Chris Miller’s book is a historian’s account of Mikhail Gorbachev’s efforts to save the Soviet economy. Miller focuses on the question of why Gorbachev did not follow Deng Xiaoping and did not manage to reform the economy. Miller argues that it was not for the lack of understanding (Gorbachev did invest in learning China’s approach to reform and did understand it well), nor for the lack of trying. In fact, Gorbachev did try to implement Deng’s agricultural and industrial enterprise reforms. However, Gorbachev’s reforms were blocked by powerful vested interests. An inability to tackle the agricultural and industrial lobbies eventually resulted in the bankruptcy and collapse of the Soviet Union. While I generally agree with the political economy argument, I discuss a number of alternative explanations. I also discuss sources of Gorbachev’s weak state capacity and offer an evaluation of Gorbachev’s and post-Gorbachev reform efforts and mistakes based on the political economy research carried out in the last twenty-five years.

This survey discusses recent developments in the growing literature on the economic history of Russia in the nineteenth and twentieth centuries. Using novel data and modern empirical methods, this research provides important lessons for development and political economy. We address four strands of this literature. First, we present long-term trends in economic development, illustrating that throughout history, Russia significantly underperformed advanced economies, and quantify the human cost of Joseph Stalin’s dictatorship. Second, we discuss studies of imperial Russia focusing on the causes of Russia’s relatively low level of economic development and the 1917 revolution. The third strand of the literature focuses on the Soviet period, explaining its slowdown over time and eventual collapse. The fourth strand documents the long-term economic, social, and political consequences of large-scale historical experiments that took place during both the imperial and Soviet periods. We conclude by discussing the lessons from this research and highlighting open questions.

We use weekly data from 79 Russian regions to measure the impact of economic shocks and proximity to war in Ukraine on social capital in Russian regions. We proxy social capital by the relative intensity of internet searches for the most salient dimensions of pro-social behavior such as “donate blood”, “charity”, “adopt a child” etc. This measure of social capital is correlated with a survey-based measure of generalized social trust. Our search-based measure of social capital responds negatively to the spikes of inflation and positively to the intensity of the conflict in Ukraine (controlling for region and week fixed effects).

The paper shows how time considerations, especially those concerning contract duration, affect incomplete contract theory. Time is not only a dimension along which the relationship unfolds, but also a continuous verifiable variable that can be included in contracts. We consider a bilateral trade setting where contracting, investment, trade, and renegotiation take place in continuous time. We show that efficient investment can be induced either through a sequence of constantly renegotiated fixed-term contracts; or through a renegotiation-proof “evergreen” contract—a perpetual contract that allows unilateral termination with advance notice. We provide a detailed analysis of properties of optimal contracts.

Does state ownership hinder or help firms access credit? We use data on almost 4 million firms in 89 countries to study the relationship between state ownership and corporate leverage. Controlling for country-sector-year fixed effects and conventional firm-level determinants of leverage, we show that state ownership is robustly and negatively related to corporate leverage. This relationship holds across most of the firm-size distribution – with the important exception of the largest companies – and is stronger in countries with weak political and legal institutions. A panel data analysis of privatized firms and a comparison of privatized with matched control firms yield similar qualitative and quantitative effects of state ownership on leverage.

How does mobile broadband internet affect approval of government? Using Gallup World Poll surveys of 840,537 individuals from 2,232 subnational regions in 116 countries from 2008 to 2017 and the global expansion of 3G mobile networks, we show that on average, an increase in mobile broadband internet access reduces government approval. This effect is present only when the internet is not censored, and it is stronger when the traditional media are censored. 3G helps expose actual corruption in government: revelations of the Panama Papers and other corruption incidents translate into higher perceptions of corruption in regions covered by 3G networks. Voter disillusionment had electoral implications. In Europe, 3G expansion led to lower vote shares for incumbent parties and higher vote shares for the antiestablishment populist opposition. Vote shares for nonpopulist opposition parties were unaffected by 3G expansion.