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New elites and their influence on entrepreneurial activity in Russia

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  • Shurchkov, Olga

Abstract

When Russia transitioned to a democratic institutional system in 1991, some of its regions remained under control of old Communist Party elites, while some fell into the hands of political newcomers (“new elites”). Using a new panel dataset spanning 71 of the Russian regions over the years 1994–2006, I show that regions with new-elite governors whose rise to power was influenced by Putin ended up with significantly fewer small and medium enterprises (SMEs) than otherwise similar regions governed by old elites. One interpretation of this result is that Putin, in alliance with the oligarchs, sought to extend his power to the distant resource-abundant regions by promoting relatively inexperienced new elites to govern those regions. As the oligarchs of big business were allowed to monopolize the resources of the new-elite regions, entrepreneurial activity remained at depressed levels. The newcomers’ lack of leadership experience may have also contributed to this result.

Suggested Citation

  • Shurchkov, Olga, 2012. "New elites and their influence on entrepreneurial activity in Russia," Journal of Comparative Economics, Elsevier, vol. 40(2), pages 240-255.
  • Handle: RePEc:eee:jcecon:v:40:y:2012:i:2:p:240-255
    DOI: 10.1016/j.jce.2011.12.003
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Kobil Ruziev & Don Webber, 2017. "SMEs access to formal finance in post-communist economies: Do institutional structure and political connectedness matter?," Working Papers 20171701, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    2. Nye, John V.C. & Vasilyeva, Olga, 2015. "When does local political competition lead to more public goods?: Evidence from Russian regions," Journal of Comparative Economics, Elsevier, vol. 43(3), pages 650-676.
    3. Guriev, Sergei & Vakulenko, Elena, 2015. "Breaking out of poverty traps: Internal migration and interregional convergence in Russia," Journal of Comparative Economics, Elsevier, vol. 43(3), pages 633-649.
    4. Schoors, Koen & Weill, Laurent, 2017. "Russia's 1999–2000 election cycle and the politics-banking interface," BOFIT Discussion Papers 17/2017, Bank of Finland, Institute for Economies in Transition.
    5. Libman, Alexander & Obydenkova, Anastassia, 2013. "Communism or communists? Soviet legacies and corruption in transition economies," Economics Letters, Elsevier, vol. 119(1), pages 101-103.
    6. Carol S. Leonard & Zafar Nazarov & Elena S. Vakulenko, 2016. "The impact of sub-national institutions," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 24(3), pages 421-446, July.

    More about this item

    Keywords

    Small enterprises; Political development; Economic transition;

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
    • P2 - Economic Systems - - Socialist Systems and Transition Economies
    • P3 - Economic Systems - - Socialist Institutions and Their Transitions

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