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Government-proposed mechanisms and strictly regulated activities prompted the shift from a centrally planned economy to a postsocialist system, which is viewed to be the major source of growth. Expansion in all aspects of the government and society leads to overall progress and improvement. While there are states that classify such circumstances as the main causes of social and political turmoil and instability, there are still nations that operate in the realization of the optimal potential of these methods. This statement only implicates that there is no such thing as the fall of communism, but open-mindedness toward the alternatives that pursue sound economic decisions, organizational harmony and coordination, price stability, effective and efficient governance, and excellent management of physical and human resources. These expected outcomes of market-driven reforms, though only to a limited amount, have yielded increased growth rates and global competence.

Socialism and the centrally planned economy could have been successful if the economic systems and its governing bodies had comprehensive development policies as well as adequate knowledge and strong determination toward restructuration. Absence of any of the two conditions deters the process of organisational reforms and changes in growth strategies. This chapter contextualises these concepts and actions in China and Vietnam as compared to that of the Eastern European countries and the former Soviet republics. This is accomplished by examining the capacities and the abilities of each country in handling and balancing the two forces, the prevalence of the shifts to postsocialism in varying settings, the association of these modifications to the restoration of capitalism, and the possible backfires and benefits of the postsocialist regime.

Other free trade areas and customs unions have been less intensively studied than the EU or NAFTA. RTAs among developing countries have not had a great impact, often because paper agreements were not fully implemented, or where they have had an impact they have not survived, sometimes because they involved trade diversion that turned out to be costly for some members. Section 2 deals with RTAs among centrally planned economies.

The socialist experiment of the twentieth century in these two countries was a reaction to the inequalities and social tensions created by the preceding Westernization. It led to a decrease in wealth and income inequalities, in crime rates, and in the shadow economy. But the centrally planned economy could only work efficiently for 20–30 years—this may have been enough to restore collectivist institutions in China, but not in Russia. In Russia, creeping dismantling of community institutions had been going on since at least the seventeenth century; in China—only from the Opium Wars of the mid nineteenth century. What was a passing episode and deviation from the trend in Russia was a return to mainstream development and restoration of a long-term trend in China. Hence, economic liberalization from 1979 onwards in China, even though accompanied by growing income inequality, did not result—at least until today—in institutional collapse; in Russia the institutional capacity of the state fell dramatically.

This chapter provides a short historical overview. It shows that there are limits to the expansion of the market system. Sometimes the dynamics of the system seem unstoppable, particularly because it generates material wealth as no other system can, but it repeatedly stumbles on limits and falls victim to its own success. At that moment governments step in, and political management and control become important again. Over time, however, government management systems also reach their limits. It is as if market and government are locked in a perpetual battle, attempting to win ground from one another, overthrowing the other again and again.