The "New" Political Economies: (A View from Russia). (New Perspectives on Transition Economic: Europe)

Kollontai, Vladimir, The American Journal of Economics and Sociology

I

POLITICAL ECONOMY, though it often purports to discover (formulate) universal, eternal truths, is in real life a constantly changing set of concepts and theories, reflecting transformations in the economy and polity (and this interaction), in historic contexts and country specifics, in perceptions and ideologies. (1) Accordingly, there is always something new and something old in any political economy. In this sense we can speak of many different political economies.

Political economies attempt to understand the functioning of an economy in a broader societal context. This is a task of growing complexity, given the constantly increasing division of labour, interdependencies, changing technologies, regulatory mechanisms, and evolving economic, organisational, management and other structures. As distinct from pure economics--which concentrates on the internal logic of economic systems--political economies in varying degrees acknowledge the impact on economic developments of political and (to a lesser extent) ideological, cultural and other societal factors and make it a part of their analysis.

In economically forerunner countries, the interrelationship between economics and politics evolved gradually. Economic development created many prerequisites of modern democratic politics. The policies pursued were indispensable in shaping existing market structures and mechanisms (granting a predominant place to free market and free competition thinking). A special effort was made to channel the interaction between economic development and politics into a preconceived, stable pattern, aiming inter alia at a certain independence of one from the other.

In late-coiner, peripheral countries of the world economy (developing and ex-socialist countries), which are trying to modernise and catch up, by definition the role of politics (and ideology) in economic development is much greater. Decisions have to be taken as to what goals should be set and in what priority, what elements of modern societies could be transplanted, in what sequence and timeframe, and so forth. This inevitably leads to periods of condensed social change with extreme political, ideological and economic shifts and confrontations. Moreover, modernisation presupposes profound societal transformations, which give rise to serious problems of legitimacy. In these circumstances economic considerations of efficiency are constantly tempered by considerations of expanding the social base of the modernising regime, by attempts to gain internal and external political support and stability, etc. Such a preeminence of political considerations is especially evident in the early stages of condensed social c hange, before a new pattern of society begins to crystallise. All this leads to a myriad of various political economies with abundant protectionist features.

In contemporary Western societies, globalisation, environmental issues and the transition to post-industrial, knowledge-based societies are also raising the prospect of condensed social changes and its numerous related questions. To what extent are existing property rights, economic structures and mechanisms, political institutions and so on going to change and what are the likely social consequences of these changes? To what extent will new trends and processes modify our previous perceptions of the interaction between politics and economics? Hence the endless references to a "new" political economy.

In debating these issues it might be useful to take a look at the Russian experience of socioeconomic transformations. During the twentieth century Russia has gone through two fundamental transformations, both instigated to a large degree by perceived knowledge (alleged understanding) of societal processes, by vested interests and by related ideologies.

II

Some Russian Specifics

SOCIETAL TRANSFORMATIONS INEVITABLY must overcome various forms of social inertia that often constitute a major cause of gross deviations of results from intents. It is therefore necessary to dwell briefly on some of the major specifics of Russian socioeconomic development that have accumulated through the ages and that profoundly influence political economies in Russia.

1. Russia is a vast country with a very harsh climate. As a result there are major additional costs (transport, heating and so on) for practically all economic activities. Competitiveness can often be achieved only through disproportionally large inputs and/or lowering labour costs and standards of living. An often-implicit understanding of this has resulted in a widespread distrust of market economy and economic liberalism, leading to a yearning for alternative approaches. (2)

2. Historically, central governments have had a rather limited impact on vast areas outside of a few major centres. This has created a situation in which even very important laws often have been laxly enforced; traditions of being law-abiding have been extremely weak. Most issues have been decided by local authorities acting on their own under little restraint from the central power. Hence, widespread corruption and local tyranny has prevailed. Most people have tended to evade the formal judicial system, resolving conflicts outside of the courts on the basis of customs, traditions, local perceptions of justice and equality. All this was only partially modified under the Soviet regime. (3)

3. Historically and geographically, Russia has been under much less pressure than smaller nations to move toward more intensive production patterns or to adopt more conciliatory (based on compromises) social …

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Publication information: Article title: The "New" Political Economies: (A View from Russia). (New Perspectives on Transition Economic: Europe). Contributors: Kollontai, Vladimir - Author. Journal title: The American Journal of Economics and Sociology. Volume: 61. Issue: 1 Publication date: January 2002. Page number: 217+. © 1999 American Journal of Economics and Sociology, Inc. COPYRIGHT 2002 Gale Group.

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