Contents -- Foreword -- Acknowledgments -- Abbreviations and Glossary -- Overview -- Innovation -- Inclusion -- Integration -- The Demographic Transition -- 1 The Elements of Economic Growth -- PART I: INNOVATION -- 2 Labor Productivity -- Manufacturing -- Competition and Net Entry -- Agriculture -- Services -- 3 The Business Environment -- Competition and Market Structure -- Finance and the Structure of Lending -- Restructuring in Firms -- What Determined Restructuring? -- PART II: INCLUSION -- 4 The Evolution of Employment -- Entry, Exit, and Employment -- Labor Market Outcomes: Converging? -- Shortages of Skills -- 5 Poverty -- Profile of the Poor -- Wages, Employment, and Distribution -- Public Transfers -- Caveats -- Well-Being in Transition -- PART III: INTEGRATION -- 6 International Trade -- Direction of Trade -- Factor Composition of Trade -- Buyer-Driven and Producer-Driven Networks -- Transition Countries: "Normally" Integrated? -- Patent Citations, International Co-Invention and Multinational Sponsorship of Local Invention -- 7 International Migration -- Determinants of Migration -- Migration Agreements -- PART IV: THE THIRD TRANSITION -- 8 Demographic Change -- Productivity -- Participation -- Savings -- Pensions -- Health -- A Policy Package -- The Role of Migration -- Appendix: Decomposing Productivity Growth -- References -- Index -- Box 1.1 Country Groups -- Figure 1 Firm Entry and Exit Contribute More to Productivity Growth in Transition Economies than in Industrial and Developing Economies -- Figure 2 The Structure of Finance for Fixed Investment Is Maturing but Has Not Converged to That in Developed Economies -- Figure 3 The Structure of Finance for Fixed Investment in Private Firms in Transition Economies Differs from Developed Market Economies, 2005.

Figure 4 The Difference in Structures of Finance between Private Firms in Transition Economies and Market Economies Is Due to Autonomous Factors -- Figure 5 The Structure of Finance for Fixed Investment Is Similar in Privatized and De Novo Firms, 2005 -- Figure 6 Structure of Finance for De Novo Firms, 1999 and 2005 -- Figure 7 De Novo Firms Have Been a Strong Force for Job Creation -- Figure 8 The Majority of the Poor Are Working Adults and Children -- Figure 9 Foreign Direct Investment Helps EU New Member States Take Part in Producer-Driven Global Networks -- Figure 10 Migration in Southern Europe Evolved in a "Hump"Pattern -- Figure 11 Populations in Many Transition Countries Are Shrinking -- Figure 12 Some Net Senders of Migrants Will Become Net Receivers -- Figure 1.1 Average Annual Growth Rate in GDP per Capita and Its Components, 1998-2006 -- Figure 1.2 Employment Rates: Early Transition, 1998 and 2006 -- Figure 2.1 Sectoral Shares of Total Value Added -- Figure 2.2 Benchmarking Sectoral Employment in Eastern Europe and the CIS-Evolution over the Transition and Compared with Market Economy Benchmarks -- Figure 2.3 Sources of Productivity Growth in Developed, Transition, and Developing Economies -- Figure 2.4 Contributions of Firm Entry and Exit to Productivity Growth -- Figure 2.5 New Firm Labor Productivity -- Figure 2.6 Survival Rates -- Figure 2.7 Sources of Productivity Growth, Selected Countries -- Figure 2.8 Incumbent Productivity Growth and the Contribution of Net Entry -- Figure 2.9 Incumbent Productivity Growth and the Contribution of Net Entry -- Figure 2.10 Sectoral Wage Employment for the Poor and Nonpoor, Selected Countries -- Figure 2.11 Sectoral Value Added per Worker -- Figure 2.12 Factor Intensity and the Growth of Household Farms -- Figure 3.1 Financial Constraints -- Figure 3.2 Regional Differences in Access to Finance.

Figure 3.3 Evolution of Financing for Fixed Investment -- Figure 3.4 The Structure of Finance for Fixed Investment in Private Firms in Transition Economies and Developed Market Economies, 2005 -- Figure 3.5 Decomposition of Difference in the Structure of Financing for Fixed Investment between Transition Economies and Developed Market Economies -- Figure 3.6 The Structure of Finance for Privatized and De Novo Firms, 2005 -- Figure 3.7 The Structure of Finance for De Novo Firms, 1999 and 2005 -- Figure 4.1 Large Job Flows in Transition Economies -- Figure 4.2 Job Creation and Job Destruction in Manufacturing and Services -- Figure 4.3 Job Creation and Job Destruction, by Country Group -- Figure 4.4 Job Creation and Job Destruction in the Transition Economies, by Ownership -- Figure 4.5 Size Distribution of Firms in 2004-05 -- Figure 4.6 Evolution of Size Distribution of Firms in EU8 Countries -- Figure 4.7 Evolution of Firm Size Distribution in Poorer Transition Economies -- Figure 5.1 Poverty in Transition Countries, 1998/99-2005/06 -- Figure 5.2 Composition of Poor Population, Selected Transition Countries: 2005/2006 -- Figure 5.3 Wage Increases and Productivity Gains during the Economic Recovery -- Figure 5.4 Real Wage Gains in Southeastern Europe and the CIS -- Figure 5.5 Real Wage and Net Employment Growth in Transition Countries, 1997-2005 -- Figure 5.6 Changes in Employment Rate, 1998-2005/06, Selected Transition Countries -- Figure 5.7 Coverage of Social Protection by Country Groups, around 2003 -- Figure 6.1 Merchandise Trade Openness as Percentage of GDP, in Purchasing Power Parities -- Figure 6.2 Services Trade Openness as Percentage of GDP, in Purchasing Power Parities -- Figure 6.3 Global Distribution of Merchandise Exports from the Transition Countries -- Figure 6.4 Intraregional Distribution of Merchandise Exports.

Figure 6.5 Factor Intensity of Merchandise Exports -- Figure 6.6 FDI Stock per Capita and Share of Skilled-Labor and Capital-Intensive Exports in 2006 -- Figure 7.1 Remittances as a Share of GDP in Transition Countries -- Figure 7.2 Postwar Emigration from Southern Europe, 1960-1988 -- Figure 8.1 Population Change in Europe and Central Asia, 2000-25 -- Figure 8.2 Working Age Population to Total Population, 1950-2025 -- Figure 8.3 Labor Force Participation in the EU15 and Transition Country Groups for People Ages 55-64, by Gender, 2006 -- Figure 8.4 Change in Labor Force Participation Rates Required to Maintain the Share of the Labor Force in Total Population in 2025 at 2000 Levels -- Figure 8.5 Migration and Demography-Policy Implications -- Table 3.1 Market Structure-Number of Competitors -- Table 3.2 Price Elasticity of Demand -- Table 3.3 Importance of Foreign Competition -- Table 3.4 Pressure from Foreign Competitors -- Table 3.5 Pressure from Domestic Competitors -- Table 3.6 Pressure from Customers -- Table 3.7 Sources of Financing, 2004-05 -- Table 3.8 Evolution of Financing, 1999-2005 -- Table 3.9 Deep Restructuring, 1999-2005 -- Table 4.1 Job Reallocation, Job Creation, Job Destruction, and Job Growth, by Country Group -- Table 4.2 Job Reallocation, Job Creation, Job Destruction, and Job Growth in the Transition Economies, by Ownership -- Table 5.1 Poverty Profile by Sector and Type of Employment of the Household Head, Selected Transition Countries, 2005/06.