Includes bibliographical references (pages 189-208) and index.

In spite of problems since reunification Germany remains the most important economy in Western Europe, and is the lynchpin of European security. The East German states must be successfully integrated into the German economy if the country is to remain stable and play its full role within an expanded European Community. The failure of the leadership of the ruling Communist Party, the SED, to undertake a fundamental reform of the economic mechanism and to reshape social policy was a major determinant of the unexpectedly rapid collapse of the East German regime in late 1989. This volume traces the creation of a socialist socio-economic order in the late 1940s-early 1950s and its modification in the 1960s, before embarking on an examination on the Honecker regime's technocratic approach to the social and economic challenges inherent in the scientific-technical revolution. The book then focuses in detail on eastern Germany's painful transition to a social market economy and concludes on an analysis of the cleavages still separating the two parts of Germany.

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