When and Why Have the Paths of Russia and Western Europe Diverged? A View from Institutional Economic Theory

Abstract

Rustem Nureev — Professor, Sub-department of Economic Analysis of Organizations and Markets, National Research University “Higher School of Economics”. Address: 20, Myasnitskaya St., Moscow, 101000, Russian Federation. E-mail: nureev@hse.ru

Yuri Latov — Leading Researcher, Management Academy of the Ministry of Internal Affairs in Russian Federation. Address: 8, Z. and A. Kosmodemyanskikh St., Moscow, 125171, Russian Federation. E-mail: latov@mail.ru

Russian civilization lies between the civilizations of the West (based on the institution of private property) and East (based on power-ownership). It combines the contradictory features of ‘backward Europe’ and ‘advanced Asia’.

The development of Russian civilization (19—20th centuries) can be described as a fluctuation between the pro-Eastern (stronger) and the pro-Western vector of development. The permanent confrontation between these trends was reflected in continuous conflicts with external aggressors, as well as between the Russian states. The successive domination of Eastern institutions can, apparently, be explained by the compatibility of ‘oriental despotism’ with the constant the need to cope with external aggression, which has threatened the very existence of Russian civilization throughout its development.

In the initial phase of its development (9—16th centuries), the Russian civilization was shaped under the influence of institutional export from the politically powerful states in the East (Byzantium, the Golden Horde, Turkey). The export of institutions from western countries only began with the 17th century. Such export was always complicated by the path dependency phenomenon, because throughout the course of its formation Russia has developed its identity in opposition to the West rather than the East.

The development of Russian civilization can be disassembled into six steps:

— Kievan Rus’ (9—13th c.) was regarded by some contemporary authors as a European state (which is particularly reflected in the facts of early dynastic marriages between the Ruriks and the families of the European rulers);

— a split of Russian civilization during the Tatar conquest (13—15th c.): the eastern lands subservient to the Golden Horde (Moscow princedom) became more ‘orientalized’, while the western domain (the Grand Duchy of Lithuania and Novgorod the Great) remained the periphery of Europe;

— the formation of the Moscow kingdom (16—17th c.), a period of active confrontation between four models of the Russian State (Moscow, Novgorod, Lithuanian and Cossack), which ends with complete victory of the East-oriented Moscow and the gradual fading of alternative models;

— Russian Empire (18—19th c.), a clear example of catch-up development with selective imports of Western institutions and a gradual reduction in the gap between Russia and Europe; however, even by the end of the St. Petersburg period, Russia could not be considered a fully European country;

— the Soviet era (20th c.), a period of counter-modernization and attempts to eliminate the technological backwardness of Soviet Russia; the party leadership deliberately revives the institutions of power-ownership in order to ensure the dynamic construction of a communist society;

— the post-Soviet Russian civilization splits into three independent states (Russia, Ukraine and Belarus), each of which demonstrates particular pro-Eastern and pro-Western trend of institutional development, but none of them can still be considered as having completely adopted a sustainable development path for their national economies.

The Russian transformation into a part of Western civilization is highly unlikely. The active spread of Western European institutions has always caused resentment among Russian people, which is why the history of Russia can be described as a series of constant shifts, i.e. in-flows and out-flows of Europeanization. However, in the 21st century the Europeanization policy for Russia is even less attractive, since at present Western civilization is gradually losing its role as a world leader, while the Confucian and Islamic civilizations seek to reclaim such a role. The best option for Russia is to reconstruct its identity as a unique civilization. While being geographically located on the outskirts of Europe, it is rather a ‘different Europe’, an ‘alternative Europe’. Acting as a buffer between East and West, Russia can play an important role in channeling the ‘clash of civilizations’ into the mainstream of mutually beneficial institutional competition. The competing national models of development in Russia, Ukraine and Belarus can be regarded as particular examples of such a phenomenon.