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Structural Change during Transition: Is Russia Becoming a Service Economy?


  • Albrecht Kauffmann


This paper analyses the structural change in Russia during the transition from the planned to a market economy. With regard to the famous three sector hypothesis, broad economic sectors were formed as required by this theory. The computation of their shares at GNP at market prices using Input-Output tables, and the adjustment of results from distortions, generated as side effects of tax avoidance practices, shows results that clearly reject claims that Russia would be on the road to a post-industrial service economy. Instead, at least until 2001, a tendency of "primarisation" could be observed, that presents Russia closer to less-developed countries.

Suggested Citation

  • Albrecht Kauffmann, 2005. "Structural Change during Transition: Is Russia Becoming a Service Economy?," Volkswirtschaftliche Diskussionsbeiträge 80, Universität Potsdam, Wirtschafts- und Sozialwissenschaftliche Fakultät.
  • Handle: RePEc:pot:vwldis:80

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    References listed on IDEAS

    1. Keir G. Armstrong, 2004. "A Graphical Depiction of Hicksian Partial-Equilibrium Welfare Analysis," Carleton Economic Papers 04-09, Carleton University, Department of Economics.
    2. Eaton, B Curtis & Lipsey, Richard G, 1978. "Freedom of Entry and the Existence of Pure Profit," Economic Journal, Royal Economic Society, vol. 88(351), pages 455-469, September.
    3. Perloff, Jeffrey M. & Suslow, Valerie Y. & Seguin, Paul J., 1995. "Higher Prices from Entry: Pricing of Brand-Name Drugs," Competition Policy Center, Working Paper Series qt75g4k1nt, Competition Policy Center, Institute for Business and Economic Research, UC Berkeley.
    4. Anderson, S., 1986. "Equilibrium existence in the circle of product differentiation," CORE Discussion Papers 1986006, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    5. d'Aspremont, C & Gabszewicz, Jean Jaskold & Thisse, J-F, 1979. "On Hotelling's "Stability in Competition"," Econometrica, Econometric Society, vol. 47(5), pages 1145-1150, September.
    6. Economides, Nicholas, 1986. "Minimal and maximal product differentiation in Hotelling's duopoly," Economics Letters, Elsevier, vol. 21(1), pages 67-71.
    7. Novshek, William, 1980. "Equilibrium in simple spatial (or differentiated product) models," Journal of Economic Theory, Elsevier, vol. 22(2), pages 313-326, April.
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    Cited by:

    1. Albrecht Kauffmann, 2007. "Transport Costs and the Size of Cities : the Case of Russia," Volkswirtschaftliche Diskussionsbeiträge 93, Universität Potsdam, Wirtschafts- und Sozialwissenschaftliche Fakultät.
    2. Jovan Zubovic, 2012. "Human Capital Development as a Tool for Managing Structural Changes - Secondary Education vs. Structural Change," Book Chapters, Institute of Economic Sciences.
    3. Klaus Schöler, 2007. "Gibt es eine optimale Stadtgröße?," Volkswirtschaftliche Diskussionsbeiträge 89, Universität Potsdam, Wirtschafts- und Sozialwissenschaftliche Fakultät.

    More about this item


    Russian Federation; Deindustrialisation; Natural Resources; Conversion;

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O39 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Other
    • P28 - Economic Systems - - Socialist Systems and Transition Economies - - - Natural Resources; Environment
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance

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