Two essays on institutions and state in Russia and a study of absorptive capacity
Creators: name: Rochlitz, Michael
Publisher: name: IMT Alti Studi Lucca
Year: 2013
Subjects: HB Economic Theory

description: Chapter 1 presents a short introduction to Russia’s economy in 2013, showing that the country has become more dependent on natural resource
 exports during the last 15 years, despite attempts by the Russian state to diversify the economy. I then undertake a short comparison of industrial policy
 and institutions in Russia and China. I argue that two reasons why China has been more successful than Russia in implementing industrial policy and
 diversifying its economy is the country’s pro-growth incentive structure, and its focus on absorbing technology from abroad. 
 Chapter 2 studies the change in incentives faced by Russian regional governors, after gubernatorial elections were replaced by presidential appointments 
 in 2004. Using an ordered probit model, the chapter examines how various measures of economic performance and political loyalty affect the probability 
 of Russian regional governors to stay in office. While before the 2004 reform, the likelihood to stay in office seems not to depend on political loyalty 
 to the centre, after the reform election results for the president and the Kremlin party play a strong and significant role in explaining the likelihood
 of regional governors to stay in office, while economic performance has a negative effect. I interpret these results as evidence that after the reform in 2004,
 the ruling elites in Moscow started using appointments of regional officials to consolidate their political control over the country, 
 while performance-related criteria play only a secondary role. Chapter 3 presents a novel dataset containing 312 cases of illegal corporate raiding (reiderstvo) 
 that took place between 1999 and 2010 in Russia, assembled through a comprehensive scan of Russian national and regional newspaper archives. 
 Analysing the dataset, I am able to identify a shift in both the regional and sectoral distribution of raiding cases over time, 
 as well as an increasing involvement of state agencies in illegal raiding attacks. Using a fixed-effects panel model, 
 I find that regional election results for the ruling president and his party, as well as the degree to which elections are manipulated throughout Russia’s 
 regions, are significantly and positively correlated with the number of raiding cases in a given region. I also find that regions in which governors have stronger 
 ties to their region suffer from a lower degree of attacks. A possible interpretation of these results is that under Russia’s new authoritarian electoral
 regime, the centre tolerates a certain amount of rent-seeking and predatory activities by regional elites, as long as these elites are able to provide 
 a sufficiently high level of electoral support for the centre. I further argue that the results concerning the local attachment of regional governors 
 can be seen as evidence confirming Mancur Olson’s theory on stationary and roving bandits. Chapter 4 (written together with Letizia Montinari) investigates 
 differences in and determinants of technical efficiency across three groups of OECD, Asian and Latin American countries. 
 In the literature, the kind of technical efficiency we examine is seen as one of the main factors influencing the ability of a country to absorb 
 technology from abroad. Using a stochastic frontier framework and data for 22 manufacturing sectors for 1996-2005, we find notable differences in
 technical efficiency between the three country groups we examine. We then investigate the effect of human capital and domestic R and D, 
 proxied by the stock of patents, on technical efficiency. We find that while human capital has always a strongly positive effect on efficiency,
 an increase in the stock of patents has positive effects on efficiency in high-tech sectors, but negative effects in low-tech sectors.