Growth decomposition in the socialist Czech economy

Abstract

Economic growth in centrally planned economies was declining with the duration of these economic systems. There were multiple reasons for this development. Deeper insight can be provided by dividing economic growth into extensive and intensive parts. The goal of this article is to estimate the share of extensive and intensive aspects of economic growth in the socialist Czech economy in the last two decades of the socialist era (1970-1989). We conclude that the extensive growth in this period stood for approximately 55% of the overall growth. This figure is broadly twice higher than comparative numbers for the post-communist period.