Height and well-being during the transition from plan to market

Abstract

SUMMARY Kleine-Rueschkamp, and Elena Nikolova?>Using newly available data, we re-evaluate the impact of transition from plan to market in former communist countries on objective and subjective well-being. We find clear evidence of the high social cost of early transition reforms: cohorts born around the start of transition are about 1 cm shorter than their older or younger peers. We provide suggestive evidence on the importance on mechanisms that partially explain these results: the decline of GDP per capita and the deterioration of healthcare systems. On the bright side, we find that cohorts that experienced transition in their infancy are now better educated and more satisfied with their lives than their counterparts. Taken together, our results imply that the transition process has been a traumatic experience, but that its negative impact has largely been overcome.