Effectiveness of the Russian institutional development: an alternative assessment

Evgeny Balatsky
Doctor of Economics (DSc), Professor, Director of Macroeconomic Research Center, Financial University under the Government of Russian Federation, Leading Staff Scientist at Central Economics and Mathematics Institute of Russian Academy of Sciences (CEMI RAS), Moscow, Russia

Natalia Ekimova
Candidate of Economics (PhD), Associate Professor, Leading Staff Scientist at Financial University under the Government of Russian Federation, Moscow, Russia

TERRA ECONOMICUS, 2015, Vol. 13 (no. 4),

p. 31-51
DOI: 10.18522/2073-6606-2015-4-31-51

The article proposes an alternative measure of efficiency of institutions – the base index of institutional development (BIID). The need for developing this kind of indicator is due to the subjectivity and political bias of most Western tools to measure the quality of institutions and low level of trust of the expert community to this measure. A distinctive feature of the developed index is that it is based solely on objective data that can be easily double-checked by the expert community. In the basis of BIID on the ideology of the two polar sides of institutions – they provide guarantees and freedoms. Simultaneously, all institutions are divided into three large groups: social, economic, political. Testing of the BIID in national and international contexts is carried out. The international dimension presupposes ranking BIID for a sample of eight countries in the world – the USA, Germany, UK, Belarus, Ukraine, Kyrgyzstan, Armenia and Russia. The calculations have allowed to establish the existence of the European (continental) and Atlantic (Anglo-Saxon) models of institution building. It is shown that at first all the transition countries provide solid institutional guarantee and only then begin to bring about institutional freedoms. A retrospective analysis of the Russian BEER showed that over the past 15 years the major advances the country had made are related with political stability improving, while the main problem area of the previous period of development has been the enslavement of economic institutions.

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Keywords: index of institutional development; efficiency of institutions; institutional guarantees; institutional freedom; model of economic growth

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Publisher: Southern Federal University
Founder: Southern Federal University
ISSN: 2073-6606