Market liberalization in Zimbabwe: the case of subsidies, 1980- 1987

Abstract

The foundations of the current Zimbabwean economy were, to a great extent, laid in the 15 years following the Unilateral Declaration of Independence (1965 to 1980). During this period, there was considerable industrial development and diversification of the economy, both between sectors and within sectors. For example, the virtual monocrop orientation of commercial farming before UDI was reduced with the value of tobacco marketed falling from around 70% of marketed crops in 1965 to about 30% in 1980. These changes took place in an economy with both a high degree of protection through sanctions and a high degree of state intervention and regulation. In many ways, it was a textbook example of the dirigiste economy against which the currently fashionable arguments for liberalization are directed.