2 SOCIAL SCIENTIST when choosing between the relative roles of 'plan' and 'market', the flexibility offered by the latter is of greater benefit than th^ costs associated with atomistic decision-making and the fact that the nature of a market is defined by a set of structures that also predefine the distribution of economic benefits. The difficulties these factors create for proceeding with economic reform is highlighted by Jaya Mehta's article on the experience with Lieberman-type reforms in the GDR, which though moderate when compared to the current Soviet reforms, were in the same direction. They provided greater flexibility to the enterprises with regard to the composition of output, the average wage and the number of workers employed and allowed a significant part of the material balance in the system to be ensured through inter-enterprise trade. However, with the price structure left in the hands of the government, price adjustments failed to materialise at a pace required by an economy like that of the GDR's, which though small was extremely diversified. Partial decentralisation, it appeared, was an inadequate substitute for central planning. The Soviet reforms are attempting to meet this problem with provision for enterprise level price-fixation, combined with a degree of exposure to international competition. Sensing the dangers inherent in such a process in an unequal world, the GDR opted for a return to quantitative planning, accompanied by reorganisation of production units into vertical and horizontal combines aimed at internalising within a single decision-making unit the supply of raw materials, R&D investment and promotion of external trade in the area concerned. Flexibility was sought to be achieved by reducing the range of supplies, prices and performance criteria imposed from outside. Unlike the GDR, Hungary chose to proceed further in the direction of decentralisation through the market with the introduction of the New Economic Mechanism in 1968. In his article K.K. Dasgupta shows that such decentralisation has as its corollary, the dilution of planning in the sense of provision of precise targets for output and investment and the setting of administered prices. The fall-out is not merely greater flexibility, but inflation, unemployment and a much higher degree of inequality. To boot, if liberalism touches external trade policy as well, the transition to a more decentralised regime is accompanied by a huge build-up in debt. The evidence so far seems to suggest that the induction of flexibility through a liberal, 'market-based' regime, involves costs that are both substantial as well as borne unequally by different sections of the population. In an accompanying article, Venkatesh Athreya looks at the impact of the new thinking in the Soviet Union on perspectives regarding neocolonial exploitation and the inequalising tendencies inherent in the capitalist world system. Finally, Vivek Debroy focuses on population and fertility trends in Eastern Europe and the challenges they imply in terms of the need for technical change and constraints to agricultural development.