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Seductions of an Underdevelopment Trap: Systemic Impediments to Agricultural Reform in Russia

  • Dmitry Gershenson
  • Maria Amelina
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    Despite ambitious agricultural reforms initiated by the federal government, inefficient and unprofitable producers predominate in post-Soviet Russia. However, in some regions a more robust restructuring has taken place. Observing two Russian regions-one with substantially restructured agricultural production, and one in which Soviet-style coordination predominates-we develop a model of the interactions between political and economic incentives that lead to these divergent outcomes. The model identifies region- and sector-specific characteristics that encourage some regional governments to maintain Soviet-style redistribution structures and make producers forsake more efficient outcomes as more costly, while encouraging other regions to pursue reform.

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    Paper provided by International Monetary Fund in its series IMF Working Papers with number 02/126.

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    Length: 35
    Date of creation: 01 Jul 2002
    Date of revision:
    Handle: RePEc:imf:imfwpa:02/126
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    1. Rajan, Raghuram G & Zingales, Luigi, 1998. "Power in a Theory of the Firm," CEPR Discussion Papers 1777, C.E.P.R. Discussion Papers.
    2. David Epstein & Peter Tillack, 1999. "How Russian Agricultural Enterprises Are Surviving: The Financial Status of Large Agricultural Enterprises in the St. Petersburg Region," Eastern European Economics, M.E. Sharpe, Inc., vol. 37(5), pages 52-92, October.
    3. Olivier Blanchard & Michael Kremer, 1997. "Disorganization," William Davidson Institute Working Papers Series 38, William Davidson Institute at the University of Michigan.
    4. Galbi, Douglas, 1995. "The significance of credits and subsidies in Russian agricultural reform," Policy Research Working Paper Series 1441, The World Bank.
    5. Ilya R. Segal, 1998. "Monopoly and Soft Budget Constraint," RAND Journal of Economics, The RAND Corporation, vol. 29(3), pages 596-609, Autumn.
    6. Shleifer, Andrei & Vishny, Robert W, 1994. "Politicians and Firms," The Quarterly Journal of Economics, MIT Press, vol. 109(4), pages 995-1025, November.
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