Chapter 1

The Institutional Development of Russia:
Grounds of the Theory

Preface

At the turn of the second millennium, attention of the whole world is once again drawn to the processes of economic development in Russia. The possibilities for the global sustainable development are determined to a large extent by the direction in which the transformation in this country will go. The main collision was connected with the question of Russia becoming a country with either market or non-market economy. However the choice of the way is determined not by the will of people but by the regularities of the institutional development of the Russian economy which have not been completely perceived so far.
In this book Russian economy is presented in a new way, as a progressive economy of the razdatok type. The basic laws and institutions of the Russian economy had been formed and perfected during its whole history. Periods of sustainable development gave way to the periods of institutional changes. In these periods a renewal of the out-dated institutions of the razdatok-economy took place through the introduction and adjustment of new elements developed by the modern civilization.

The period of institutional changes of the 1990s represents a market experiment in the razdatok-economy of Russia.