Transition as Development

Russia has been negotiating for accession to the WTO for some ten years, and there is still no prospect of an immediate conclusion to the process. The reasons for this are partly to be found in the international environment. In the past, the geo‐strategic concerns of the Western powers have created barriers to Russian integration into global trading structures. Even in the new, post‐September 11 environment, existing WTO members have continued to use the WTO accession process as a way of advancing their own commercial policies vis‐à‐vis Russia. But the main obstacles to speedy accession have been internal. While the Russian government as a whole is strongly in favour of WTO accession as a way of strengthening the market mechanism and reform processes within the country, significant elements within it are equally strongly in favour of high levels of protection for specific sectors, on national security and/or technological/infant industry grounds. While the Russian business community as a whole is divided over the merits of accession, the powerful manufacturing and banking lobbies are demanding levels of protection that would almost certainly be incompatible with accession. Russian views of WTO accession vary widely, within both government and the business community, and anyone who would lobby in favour of accession within Russia must bear this firmly in mind.     

The informal economy and the growth of small enterprises in Russia1

This article uses Russian regional data to estimate the determinants of the informal economy and to examine the relationship between the informal economy and the growth of legally registered small private enterprises during the transition period. After obtaining an estimate of the size of the informal economy in each Russian region from 1992 to 1999, an analysis is performed to find whether reform progress and institutional qualities account for the informal economy. An evaluation of the links between the informal economy and the growth of small enterprises within Russia is then carried out. The findings suggest that Russia's informal economy resulted from a delay in reform and low qualities of institutions. It was found that the growth of small enterprises is positively affected by the informal economy. These results imply that the informal economy helped entrepreneurial activities to grow in the face of government failure, but these informal activities tend to become official over time.     

The governance mechanism of Russian firms: its self-enforcing nature and limitations

The legal form of business enterprises in contemporary Russia is diversified to almost the same extent as those in major advanced countries. Joint-stock companies are now the most common form of incorporation among leading industrial enterprises. The law on joint-stock companies in Russia provides for the governance mechanism of joint-stock companies, in order to implement the concept of a ‘self-enforcing’ organisation in which the legal code of business management should be observed voluntarily by managers and large stockholders. This fundamental idea is embodied in many aspects of the current system, including the mechanism of management and supervision characterised as ‘diarchial leadership’, the balance of power between stockholders and corporate officers, and the internal audit system. However, the self-enforcing nature of the Russian enterprise has been undermined by a number of factors, including the overwhelming expansion of closed joint-stock companies, the predominance of insider ownership, the short history of internal auditing and the lack of legal enforcement power. As a result, breaches of company law are rampant in Russia today. This raises serious problems for the Russian corporate system, along with the legal peculiarity of privatised firms and people's enterprises, which complicates the system of joint-stock companies and deprives it of transparency.     

对经贸俄语人才培养的几点思考

21世纪,中俄友好关系不断加强,中俄贸易迅速发展,对经贸俄语人才的需求也在增加,中国俄语经贸人才培养正面临着发展与挑战。经贸俄语人才培养的最终目的是为国家间的经济往来服务,而俄贸易迅速发展的新形势要求大量的经贸俄语人才。当前,国内高校俄语专业重点发展语言文学而忽视经贸俄语人才的培养,一定程度上造成了经贸俄语翻译人才的缺失。高校俄语人才培养应注重社会的需求。     

Defence and Promotion of Desired State Identity in Russia’s Strategic Narrative

This article examines how the Russian state promotes and protects its preferred self-identity, using the conceptual framework of ‘strategic narrative’. Nation branding practices, including state-funded ‘mega-projects’ like the Sochi Olympics, have contributed to the narrative by characterising Russia as a welcoming, attractive destination. However, a more salient feature of Russia’s strategic narrative is intense ‘anti-Western’ and ‘anti-American’ political and media discourse, formulated to defend against rival, threatening narratives projected from other countries. Through analysis of official statements and state television content, this article demonstrates how determination to protect ‘great power’ and ‘European’ identities underlay Russia’s strategic narrative in 2014. It considers responses which the narrative has prompted, arguing that desired results in domestic reception have been achieved at the expense of unsatisfactory results internationally. Heavy-handed attacks on the identities of other states boost collective self-esteem among Russian citizens, but they fail to produce – and arguably obstruct – desired responses among foreign audiences.     

Foreign direct investment,political risk and the limited access order

The common explanations for political risk in foreign investment focus on the opportunism of host-country governments. However, when governments are too weak to regulate and effectively control them, domestic business elites may also cause political risk. In the literature on political risk, the host state is mostly modelled as a single, cohesive actor and elites outside of the government are not taken into account. By contrast, this paper conceptualises political risk as a lack of government assertiveness vis-à-vis domestic business elites, drawing on the limited access order (LAO) concept developed by Douglass North and his co-authors. It presents the case of Swedish Tele2’s investment in Russia. The mobile telecommunications provider was highly successful in Russia until it became a threat to the business interests of three Russian oligarchs. Regulatory agencies in Russia lacked the necessary authority to provide a level playing field in the telecommunications industry. They did not intervene when Tele2’s access to vital licenses was blocked by competitors, effectively squeezing the Swedes out of the Russian market. This paper concludes that in LAOs foreign investors are initially welcome, but political risk is high when the market competition with domestic elites becomes intense.     

Russian Business Interests and the Enlarged European Union

The European Union is Russia's most important partner in foreign economic activities. With its eastward enlargement in 2004 the European Union has—not only in geographical terms—moved even closer to Russia. It should be expected that strong economic ties cause Russian business interests to influence related matters of foreign policy. This study therefore starts by identifying Russian business interests vis-a-vis the EU. Apart from those businesses already heavily involved in transactions with the EU, businesses with ambitious plans for future engagement and businesses which face heavy competition from EU companies are also included. In a second step these business interests are then analysed in detail. The specific interests of Russian companies are depicted to establish the points of conflict with EU positions. The article then describes how Russian companies lobby their government in order to gain support and how the Russian government reacts. The result is a more detailed assessment of the role of Russian business in Russia's policy towards the EU.     

The Impact of Liberalizing Barriers to Foreign Direct Investment in Services: The Case of Russian Accession to the World Trade Organization

In this paper a computable general equilibrium model of the Russian economy is used to assess the impact of accession to the World Trade Organization (WTO), which encompasses improved market access, Russian tariff reduction, and reduction of barriers against multinational service providers. It is assumed that foreign direct investment in business services is necessary for multinationals to compete well with Russian business services providers, but cross‐border service provision is also present. The model incorporates productivity effects in both goods and services markets endogenously, through a Dixit–Stiglitz framework. It is estimated that Russia will gain about 7.2% of the value of Russian consumption in the medium term from WTO accession and up to 24% in the long run. It is also estimated that the largest gains to Russia will derive from liberalization of barriers against multinational service providers. Piecemeal and systematic sensitivity analysis shows that the results are robust.     

俄罗斯对华直接投资的贸易效应研究

俄罗斯一直是我国重要的贸易伙伴国,双边贸易潜力巨大,双向投资日趋活跃,中俄两国经贸关系不断深化。中俄双边投资规模和质量的快速提高,对中俄贸易的发展起到了积极的影响作用。通过分析俄罗斯对华直接投资对中俄贸易所产生的效应,能够更好地促进中俄经贸合作战略升级。本文从贸易与投资规模的角度,选取1992—2008年的中国对俄出口贸易额和对俄进口贸易额作为被解释变量,俄罗斯对华直接投资流量和存量作为解释变量,设立了多元回归分析模型,用以考察俄罗斯对华直接投资对中俄进出口贸易的短期和中长期影响。结果表明：俄罗斯对华直接投资流量对中国对俄出口贸易影响不显著,俄罗斯对华直接投资存量与中国对俄出口贸易之间存在互补效应,俄罗斯对华直接投资流量与中国对俄进口贸易之间存在互补效应,俄罗斯对华直接投资存量与中国对俄进口贸易之间存在替代效应。     

Forest certification in Russia: Challenges of institutional development

This article examines the implementation of voluntary forest certification in Russia and the role it has played so far as a mechanism of multi-level governance with the potential to create sustainable forestry. The evidence was gathered from a data-set of over a hundred in-depth interviews with individuals from business, communities, state and non-governmental organizations in several major forestry regions in the European and Far-Eastern parts of Russia. The respondents' views regarding the nature and effects of certification were wide ranging. Certification is associated with new and powerful tools that are an alternative to coercive state governance, which may become instrumental in ensuring law enforcement and sustainability. At the same time, the combination of commercial drivers behind certification and the lack of social controls may lead to the institutionalization of existing, not necessarily desirable, forestry practices. Our paper shows that the inconsistent outcomes of certification are highly related to path-dependent social institutions and local practices. The expectations for internationally-devised schemes aimed at establishing sustainable forest management can be easily thwarted by the behavior of individuals involved at the local level. Greater focus on low-level actors is required for effective realization of multi-level governance in Russian forestry.     

CPI bias and real living standards in Russia during the transition

The economies of the former Soviet Bloc experienced large declines in output during the decade of transition which began with the collapse of the Soviet Union in 1991. Yet there are many reasons to believe that measured output and official deflators provide a poor proxy for the change in real living standards in transition economies. This paper uses the Engel curve methodology developed by Hamilton [Hamilton, B. 2001. “Using Engel's Law to Estimate CPI Bias” American Economic Review 91(3): 619–630] to examine changes in real living standards in Russia during the transition period and to provide an estimate of how much the official Russian CPI has overstated consumer inflation. We also examine changes in consumer durables, home production, and subjective well-being to further evaluate changes in living standards. Our findings indicate that CPI bias has caused a substantial understatement of the growth performance of the Russian economy during the transition. Even just allowing household final consumption to be deflated with bias, we find that the level of real per capita GDP in 2001 may be understated by up to 30% compared with using a bias-corrected deflator. Our analysis of consumer durables, home production, and subjective well-being supports the conclusion that the decline in living standards has been substantially less than what is inferred by looking at official statistics on real output.     

Evolution of corporate governance in Russia: government policy vs. real incentives of economic agents

This article is devoted to analysing the evolution of corporate governance mechanisms in Russia. Special attention is paid to the causes of dramatic discrepancies between the expected outputs of institutional reforms implemented by the Russian government with World Bank and IMF support and the actual behaviour of Russian companies. Why was the model of interaction between enterprises and investors, owners and managers, which had been successful in other countries, rejected by Russian business in the 1990s? And how can we evaluate certain positive changes that have occurred recently in corporate policies of major Russian companies? These questions are answered on the bases of analysis of economic agents' motivation at different stages of development of corporate structures in Russia. The article argues that the need for comprehensive organisational and technological restructuring of enterprises led to the need for a concentrated ownership structure. The formation of such a structure in the late 1990s (which occurred, in fact, contrary to the government's activities) created preconditions for extending the time horizon of dominant owners and managers and for positive qualitative changes in the relations between major Russian companies and their shareholders and investors.     

On the Geopolitical Discourses of the Russian Yabloko Association, 1993-2001

This article draws attention to the competitive and changing nature of the discursive field of Russian geopolitics. In particular, the article focuses on the geopolitical discourses of the Yabloko Association (from 2001 the Democratic Party of Russia, Yabloko). In the discursive study of geopolitics, which is well developed in the critical geopolitics literature, the study of the geopolitical discourses of political parties has so far been neglected. Five major discourses by Yabloko are identified (1993-2001), with their significance and prominence varying according to changes in the broader geopolitical context. Yabloko's position is located within the general constellation defined by the extreme poles of Westernism (Atlanticism) and Eurasianism. Yabloko represents a third way between these extreme poles and can be situated within the new category of 'pragmatic Russian geopolitics'. Yabloko presents an interesting example of a Russian opposition party whose foreign policy thinking seems capable of both changing with the broader geopolitical context and contributing to the official Russian policy.     

俄罗斯国家身份转变及其对中俄关系的影响

国家身份是影响俄罗斯对外战略和中俄关系的重要因素。俄罗斯在国际社会的互动中，逐渐调整其国家身份：由世界性大国转变为地区性大国，由西方国家调整为欧亚国家。转变后的俄罗斯国家身份与中国的国家身份比较接近，这对中俄关系产生重大影响，使两国关系不断密切并走上良性发展的轨道。     

The effect of minimum wage on poverty

To the best of my knowledge, the minimum wage's influence on poverty in Russia has never been investigated. Russian data provide a unique opportunity for studying the effects of the minimum wage on poverty, given significant increases in the minimum wage in recent years, almost complete coverage, and a high representation of full-time workers in poor households. This article examines the effect of the minimum wage on the incidence of poverty and the transitions into and out of poverty in Russia using data from the Russia Longitudinal Monitoring Survey of Higher School of Economics (RLMS-HSE) from 2006 to 2011. The results indicate that the minimum wage in Russia had moderate poverty-reducing effects.     

Gerschenkron Revisited: The New Corporate Russia

Our analysis is based on firm-specific data compiled from the Russian Trading System stock exchange and SKRIN (CKPиH in Russian) database. We seek to identify the factors behind Russia’s dramatically improved corporate sector performance from the beginning of the 2000s to December 2007. We argue that improved long-term corporate performance was a consequence of several policy initiatives associated with the state-dominated banking sector, which enabled statesubsidized investment funds to be channeled from a structurally reengineered energy sector to targeted investment projects located in other industries. We claim that Russia’s industrial strategy closely conforms to Alexander Gerschenkron’s catch-up theory.     

Russia’s food self-sufficiency and food security: an assessment

The article differentiates between self-sufficiency and food security. The impact of Russia’s 2014 food embargo on the food system and food trade is analysed. Domestic production has increased and Russia has become more self-sufficient in food and seafood. In addition, food trading partners have changed. Western food and seafood trading partners have been replaced by trading partners from Asia and Central Asia. There is a high likelihood that the Russian food market has been lost to Western exporters for the foreseeable future. Even after sanctions and countersanctions end, it is difficult to see the pathway for Western food exporters to recapture market share in Russia.     

Can Russia Resettle the Far East?

Russian scholars, politicians and media have been alarmed by the declining population of the Far East, seeing it as a step towards eventual takeover of the region by China. This article shows that the progressive depopulation of the Far East is a reality and will continue in the coming decades. In addition to natural decline, the Far Eastern population will shrink faster than that of Russia because of net outmigration. Economic stagnation will keep migration from the South of the region at its present low rates. Recovery will increase mobility and allow the present deferred migrants to leave for European Russia. In the unlikely event that the Far East outperforms the rest of the country economically, it will attract migrants. However, any inflow is likely to be small because of the shrinking populations in European Russia and other ex-Soviet republics, and the competition for migrants from other parts of the world.     

俄罗斯发布信息技术产业发展路线图

信息技术是俄罗斯新时期实现经济现代化和创新发展的五大优先方向之一。为进一步推动信息技术产业的发展,俄罗斯政府制定并发布了《信息技术产业发展路线图》。该路线图在评析俄罗斯信息技术产业发展现状的基础上,提出了2013-2018年俄罗斯政府发展信息技术产业的主要目标、重点任务及具体实施措施,其重点任务是:加强人才培养、改善商业环境、扩大研究、完善基础设施、推动国际合作。俄罗斯信息技术产业发展路线图对我国发展信息技术产业具有一定的借鉴意义。     

Privatisation and Crime

Abstract
While criminalisation of the Russian economy can partly be explained by privatisation in conditions of underdevelopment of free market institutions, the emphasis on privatisation as the prime cause of crime may lead to gross oversimplification. The present article claims that faster and more radical, rather than slower and partial, privatisation could create less room for criminal behaviour in Russia. Half-measures applied to privatise the Russian economy have contributed to prolonged uncertainty and to a blurred demarcation between the private and government sectors as well as between management and ownership in business enterprises. Prolonged coexistence of the two sectors creates too much opportunity for criminal behaviour. Moreover, an explanation of the growth in crime in Russia is impossible without analysing the legacies of the former communist system, the developments in politics (including demoralisation of the ex-communist state apparatus), cultural factors and the specific features of the privatisation as actually conducted .