Abstract
Compared to other CEE transition economies during the global financial crisis Russia experienced an extremely high decline of GDP (about 8% in 2009) but could keep and even increased standards of living. However contrary to East‐European countries, in 2013 Russia faced a new economic slowdown and entered a new recession in 2014–2015 after the acceleration of geopolitical tensions with the West within the framework of the Ukrainian crisis. In this chapter we will show the reasons for economic slowdown in 2013 including key features of the Russian model of economic development in the 2000s, its crash during the 2008–2009 global financial crisis, and failed attempts to change the model in 2009–2011. In our opinion, since 2012 political survival incentives clearly started to dominate economic efficiency arguments in policy-making in response to the “Arab Spring” and mass protests in Moscow in December 2011. This turn in the priorities of the country’s leadership as well as a lack of a “vision for the future” provides an extremely negative influence on incentives and the behaviour of economic agents (including the decline of investment and capital flight). Taking into account these political constraints we will discuss key drivers, main risks, and overall prospects of economic development in Russia in the near future.
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Akindinova, N., Chernyavskiy, A., Kondrashov, N., Yakovlev, A. (2017). Political Response to the Crisis: The Case of Russia. In: Havlik, P., Iwasaki, I. (eds) Economics of European Crises and Emerging Markets. Palgrave, Singapore. https://doi.org/10.1007/978-981-10-5233-0_11
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DOI: https://doi.org/10.1007/978-981-10-5233-0_11
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