nep-cis New Economics Papers
on Confederation of Independent States
Issue of 2011‒07‒13
eight papers chosen by
Koen Schoors
Ghent University

  1. Russian Inequality on the Eve of Revolution By Steven Nafziger; Peter Lindert
  2. Micro-Perspectives on Living Standards in Nineteenth-Century Russia By Tracy Dennison; Steven Nafziger
  3. Secrecy and Transaction Costs: The Business of Soviet Forced Labour in the Early Cold War By Harrison, Mark
  4. Trade integration,restructuring and global imbalances --A tale of two countries By Teng, Faxin; Meier , Claudia; Kamenev, Dmitry; Klein, Martin
  5. Holding together or falling apart:Results of gravity equation of the CIS trade By Kurmanalieva, Elvira; Vinokurov, Evgeny
  6. Measuring Inequality in CIS Countries: Theory and Empirics By Marat Ibragimov; Rustam Ibragimov; Rufat Khamidov
  7. Does health Matter for Inequality in Transition Countries: The Case of Ukraine By Tamara Podvysotskaya; Elena Osinkina; Larysa Krasnikova; Yuriy Podvysotskiy
  8. Big BRICs, Weak Foundations: The Beginning of Public Elementary Education in Brazil, Russia, India, and China By Steven Nafziger; Latika Chaudhary; Aldo Musacchio; Se Yan

  1. By: Steven Nafziger (Williams College); Peter Lindert (University of California-Davis)
    Abstract: Just how unequal were the incomes of different classes of Russians on the eve of Revolution, relative to other countries, to Russia’s earlier history, and to Russia’s income distribution today? Careful weighing of an eclectic data set provides provisional answers. In 1904, on the eve of military defeat and the 1905 Revolution, Russian income inequality was middling by the standards of that era, and less severe than inequality has become today in such countries as China, the United States, and Russia itself. We enrich this emerging story by noting some distinctive fiscal and relative-price features of Imperial Russia. We hope that this report sets the stage for comparisons to Russian before the serf Emancipation of 1861.
    Keywords: Russia, inequality, economic history
    JEL: N30 N33 O15
    Date: 2011–03
  2. By: Tracy Dennison (California Institute of Technology); Steven Nafziger (Williams College)
    Abstract: In recent years economic historians have turned new attention to questions about standards of living in pre-revolutionary Russia. However, most of the studies to date have focused on a narrow range of measures for predominantly urban areas. We expand on the existing literature with a micro-level analysis, which employs a broader set of measures of wellbeing for a small rural region in central Russia. Our findings suggest that living standards were improving over the nineteenth century, even in such seemingly less dynamic rural areas. Income and consumption patterns, human capital development, and the distribution of resources in the countryside were more variegated than a ‘subsistence’ approach has typically allowed. The micro-level context presented here suggests that state and local institutions should be emphasized in future analyses of rural living standards in pre-Soviet Russia.
    Keywords: Russia, livings standards, economic history
    JEL: N33 N93 O12
    Date: 2011–06
  3. By: Harrison, Mark (University of Warwick)
    Abstract: In 1949 the Cold War was picking up momentum. The Soviet state had entered its most secretive phase. The official rationale of secrecy was defense against external enemies. One of the Gulag’s most important secrets was the location of its labour camps, scattered across the length and depth of the Soviet Union. As this secret was guarded more and more closely, the camps began to drop out of the Soviet economic universe, losing the ability to share necessary information and do business with civilian persons and institutions without disclosing a state secret: their own location. For some months in 1949 and 1950, the Gulag’s camp chiefs and central administrators struggled with this dilemma without achieving a resolution. This episode teaches us about the costs of Soviet secrecy and raises basic questions about how secrecy was calibrated.
    Keywords: Cold War, Forced Labour, Secrecy, Transaction Costs, Soviet Union
  4. By: Teng, Faxin; Meier , Claudia; Kamenev, Dmitry; Klein, Martin
    Abstract: China is widely seen as one of the sources of global macroeconomic imbalances. Its persistent current account surplus and capital exports to the United States are even cited as one of the causes of the global financial crisis. The most common explanation traces China's current account surplus to a mismatch between saving and investment due to inefficiently low domestic demand. We challenge this explanation. Our argument rests on an analogy that we construct between two countries generally thought to be very different: Russia and China. Russia, a raw materials exporting country, has been running current account surpluses similar to China's in relation to GDP. As for most raw materials exporting countries this is considered normal, reflecting efficient reinvestment of wealth from natural resources in financial assets. We show that a similar efficiency argument can be constructed for China, although the nature of wealth that is reinvested in financial assets is different in the two countries. Our analysis implies that China's current account surpluses can be expected to disappear over the long horizon – although the time when this will happen may still be very far away. Moreover, an appreciation of the Chinese currency may not have the desired effect of mitigating the country's current account surplus as a weakening in competitiveness is counterbalanced by a strengthening of investment motives.
    Keywords: trade structures;trade imbalances; current account imbalances; outside assets
    JEL: F14
    Date: 2011–06
  5. By: Kurmanalieva, Elvira; Vinokurov, Evgeny
    Abstract: The main purpose of this paper is to assess intra-regional trade within the CIS by looking at the impact of numerous trade agreements in the region. Applying a gravity model on a set of 162 countries, we attempt to assess dynamics of intra-regional trade of various trade agreements between 1995 and 2008 in order to identify trade creation and trade diversion effects. We propose and empirically test three explanations of the CIS intra-regional trade: 1) home bias effect, 2) holding together effect and 3) holdup effect. Finally, we perform a simulation of potential trade and see to what extent twelve post-Soviet states and all their groupings would, ceteris paribus, have traded with each other.
    Keywords: Soviet Union; CIS; EurAsEC; CES; Gravity equation; Trade potential; Panel data
    JEL: F15 F13 C23 O54 O52
    Date: 2011–06
  6. By: Marat Ibragimov; Rustam Ibragimov; Rufat Khamidov
    Abstract: Distributions of many variables of interest in developed economic and financial markets, including income and wealth, exhibit heavy tails as in the case of Pareto or power laws. Many commonly used income and wealth inequality measures are very sensitive to extremes and outliers generated by these distributions due to their heavy-tailedness properties. This paper focuses on robust analysis of distributions and heavy-tailedness characteristics for data on income and wealth for the World, Russia and post-Soviet Central Asian economies. Among other results, it provides robust estimates of heavy-tailedness parameters for income and wealth in the markets considered and their comparisons with the benchmark values that are well-established for distributions of these variables in developed economies. The paper further provides applications of the obtained empirical results to inference on inequality measures and discusses their implications for market demand and economic equilibrium.
    Keywords: Income inequality, wealth inequality, CIS countries, Russian economy, post-Soviet economies, heavy-tailedness, power laws, Pareto distribution, income inequality, market demand, economic equilibrium
    JEL: C14 D31 P24
    Date: 2010–12
  7. By: Tamara Podvysotskaya; Elena Osinkina; Larysa Krasnikova; Yuriy Podvysotskiy
    Abstract: Significant deterioration in health and income inequality in Ukraine as well as in other CIS countries during the early transition motivated us to investigate the relationship between the two categories. Based on both macro- and micro-data analysis we focused on how different aspects of health affect income inequality in Ukraine. Significant impact of health has been proven on both micro- and macro levels. According to macrolevel results, a 1% increase in life expectancy leads to a 2,1% decrease in income inequality as measured by index Gini. Micro-level research also evidenced significance of different health aspects for income inequality.
    Keywords: Income inequality, health, Ukraine, Ukrainian Longitudinal Monitoring Survey
    Date: 2011–01
  8. By: Steven Nafziger (Williams College); Latika Chaudhary (Scripps College); Aldo Musacchio (Harvard Business School); Se Yan (Peking University)
    Abstract: Our paper provides a comparative perspective on the development of public primary education in four of the largest developing economies circa 1910: Brazil, Russia, India and China (BRIC). These four countries encompassed more than 50 percent of the world’s population in 1910, but remarkably few of their citizens attended any school by the early 20th century. We present new, comparable data on school inputs and outputs for BRIC drawn from contemporary surveys and government documents. Recent studies emphasize the importance of political decentralization, and relatively broad political voice for the early spread of public primary education in developed economies. We identify the former and the lack of the latter to be important in the context of BRIC, but we also outline how other factors such as factor endowments, colonialism, serfdom, and, especially, the characteristics of the political and economic elite help explain the low achievement levels of these four countries and the incredible amount of heterogeneity within each of them.
    Keywords: Brazil, Russia, India, China, economic history, education, political economy, elites
    JEL: N30 O15 I22 I28
    Date: 2011–06

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