In the early transition phase in post-communist Europe, citizens' perceptions of the national economy appeared more favorable than objective economic indicators would suggest. With triple and quadruple digit annual inflation rates and a severe economic contraction, there was a substantial portion of the population in these countries who still thought that the national economy had been and would be improving. Thus, sociotropic economic perceptions in the wake of the democratic transformation appeared to be disconnected from the real economic situation. The purpose of this paper is threefold. First, it explores the link between objective economic indicators and public evaluations of the economy. Second, it investigates the microfoundations of economic perceptions. And finally, it tests a well-established proposition that political sophisticates are more accurate in their perceptions than their less informed counterparts. The findings of the study can be generalized to any political and economic system undergoing transition.Keywords Economic perceptions Á Post-communist Á Transition Á Economic voting Á Information shortcuts Á Accountability One of the grounding postulates of democratic theory is the principle of accountability. The theoretical operation of the accountability mechanism is quite simple: elected officials bear responsibility for their performance and receive reward or punishment from their constituency accordingly in the form of re-election or denial of a future political mandate. In reference to economic accountability, the mechanism presumes government responsibility for the state of the national economy, also known as economic voting (Lewis-Beck 1988; Page and Shapiro