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Price Reform and Price Setting in the Transition to Market Economy
 
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In the years of the country's development as a socialist state and COMECON member the subject of prices and pricing used to be taboo for Bulgarian economists. Both the price reforms and the changes in the prices of specific articles were carried out under strictest secrecy. The decisions for changes in prices and price policy were made by the top hierarchy of the ruling Communist Party. For the period up to 1990 there is no available objective information on price levels and dynamics. The state authorities claimed (just like in the other socialist countries) that the economy was developing under zero inflation, which was pointed out as one of the advantages of planned over market economy.

The analysis of the actual processes developing in the Bulgarian economy, however, reveals quite different tendencies. At the end of the 80s, over 95 per cent of retail prices were centrally fixed by the Committee on Prices as dictated by the Central Committee of the Communist Party and the Government. The prices of an insignificant part of goods and services - specific to a given region - were determined by special price-control authorities on local government level. The prices in all restaurants and entertainment establishments across the country, including the tourist resorts, were equally under state control.
 
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