan was such an agriculturally based area it was decided by the Soviets to quickly gather the agricultural surplus through collective farming. The change to collective farming was so abrasive to the public it led to starvation and migration for thousands of citizens in Kazakhstan. Although many records from this time period are unwritten or unavailable it is safe to acknowledge the cost of
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This note was uploaded on 07/17/2008 for the course ECON 508 taught by Professor Fleisher during the Winter '06 term at Ohio State.

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RobinsonCentrall - David Robinson Econ 508 Economic...

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