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This chapter lays out the historical background for the development of postcommunist card markets. It revisits theories of the transition, focusing on the three distinct development paths the economies of the eight countries took: the path taken by the Central European countries, which started with an economic recession but soon integrated into the European Union and the developed world; the path navigated by the economies of East Europe, which experienced more tumultuous and protracted transition and a slower European and global integration; and the path traveled by China and Vietnam, two fast-growing East Asian economies that started from an overall much lower level of economic development keeping a strong role of the Communist state in the economy. The chapter discusses the creation of commercial banks and emphasizes the similarities among the countries’ developmental paths. It also criticizes the market transition theories for ignoring the demand side of market building.

The conclusion highlights the common problems that market makers in all of the countries faced, but it also emphasizes the differential successes and sometimes different paths and sequences of events that accompanied the development of card markets in the eight countries. It also notes that in several of the countries, most unambiguously in China, the central purpose of the card market shifted from providing a tool of convenience to customers to offering an instrument of economic control for the state. The discussion then turns to theoretical issues of social order and market emergence, and emphasized the implications of this analysis for the study of globalization, postcommunist transitions and markets

This chapter establishes market emergence as a problem analytically distinct from market functioning and introduces two sets of rules: generative and functional. Credit cards are conceived of as global products that are both a means of payment and an instrument of credit. Frequent references to the US credit card market are justified by its role as a performative ideal type--a model that not only helps to explicitly describe postcommunist credit card markets but also attempts to shape them by imposing a set of implicit instructions. The chapter provides the basic statistics of payment card markets in the eight postcommunist countries and concludes with an overview of the remaining chapters.

The aim of macroeconomic stabilization is restoring price stability and reducing monetary, fiscal, and balance-of-payment imbalances. Macroeconomic stabilization is particularly needed when a country suffers from high inflation or hyperinflation. To stop such an inflation one can choose between three types of anti-inflationary programmes: orthodox money-based, orthodox exchange rate-based, and heterodox. Other cases of macrostabilization policy include reducing excessive fiscal deficit and public debt before they become monetized, dealing with the deflationary consequences of the systemic banking crisis, reducing the excessive current account deficit, dealing with the consequences of a sudden stop in capital flows, and fighting chronic moderate inflation. Fiscal rules, and the independence of monetary and fiscal institutions such as central banks, play an important role in preventing macroeconomic instability. National macroeconomic policies are also monitored from outside, for example by the International Monetary Fund and European Commission (in the case of EU member states).