The transition crisis in Bulgaria

In 1996-97, while making its way through a difficult process of economic and political transformations, Bulgaria was hit by a severe economic crisis. This paper seeks to reveal and analyse the underlying factors and causes of this crisis. It focuses on empirical issues but also highlights some basic causalities and interrelations between economic variables during the crisis as well as the role of economic policy. The economic turmoil in Bulgaria is addressed from three different perspectives: (1) the historic roots of the crisis; (2) the actual evolution of the fiscal, banking and currency crises, and (3) the political economy of the transition in Bulgaria.