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SITE Working Papers We review two recent SITE papers. The first is a result of the ongoing research on Russia’s industry. Most SITE and RECEP Working Papers are downloadable at: www.hhs.se/site and www.recep.org. Annette N. Brown, Barents Group, and J. David Brown, SITE, The Transition of Market Structure in Russia: Economic Lessons and Implications for Competition. Using a wide variety of indicators, the authors analyze how the industrial structure of Russia is changing during transition, and whether these changes are promoting competition. They then investigate the economic processes that direct these changes and econometrically test several hypotheses concerning the determinants of market structure. They find that the Russian industrial structure is experiencing dramatic changes. The size distribution of firms is generally converging to that found in the United States. Manufacturing concentration is increasing on average, but these averages mask huge structural changes. Product concentration is decreasing. The various structural changes suggest that the potential for competition is improving. Ekatherina Zhuravskaya, SITE/RECEP, Incentives to Provide Local Public Goods: Fiscal Federalism, Russian Style, SITE Working Paper 153, 2000. Over the past decade the fiscal power of the regional governments increased enormously. Economic models of federalism generally emphasize beneficial effects of decentralization and especially the importance of competition between regions to attract mobile voters or capital. In Russia, however, regions compete not only to provide public goods efficiently but mostly in other ways. The Russian system of inter-governmental relations encourages government officials at all levels to neglect tax collection, disregard requests of the federal center, overspend, and subsidize inefficiently. The lack of clear division of responsibility with regard to revenues and expenditures results in constant bargaining between the regions and the federation—that is, between the localities and the regions. The author (RECEP Academic Director; Ph.D. Harvard University 1998) is the first holder of a Hans Rausing Assistant Professorship in a joint appointment between SITE and RECEP. A 10-year grant to SITE from the Fanny and Leo Koerner Charitable Trust funds these academic positions for Russian graduates returning to work in their home country. She is also the winner of the Young Economists Competition of the Nobel Symposium. |
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