Case | HBS Case Collection | June 2013 (Revised March 2016)

Estonia: Transition, EU Membership, and the Euro

by Michael E. Porter, Christian Ketels and Örjan Sölvell

Abstract

The case discusses the economic development of Estonia, covering specifically the period from regaining independence from the Soviet Union in 1991 until 2015. It tracks the process from the initial transition towards a market economy to becoming an EU member country, including the 2007 crisis and the government’s response to it. The overall performance of the economy, the profile of its key clusters, and the quality of its business environment in 2015 are discussed. The case provides the background for an analysis of policy reforms in a transition economy, the role of legacy and geographical neighborhood for economic development, the implications of EU membership for a EU member country, and the relationship between microeconomic reforms and macroeconomic crisis.

Keywords: Economy; Macroeconomics; Microeconomics; Policy; Government and Politics; Organizational Change and Adaptation; Strategy; Estonia;

Citation:

Porter, Michael E., Christian Ketels, and Örjan Sölvell. "Estonia: Transition, EU Membership, and the Euro." Harvard Business School Case 713-479, June 2013. (Revised March 2016.)