Revolutions and evolutions in Russia: In search of a solution to the path dependence problem

Abstract

Russian history demonstrates its propensity to "revolving motions," particularly in regard to the institutions of serfdom and autocracy, thus illustrating the existence of path dependence. Over time, Russia attempted to leave the inefficient development trajectory through two alternative modalities: revolution and evolution. However, the goals of revolutions are typically specific. As such, the primary vector of transition (after the revolutions of 1991 and 1993) was directed at overcoming the shortage economy and moving towards a consumer society, rather than at building a market economy and democratic society. In Russia, the social contract concept evolved since 2000, and included a sequence of three different formulations: "taxes in exchange for order" were announced, "loyalty in exchange for stability" de facto implemented, and "constrained consumption in exchange for belonging to the superpower" emerged after 2014. I thus argue that Russia's development strongly requires a long-term strategy focus on changing informal institutions and the social contract, so that institutional reforms and new incentives can be put in place.