The Russian Crisis (original) (raw)

Economic Crises in Post-Communist Russia

Economic Policy, 2015

Cri ses are an intrinsic background to the economic narrative of modern Russia, drawing experts toward a consensus on addressing them through a conservative fiscal policy that relies on a Reserve Fund and (Sovereign) Welfare Fund for insurance. For the quarter century of its post-Communist history, Russia has struggled with simultaneous crises and, as a result, its policymakers and analysts have sought to develop foresight about future instability. They have focused on mitigating crises that occurred asymmetrically in the business cycle, or due to external shocks; but such shocks and asymmetry, of course, make crises difficult to predict: as Queen Elizabeth II once asked during a briefing by academics at the London School of Economics on the global crisis in 2008, "Why did nobody notice it?" 1 From the 1930s to the end of the 1980s, Russian writers avoided the word "crisis" except in regard to "decaying capitalism," since censorship prevented them from using the concept in reference to the socialist regime. This does not mean that Soviet economists were unaware of the difficulties facing the communist economy. In the Soviet-era command economy, crises bore a hidden character and were referred to as "repressed inflation" or "forced savings," or a "trade deficit," in order to avoid openly using such terms as "inflation" that were used in regard to market economies; instead of "unemployment," Soviet economists referred to "surplus employment" and "low productivity." Experts did not discuss-or associate-these phenomena with crisis symptoms because the socialist system was not considered vulnerable to crises, even though there was a certain cyclicity to these phenomena in the Soviet era. 2 The oversight played a cruel trick on the Soviet system: the warning signs of the crisis that would bring the regime down were disguised as temporary phenomena. An early single-author version of this article was translated by Antonina Bouis. The authors acknowledge valuable comments by two anonymous readers and Anders Åslund.

Domesticating Russia's Economic Crisis

International Economic Bulletin, 2009

In a recent conference in Moscow, participants were asked to suggest policies that could get Russia out of its economic crisis. None of them, economists included, said much about the economy. The focus, rather, was on politics; Russia, they said, needs better institutions, freer courts and media, an empowered parliament with fair elections, and so on.

Economics and politics in Russia: On the eve of an acute crisis

Russian Journal of Economics, 2020

This article presents an analysis of the key challenges facing the global economy, as well as the impact of these challenges on Russia. It addresses main collisions that have emerged in recent years, including the proliferation of etatism and populism, increasing social and political polarization, the growing importance of national issues vs the global agenda, as well as the social, economic and political consequences of using digital technologies against the backdrop of the global economy spiraling into an unprecedented crisis. The pandemic and its global economic impact are analyzed within the context of the 2008–2009 global financial crisis. This is the foundation which we set for discussing Russia’s economic agenda.

Fifteen Years of Economic Reform in Russia

OECD Economics Department Working Papers, 2005

Fifteen years of economic reform in Russia: what has been achieved? What remains to be done? The paper provides an overview of the course of economic reform and the performance of the Russian economy since the early 1990s and an analysis of the structural reform challenges ahead. It assesses the contribution of institutional and structural reforms to economic performance over the period, before turning to the question of where further structural reforms could make the biggest contribution to improved performance. Three major conclusions emerge. First, there is still a great deal to be done to strengthen the basic institutions of the market economy. While the Russian authorities have embarked on some impressive-and often technically complex-'second-generation' reforms, many 'first-generation' reforms have yet to be completed. Secondly, the central challenges of Russia's second decade of reform are primarily concerned with reforming state institutions. Thirdly, the pursuit of reforms across a broad front could enable Russia to profit from complementarities that exist among various strands of reform.

The decline of the Russian economy. Effects of the non-reform agenda.

The objective of the article is to analyze the economic effects for Russia of pursuing political goals instead of reviving the economy and carrying out necessary reforms. The “non-reform agenda” since the mid-2000s means that for many years, the economy has been sliding due to structural problems and weak institutions. These tendencies were reinforced with the re-election of President Vladimir Putin for a third term in 2012 and his economic agenda. Since 2014 the additional problems of geopolitical tension, low oil prices and economic sanctions have resulted in the economy contracting. Despite the depressed economy the leadership keeps military expenditure at a high level. Import substitution as a means to mitigate the economic crisis is not convincing. Key words: Russia, economic decline, political versus economic goals, institutions, rent addiction, rent management, sanctions, import substitution.

Russia: Reform after the great recession

Russia has weathered the global crisis better than initially feared, in part due to its large anti-crisis package of measures. Russia is now likely to witness a robust but relatively jobless recovery from the Great Recession. But the crisis has brought to the fore the longstanding need to accelerate reforms to modernize public sector, strengthen financial sector, improve the investment climate, and advance diversification.

Russia's Struggle with Stabilization: Conceptual Issues and Evidence

The World Bank Economic Review, 1994

The most important question aburt Russian economic reform is bow to avoid a collapse of Russia's nascent demecracy in the face of highly wistable political and economic conditions. The precanous situation could ii nrauei i a spiral of self-reinmforcig destructive responses: criminadly, regronal sep tm, tax evasion, and flght from the currency. A combination of monetay tightening, an early pegging of the ecchange rate, and large-se international assistce to support stabilizaton offers Russia the most reaistc cance of avoiding politica catastrophe. International assistace to Russia during the past three years has bee iadequate in amount and without a proper conceptua framework The artice offers a strategy for Rusi stabilization and Western assistance based on theoretical and empical analysis. Te concerns raised aply not only to Russia, but more generally to weak stes in acute fiancial crisis, for which the current methods of delivering aid are typically too slow and too oblivious of the risks of state collapse. R ussia faces at least three fundamental economic challenges. The first is to overcome the state insolvency that is a legacy of the defunct Soviet regime. The second is to establish a market system on the ruins of central planning. The third is to manage the profound problem of structural adjustment, as workers and resources move from heavy industry to light industry and services. And it must manage these three enormous tasks while attempting to consolidate democracy and transform itself from empire to nation-state. Any one of these economic tasks would challenge a society's stability and forbearance. The combination of all three is historically unprecedented in scale and extent. It is not surprising, therefore, that Russia has lived perilously close to hyperinflation and social instability during the first three years of post-Soviet reform and adjustment. This article discusses the design of macroeconomic policies that are most appropriate in the face of Russia's extreme economic crisis.

Between Modernization and Stagnation: Russian Economic Policy and Global Crisis

SSRN Electronic Journal, 2013

The paper deals with the trends in the world and Russian economies towards development of a new post-crisis system, including technological and structural transformation. Three main scenarios of Russian economic development (conservative, innovation and acceleration) are discussed basing on historical analysis of Russian economic performance since 1970-s when oil boom started. On this basis key challenges of economic policy in 2013 are discussed.