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The Industrialization and Economic Development of Russia through the Lens of a Neoclassical Growth Model


  • Anton Cheremukhin
  • Mikhail Golosov
  • Sergei Guriev
  • Aleh Tsyvinski


This article studies the structural transformation of Russia in 1885–1940 from an agrarian to an industrial economy through the lens of a two-sector neoclassical growth model. We construct a data set that covers Tsarist Russia during 1885–1913 and Soviet Union during 1928–1940. We develop a methodology that allows us to identify the types of frictions and economic mechanisms that had the largest quantitative impact on Russian economic development. We find that entry barriers and monopoly power in the non-agricultural sector were the most important reason for Tsarist Russia’s failure to industrialize before World War I. Soviet industrial transformation after 1928 was achieved primarily by reducing such frictions, albeit coinciding with a significantly lower performance of productivity in both agricultural and non-agricultural sectors. We find no evidence that Tsarist agricultural institutions were a significant barrier to labour reallocation to manufacturing, or that “Big Push” mechanisms were a major driver of Soviet growth.

Suggested Citation

  • Anton Cheremukhin & Mikhail Golosov & Sergei Guriev & Aleh Tsyvinski, 2017. "The Industrialization and Economic Development of Russia through the Lens of a Neoclassical Growth Model," Review of Economic Studies, Oxford University Press, vol. 84(2), pages 613-649.
  • Handle: RePEc:oup:restud:v:84:y:2017:i:2:p:613-649.

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    Cited by:

    1. Viktor Malein, 2021. "Human Capital and Industrialization: German Settlers in Late Imperial Russia," Working Papers 0221, European Historical Economics Society (EHES).
    2. Kufenko, Vadim & Khaustova, Ekaterina & Geloso, Vincent, 2022. "Escape underway: Malthusian pressures in late imperial Moscow," Explorations in Economic History, Elsevier, vol. 85(C).
    3. Tang, Rongsheng & Tang, Yang, 2022. "Market formation in China from 1978," Regional Science and Urban Economics, Elsevier, vol. 95(C).
    4. Chetan Ghate & Gerhard Glomm & Jialu Liu Streeter, 2016. "Sectoral Infrastructure Investments in an Unbalanced Growing Economy: The Case of Potential Growth in India," Asian Development Review, MIT Press, vol. 33(2), pages 144-166, September.
    5. Kukic, Leonard, 2021. "Technical change and the postwar slowdown in Soviet economic growth," IFCS - Working Papers in Economic History.WH 33259, Universidad Carlos III de Madrid. Instituto Figuerola.
    6. Konté,Maty & Kouame,Wilfried Anicet Kouakou & Mensah,Emmanuel Buadi, 2021. "Structural Reforms and Productivity Growth in Developing Countries : Intra- or Inter-Reallocation Channel ?," Policy Research Working Paper Series 9733, The World Bank.
    7. Hirakata, Naohisa & Sunakawa, Takeki, 2019. "Financial frictions, capital misallocation and structural change," Journal of Macroeconomics, Elsevier, vol. 61(C), pages 1-1.
    8. Nikita I. Lychakov & Dmitrii L. Saprykin & Nadia Vanteeva, 2020. "Not Backward: Comparative Labour Productivity In British And Russian Manufacturing, Circa 1908," HSE Working papers WP BRP 199/HUM/2020, National Research University Higher School of Economics.
    9. del Río, Fernando & Lores, Francisco-Xavier, 2021. "Accounting for U.S. economic growth 1954–2017," Economic Modelling, Elsevier, vol. 101(C).
    10. Leonard Kukić, 2020. "Origins of regional divergence: economic growth in socialist Yugoslavia," Economic History Review, Economic History Society, vol. 73(4), pages 1097-1127, November.
    11. Leonard Kukić, 2021. "The Nature Of Technological Failure: Patterns Of Biased Technical Change In Socialist Europe," Journal of Economic Surveys, Wiley Blackwell, vol. 35(3), pages 895-925, July.
    12. Zaman, Kazi Arif Uz, 2022. "Regional Cooperation for Improving Agriculture Production Efficiency: A Strategic Tool for Emission Reduction," ADBI Working Papers 1301, Asian Development Bank Institute.
    13. Asmus, Gerda & Franck, Raphaël, 2022. "State Capacity, National Economic Policies and Local Development: The Russian State in the Southern Urals," CEPR Discussion Papers 17103, C.E.P.R. Discussion Papers.
    14. Johannes C. Buggle & Steven Nafziger, 2021. "The Slow Road from Serfdom: Labor Coercion and Long-Run Development in the Former Russian Empire," The Review of Economics and Statistics, MIT Press, vol. 103(1), pages 1-17, March.
    15. Gregg, Amanda & Nafziger, Steven, 2020. "Financing nascent industry : Leverage, politics, and performance in Imperial Russia," BOFIT Discussion Papers 7/2020, Bank of Finland, Institute for Economies in Transition.
    16. Miss Sanaa Nadeem & Khalid ElFayoumi & Anta Ndoye & Gregory Auclair, 2018. "Structural Reforms and Labor Reallocation: A Cross-Country Analysis," IMF Working Papers 2018/064, International Monetary Fund.
    17. Khalid El Fayoumi & Gregory Auclair, 2019. "The Role of Labor Market Frictions in Structural Transformation," Working Papers 1282, Economic Research Forum, revised 2019.


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