A Marshall Plan for the East: Options for 1993

The economic crisis in Eastern Europe and the former Soviet Union continues to evoke calls for Western assistance. Many observers question, however, whether a new Marshall Plan would be productive today. Answering this question requires first understanding what rendered Marshall aid so effective after World War II. This paper therefore reviews recent research on the effects of the Marshall Plan. It then considers four options for Western assistance to the East: a Marshall Plan on the scale of 1948-51, aid sufficient to fund a social safety net, aid sufficient to establish a multilateral clearing mechanism, and the provision of technical assistance