Educating Russians in Modern Economics: New Economic School Enters Second Decade
by Sergei Guriev and Gur Ofer

Since its inception in 1992, hundreds of graduates, dozens of research projects, and several international conferences and workshops have proven the viability of Russia’s New Economic School (NES). Established soon after the regime change in Russia, it started to teach modern economics as distinct from the Marxist theory prevailing for 70 years. The NES also has a research center for training students and conducting economic research, as well as an active outreach center that disseminates information about modern economics to faculties and hundreds of researchers across the country. In December, in recognition of the school’s distinguished role, leading economists from around the world attended a conference to commemorate 10 years of the NES.

The December conference, titled The State of Economics and of Transition—Honoring 10 years of the New Economic School, provided an excellent opportunity to showcase the NES and its capabilities to the large community of economists and policymakers in Russia. The NES was established in 1992 in partnership with the Central Economic Mathematics Institute of the Russian Academy of Sciences and the Hebrew University in Jerusalem, plus the involvement of a group of Western economics professors. The aim was to replace the Marxist economic paradigm and the way economics had been taught under the old regime with modern, Western economics.

The NES offers a two-year graduate program in economics, similar to programs at the top Western institutions. Through its Research Center, the NES provides training in modern research methods and how to apply economic analysis to transition issues and the Russian economy. Through its Outreach Center, the NES brings modern economics training to economists outside Moscow. In this way, the NES is engaged in training a new generation of professional, academic, and research economists for Russia who are familiar with the concepts of a market economy. The NES has already become the model for a similar school in Ukraine and for new institutions planned elsewhere in the former Soviet Union.

During the school’s early years visiting professors from the West, who adapted complete Western curricula, provided most of the instruction. Over time, however, an increasing number of Russian teachers trained at the school and abroad have participated. The top graduating students were sent to leading Western universities for their PhD, studies in order to gradually build an indigenous academic base for modern economics in Russia. At present, the NES’s economics faculty is the only such faculty in Russia where most staff is Western educated.

During the NES’s first decade more than 140 of the 320 graduates have pursed PhD, studies at the best universities in the West. Many have returned to Russia to carry out research and to teach at the NES. Approximately 170 NES graduates are pursuing professional careers in Russia and most are already working as professional economists in the public and private sectors, primarily in Moscow. Together with those who returned from Western universities, the graduates of NES and a few other schools and think tanks have begun to form the core of an emerging, modern, high-level, policymaking community in Moscow:

The NES’s Research Center was established in 1995 to encourage modern economics research in Russia. Research projects include such topics as pension reform in Russia, health in transition, foreign direct investment in the Russian economy, financial markets, fiscal federalism, tax reform, political economy of economic reform, corruption, and barter in Russia. Since 1995 the Research Center has organized more than 48 different research projects and has hosted two research conferences each year.

The NES also contributes to the upgrading of economics teaching and research in the rest of Russia through an active outreach program. It runs workshops for teachers of economics at various Russian universities in econometrics, microeconomics, and macroeconomics, and has entered into partnerships with economics faculties at Voronezh State University and the Urals State University in Yekaterinburg.

Over the years the NES has been supported by the Soros Foundation, the Eurasia Foundation, the Ford Foundation, the MacArthur Foundation, the World Bank, and Citibank, and in Russia by the National Training Foundation, the Institute for Financial Studies, Peter Aven, the Troika Dialog, the electricity giant RAO-UES, Lusine Construction, and others.

NES graduates teach in other Russian universities and work in government agencies and the central bank. One NES graduate, Arkady Dvorkovich, is deputy minister of economic development and trade, and other graduates in the Ministry of Finance provide the minister with professional advice. Another group established CEFIR, an independent think tank that advises the government. Others are employed by international organizations in Moscow and by the private sector, including YUKOS, Alfa Bank, Troika Dialog, and KMPG. The NES hopes to deepen its cooperation and interaction with other Russian institutions and society at large through its graduates, its research and policy work, and its outreach to other universities and institutions, as well as through the recently established Russian Advisory Board.

Sergei Guriev is vice president for strategic development at the NES and Gur Ofer is the NES’s international advisory board coordinator. For more information about the NES conference go to http://www.nes.ru/NES10/conf-materials.htm.