Institutional equilibrium and economic performance:: The case of Ukraine

Since independence, Ukraine's economy has gone through a deep depression followed by spectacular growth since 1999. After a 50% decline, industrial output bounced back in 2006 to its 1990 level. This upturn has taken place without any major institutional change, the rule of law still being as absent as during earlier periods. Growth resumed apparently thanks to classical economic reforms, conducted in line with the Washington consensus and after much hesitation. This case shows that growth is compatible with a "bad institutional equilibrium."