Democratization, Quality of Institutions and Economic Growth

There are two innovations in the paper as compared to the previous literature on democracy and growth. First, we consider not only the level of democracy, but also changes in this level in the 1970s-1990s as measured by increments of Freedom House political rights indices. Second, the distinction is made between democracy and law and order (order based on legal rules); the latter is measured by the rule of law, investors' risk and corruption indices. We discuss two interconnected threshold hypotheses: (1) in countries where law and order is strong enough, democratization stimulates economic growth, whereas in countries with poor law and order democratization undermines growth; (2) if democratization occurs under the conditions of poor law and order (so that illiberal democracy emerges), then shadow economy expands, quality of governance worsens, and macroeconomic policy becomes less prudent. We adduce a number of stylized facts to support our hypotheses. However our econometric findings are mixed: we report results that support the hypotheses as well as regressions that contradict them

Integration Dilemmas of the Common Economic Space

The paper addresses key political economy dilemmas associated with the formation of the Common Economic Space (CES) by Russia, Belarus, and Kazakhstan. Analysis is focused on alternative integration strategies, prospects of the CES enlargement, and elimination of trade and investment barriers. Unification of regulatory norms and technical standards using the EU experience as well as negotiating free trade agreements with the EU and countries of the Asia-Pacific are shown to be crucial for the future of the CES project

ECONOMIC-POLITICAL DETERMINANTS OF IMPORT TARIFF UNIFICATION

The economic-political determinants of the Russian import tariff reform in 2000 − 2001 years, leading up to partial unification of the import customs duties, are considered a With this purpose the model of tariff policy definition which considers the aspiration of the government to minimize the losses of tariff incomes caused by incorrect declaring of the goods by importers is constructed in the work. It is revealed, that reception of tariff incomes was the main motive at the development of tariff policy; the following on a degree of importance were the motives connected with increase of citizens well-being and attraction of support from business lobbies. As a whole, the government has established lower rates of the tariff for the goods with higher probability of incorrect declaring, and higher rates - for the goods which otherwise could be used as a "screen" for incorrectly declared goods. At the same time significant opportunities for the further unification of import duties which can serve as perspective strategy of tariff policy during a transition period after Russian connection to WTO are kept