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Regular version of the site
2018/2019

Political Economy of Postcommunist Transformation

Mode of studies: offline
Instructors: Andrey N. Scherbak
Language: English
ECTS credits: 4
Contact hours: 36

Course Syllabus

Abstract

This course explores the complex relations between political and economic transition in Russia and other post-communist countries in the last 40 years. In the 1980s, communist political leaders realized that the command system could no longer provide economic growth. Their response to this challenge was to launch economic reforms that in turn had a significant impact on the political system. While in China economic opening and reform resulted in a period of prolonged economic growth, reforms in Russia led to a severe economic crisis with a 45% decrease in GDP between 1991 and 1998, before growth took off during the 2000s. Today, many post-communist countries stand again at a point where they have to re-think their underlying economic model. To understand where they are coming from, and where they might be headed, this course provides an in-depth discussion of the concept of economic growth in post-communist transition. What are the determinants of economic growth in both countries? What is the role played by politicians, economic advisors and business elites, the effect of shock therapy and gradualism, and the role of state institutions? How do privatization, corruption, the nature of state-business links and the availability of natural resources affect economic performance? After offering a short historical overview, we will discuss all of these topics in turn.
Learning Objectives

Learning Objectives

  • The goal is to explore the specifics of post-communist economic transition
Expected Learning Outcomes

Expected Learning Outcomes

  • Students critically interpret the main events and trends in post-communist transition
  • Students must retrieve, collect, process and analyze a wealth of information to prepare for the quizzes, individual assignments and final essay
Course Contents

Course Contents

  • Command Economy in the late Soviet period: from stagnation to crisis. The Perestroika
    A brief overview of the command economy in the USSR in the 1980-s: theory and reality. Shadow economy. The economic reasons for Perestroika.
  • The Gorbachev’s reforms: the failure to reform command economy
    Gorbachev’s economic reforms: plans, expectations and outcomes. Socialism with a ‘human face’ – myth or reality? The reasons for the failure of moderate reforms.
  • Market transition in Russian and beyond
    The Gaidar reforms: theory and reality. Shock therapy vs. gradualism. Political aspects of the reform: the Constitutional crisis. Gaidar’s achievements and his critics. Did this reform fail?
  • 5. The resource curse in Russia: pros and cons
    The resource curse theory and its’ application to Russia. The oil shock and economy growth. The Putin’s presidency. Is Russia a classic ‘petrostate’? The main ideas behind resource curse theory and its main critics. Russian oil industry in historical and comparative perspective.
  • Privatization in Russia
    The role of privatization in transition: political and economic aspects. Dilemmas of privatization: finance, speed, ownership and political outcomes. Vaucher privatization. Loans for shares deals. The rise of oligarchs.
  • Wealth and Inequality
    Distribution of income in Russia and post-Communist world. Rising inequality and its determinants. Offshore wealth, foreign ownership reconsidered.
  • Authoritarian Modernization
    The triple transition problem and the end of the ‘Transition studies’ paradigm. The concept of authoritarian modernization
  • Corruption, Violence and Institutions
    The phenomenon of ‘violent entrepreneurs’ in Russia. Corruption. Institutional performance. The role of fiscal system.
  • Perspectives of Russia’s Economy after the 2014 Crisis
    Structural changes in Russian economy after the 2008-2009 global economy crisis. Geopolitics and economic development: international pressure as a determinant for new economic policy. Sanctions and counter-sanctions. The strategy of isolation and mobilization?
Assessment Elements

Assessment Elements

  • non-blocking quizzes
    Each student will require writing at least 3 quizzes (2 ones per module). An instructor reserves a right to announce a quiz without prior notice. Each quiz will consist of 2-3 questions that will require short answers, up to 3 sentences. All the questions are based on compulsory readings.
  • non-blocking participation
    The assessment of students` work is based on individual participation and individual oral presentations on the issues raised in the compulsory readings. Grading is based on answers to the instructor’s questions addressed to the audience and particular students; students’ questions to the instructor; discussions among students in smaller groups. Students are assessed for the quality of their arguments and ability to analyze critically the problem, engage with the arguments of the book, peers and the instructor, ability to find links between different parts of the course and its readings. Attendance is obligatory. Students must not skip classes without valid reason. If a student misses more than one class without a valid reason, he/she will be punished by reduction of his/her assessment by 5%.
  • non-blocking individual assignment
    During week 4 a few teams of no more than 3 students are expected to prepare a series of group presentations – as country reports on success/failure of market reforms in post-communist countries. The goal of this exercise is to compare reform outcomes in as many as possible post-communist countries. Presentations are to be followed by in-class discussions. Please follow these guidelines: 1) Limit your presentation by 10-12 minutes 2) Limit the number of your PowerPoint slides by 10 3) Suggested structure and content: a. The onset of reform b. The course (and speed) of the reform (narrative) c. Basic facts: figures, tables, charts, graphs etc. d. Country-specific context e. Success or failure: how to assess the reform outcome f. Your comments 4) Please avoid reading your slide (either from paper, or tablet/smartphone, laptop) 5) Each extra 3 min of presentation will be punished by 1 score; reading slides – by 1 score Countries you may chose: Belarus, Ukraine, Moldova, Estonia, Latvia, Lithuania, Georgia, Armenia, Azerbaijan, Uzbekistan, Kyrgyzstan, Turkmenistan, Poland, Hungary, the Czech republic, Slovenia, China, Vietnam.
  • non-blocking essay
    to pass exam each student has to submit an essay on the topic related to the course. The topic of an essay should be approved by instructor and submitted by student no later than two weeks before deadline.
Interim Assessment

Interim Assessment

  • Interim assessment (2 module)
    0.4 * essay + 0.24 * individual assignment + 0.24 * participation + 0.12 * quizzes
Bibliography

Bibliography

Recommended Core Bibliography

  • Dzarasov R. The conundrum of Russian capitalism: The post-Soviet economy in the world system. – London : Pluto Press, 2014. ISBN: 9780745332796
  • Gustafson T. Capitalism Russian-Style. – Cambridge University Press, 1999.
  • Gustafson T. Capitalism Russian-Style. – Cambridge University Press, 1999. ISBN: 9780511149474
  • Robinson N. (ed.). The political economy of Russia. – Rowman & Littlefield, 2012. ISBN: 9781442210745

Recommended Additional Bibliography

  • Connolly, R. (2016). The Empire Strikes Back: Economic Statecraft and the Securitisation of Political Economy in Russia. Europe-Asia Studies, 68(4), 750–773. https://doi.org/10.1080/09668136.2016.1156056
  • Daniel Treisman. (2016). Russia’s Billionaires. American Economic Review, (5), 236. https://doi.org/10.1257/aer.p20161068
  • Filip Novokmet, Thomas Piketty, & Gabriel Zucman. (2018). From Soviets to oligarchs: inequality and property in Russia 1905-2016. The Journal of Economic Inequality, (2), 189. https://doi.org/10.1007/s10888-018-9383-0
  • The Role of Oligarchs in Russian Capitalism. (2005). Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.8D3B9D7A