The real state of the Czechoslovak economy before transformation

The major object of this work is to analyze conditions of the Czechoslovakia economy before the transformation process. Topic is actual thanks to a consideration of the real conditions of economy against generally accepted thesis about longtime unsustainability of that state. The work is focused on exploration of chosen indicators of the economy development through an analysis of original sources. The work is divided into two parts, theoretical and practical. The theoretical part shows conditions, which are need for socialism function and it gives in context the Czechoslovakia economy in 1970s and first half of 1980s. The practical part interprets an analysis of the period 1986–1989. The work puts great emphasis not only to analyze the indicators, but also to the political changes and direction of socialism here throughout reforms, which were planned for this period and should represent essential changes within the economy. The main target of this work is to verify the hypothesis that the Czechoslovakia economy was at the limit of its life. This hypothesis was not unambiguously proved. This conclusion is supported not only by the research, but also by number of authors’ opinions and arguments. Nevertheless, the research has shown, that central planning is not effective way to run economy, which malfunctions, when economy hit their borders by depletion of natural resources, measure of inputs or technological barriers. Although the Czechoslovakia economy showed significant signs of slowing and stagnating, revolution of the state system from socialist to capitalist was primarily caused by dissatisfaction of population with current state. Naturally, this was connected with inefficiency of central planned economy and satisfaction of basic human rights and needs.