Beyond Dutch Disease

24 Pages Posted: 16 Mar 2014

See all articles by Erik van der Marel

Erik van der Marel

European Centre for International Political Economy (ECIPE); European Center for International Political Economy

Iana Dreyer

European Union (EU) Institute for Security Studies (EUISS)

Date Written: April 2014

Abstract

How does the deterioration of rule of law in Russia in recent years affect its ability to move away from an export pattern dominated by natural resources? We investigate this question using three datasets for Russia's bilateral trade relations for goods, services and investment at disaggregated level with its partner countries over the world. Our empirical analysis shows that the deterioration of the rule of law in Russia since 2003 has affected the long‐run trade performance of Russia in sophisticated and technology‐intensive manufactured goods, as well as its inward investments with advanced economies. It is precisely this type of trade that Russia should nurture to diversify away from hydrocarbons export dependence. Our statistical analysis also shows that Russia remains to a large extent an outlier within the multilateral trading system. It exports disproportionately less to partner countries which are or had become members of the WTO over our period of analysis. Russia's trade appears to have been negatively affected by the accession of these countries to the WTO. Russia itself finally acceded to the WTO in July 2012 amidst signs of a modest improvement of its rule‐of‐law indicators.

Keywords: Russia, gravity, trade and investment, WTO

Suggested Citation

Marel, Erik van der and Dreyer, Iana, Beyond Dutch Disease (April 2014). Economics of Transition, Vol. 22, Issue 2, pp. 341-364, 2014. Available at SSRN: https://ssrn.com/abstract=2409785 or http://dx.doi.org/10.1111/ecot.12039

Erik van der Marel (Contact Author)

European Centre for International Political Economy (ECIPE) ( email )

Rue Belliard 4-6
Brussels, 1040
Belgium

European Center for International Political Economy

Iana Dreyer

European Union (EU) Institute for Security Studies (EUISS) ( email )

100, avenue de Suffren
Paris, F-75015
France

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
0
Abstract Views
176
PlumX Metrics