Ararat Osipian. Address for correspondence: Department of Leadership, Policy, and Organizations, Peabody College of Education, Payne Hall 205, Vanderbilt University, Nashville, TN 37203, USA. email@example.com.
Thomas Remington examines the empirical evidence on how political regimes in different Russian regions influence such major economic factors as wages, incomes, social spending, poverty, and social dependency. The author offers a general review of major trends in employment, earnings, and social welfare in Russia over the last quarter century. He then proceeds with a set of case studies of Russian regions and their adaptation to market transition and democratic changes. Remington seeks explanations for discovered differences in regime characteristics across regions, showing that income inequality is higher in regions with more pluralistic regimes.
In addition to his quantitative analysis, based on data received from Russia’s official statistical sources and surveys conducted by the World Bank, Remington focuses on specific issues such as that of in-kind benefits and their replacement with monetary payments. The monetization of in-kind benefits caused an uproar among the population, with some political parties, particularly those on the left, strongly opposing this “antinational” reform.
Remington also examines the situation with wage delays, barter as a mode of exchange, and payments in produced products, all of which were typical of Russia in the 1990s. In-kind or nonmonetary social benefits fitted this picture well. The traffic in different types of manufactured articles and products along highways by individuals working in small towns and villages and receiving their salaries in kind is an example of a primitive market at its best. Essentially, nonmonetary social benefits played the role of an anesthetic during painful market reforms. In-kind benefits included, for example, free access to public transportation for people in some social categories. Such socially valued and politically attractive entitlements were typical not only of Russian regions but of Ukraine as well. In reality, it was not feasible for municipalities to pack all l’gotniki into buses, trolleybuses, and trams. Another issue was that of widespread fraud. The buying and selling of false IDs of pensioners, students, tax inspectors, and policemen in order to obtain free transport became a common practice. These were natural responses to delayed salaries, stipends, pensions, and other payments. At the same time, l’gotniki became de facto free riders.
The descriptions provided in the book are thorough and the author’s knowledge of historical facts and processes is impressive. At the same time, the critical analysis is not as elaborate as one would expect. Instead, it is substituted with simple quantitative and regression analyses. Hence, Remington’s arguments and findings are rather predictable. The author claims, for instance, that the more democratic regions are characterized by a more reliable business environment, a better investment climate, and greater protection of property rights. He arrives at the conclusion that “[t]he regions that featured a higher level of democracy and pluralism did manage the trade-off between market competition and social protection more successfully than the less democratic regions. The evidence shows that the overall earnings were higher, social dependency lower, investment higher, and corruption lower in such regions” (214).
Remington begins by describing the convergence of Russia and the United States in many respects, including that of the poverty level and the widening gap between rich and poor, and concludes with an analysis of regional inequalities. He is especially interested in tripartite agreements and commissions as a technique for configuring the relations between the state, business, and employees; bargaining power; social transfers; and issues of paternalism and neopatrimonial arrangements.
The author defines inequality in terms of income, not in terms of access. In my opinion, this approach is no longer relevant. Two aspects crucial to a consideration of inequality are missing: access to education and access to healthcare. At the same time, the author attempts to consider the causes of inequality, which compensates in part for this shortcoming. Remington attempts a macroeconomic approach and ultimately arrives at a hybrid of macroeconomic analysis and subnational politics, which, however elaborate, does not advance to the level of cohesive political economy. It follows from the book that inequality is essentially a problem of democracy and income. The book could very well be titled “The Politics of Income Inequality.” Another concern is that the author is, figuratively speaking, measuring wages rather than wealth. In a rent-oriented society such as Russia, measuring wealth may be no less important than measuring wages.
No serious research on Russia can overlook the problem of corruption, and this book is no exception. The author briefly touches on the issue of corruption several times in the course of his analysis. However, the key question—How much does corruption contribute to inequality?—is not only unanswered, but is never even asked. The author rarely mentions bribery, corruption, and the business climate, but reduces his analysis to the realm of state-business relations. He concludes by arguing that “[t]he fact that corruption is lower and investment is higher in more democratic regions is consistent with the view that more openness and transparency reduces the opportunities for governments to capture rents from enterprises” (169).
Overall, this book will be of interest to those seeking a good reading on issues of income inequality in Russia and its implications for the regions.