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Domestic and External Factors in the Development of Russia's Economic Think Tanks Sector

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BOFIT Policy Brief 2016 No. 3 Andrei Yakovlev, Lev Freinkman and Anton Zolotov Domestic and external factors in the development of Russia’s economic think tanks sector Bank of Finland, BOFIT Institute for Economies in Transition BOFIT Policy Brief Editor-in-Chief Iikka Korhonen BOFIT Policy Brief 3/2016 Andrei Yakovlev, Lev Freinkman and Anton Zolotov: Domestic and external factors in the development of Russia’s economic think tanks sector 27.4.2016 ISSN 2342-205X (online) Bank of Finland BOFIT – Institute for Economies in Transition PO Box 160 FIN-00101 Helsinki Phone: +358 10 831 2268 Fax: +358 10 831 2294 Email: [email protected] Website: www.bof.fi/bofit_en The opinions expressed in this paper are those of the authors and do not necessarily reflect the views of the Bank of Finland. Andrei Yakovlev, Lev Freinkman and Anton Zolotov Domestic and external factors in the development of Russia’s economic think tanks sector Contents 1 Abstract ................................................................................................................................................ 3 1 Introduction ................................................................................................................................... 4 2 Analytical framework ................................................................................................................... 4 3 Role of think tanks in the course of market transformation in post-socialist economies ............. 6 4 Development of Russia’s economic policy analysis sector .......................................................... 8 5 Challenges to Russia’s think tank sector since 2009 .................................................................. 12 6 ARETT: An emerging tool for collective action ........................................................................ 17 7 SЕТТ: successful international support for national-level economic policy analysis ................ 19 8 Conclusions ................................................................................................................................. 22 References .......................................................................................................................................... 24 Bank of Finland BOFIT Policy Brief 3/2016 Institute for Economies in Transition 2 www.bof.fi/bofit_en Andrei Yakovlev, Lev Freinkman and Anton Zolotov Domestic and external factors in the development of Russia’s economic think tanks sector Andrei Yakovlev, Lev Freinkman and Anton Zolotov Domestic and external factors in the development of Russia’s economic think tanks sector Abstract This paper considers the development and current state of Russia’s think tank sector. As in Eastern Europe, international technical assistance played an important in development of Russian think tanks in 1990s. However unlike Eastern Europe, especially new EU members, demand for economic policy input in Russia at the national level has remained strong. As a result, members of Russian expert community today commonly serve in government posts and act as first movers in the consensus- building process for government policy. Russia’s leading economic think tanks have organized professionally to secure a high standard of independent economic analytics and ethical behavior. In this sense, the sector seems more mature than local think tanks in Eastern Europe. While the sector today faces serious challenges from legislative changes that have largely limited the client base to government entities, the economic analysis provided by think tanks remains critical to policy-setting. The findings are based on two surveys of Russia’s leading think tanks. The surveys, conducted in 2012–2013 and 2015, are augmented with in-depth interviews with representatives of Russia’s top think tanks. Keywords: think tanks, business associations, collective actions, Russian economy, economic policy analysis, demand for independent expertise. JEL: H41, L84. Andrei Yakovlev, National Research University – Higher School of Economics (Moscow, Russia) and Association of Russian Economic Think Tanks (Moscow, Russia). Email: [email protected] Lev Freinkman, National Research University – Higher School of Economics (Moscow, Russia). Anton Zolotov, Association of Russian Economic Think Tanks (Moscow, Russia) and Institute for National Projects (Moscow, Russia). The study has been funded within the framework of the Basic Research Program for 2012–2016 at the National Research University Higher School of Economics (HSE) and by the Russian Academic Excellence Project '5-100'. We thank Victoria Golikova and Irina Mersiyanova for their contributions to the survey design and participation in field work in 2012–2013, Alexei Zudin for his participation in the analysis of in-depth interviews, Marek Dabrowski for his sharing of materials on the activity of think tanks in Eastern Europe and Denis Ivanov for estimating the spending of Russian federal authorities on economic policy research. We are also grateful for the insightful comments of Lev Jakobson, Leonid Polishchuk, Alexander Auzan, Vladimir Benevolensky, Leonid Grigoriev, and Nadezhda Kosareva to earlier drafts of this paper. We thank Ekaterina Nikolaeva for her provision of the archival reports on activities of the SETT program. Finally, we owe a special debt of gratitude to all respondents to the surveys. Bank of Finland BOFIT Policy Brief 3/2016 Institute for Economies in Transition 3 www.bof.fi/bofit_en Andrei Yakovlev, Lev Freinkman and Anton Zolotov Domestic and external factors in the development of Russia’s economic think tanks sector 1 Introduction External observers are often surprised by the vibrancy and competitive structure of Russian organizations involved with economic policy analysis. Russian think tank researchers are independent and routinely criticize the government’s economic policies. They also engage extensively in constructive cooperation with public entities to address specific economic issues. The government’s reliance on think tanks reflects informal networks that bind experts and key decision-makers within the government. It is not unusual for a senior civil servant to have also worked at some point in his or her career as a researcher or analyst at an economic think tank. Such networks – and the experience they provide – have been a powerful stabilizing factor in the economic policies of the Putin administration. In particular, think tanks mitigate the risk of catastrophic economic errors by a government otherwise prone to overlook or manipulate public opinion. This article attempts to identify the reasons for the robustness and viability of Russia’s economic think tanks. Our analysis focuses on factors, internal and external, that have enhanced sustainability of the sector for independent analytics in Russia relative to countries in Eastern Europe, including recent EU members. We give special attention to the role of the USAID program “Strengthening Economic Think Tanks” (SЕТТ), which ran from 1999 to 2009. SETT promoted institution building in the sector following the 1998 crisis, and, in our view at least, has been a major determinant of the sector’s current structure. We also offer an overview of the trends affecting Russia’s independent economic policy think tanks. We limit the analysis largely to independent think tanks specializing in policy studies that employ internationally accepted methods of economic analysis.1 To flourish, think tanks need clear segmentation of the analytics market and a pool of clients willing to pay fair value for the professional expertise they provide. To assure high quality standards are maintained, most think tanks in Russia have accepted self-regulation through collective action. We thus pay special attention to the role of the Association of Russian Economic Think Tanks (ARETT), the sector’s main professional organization. Our empirical discussion derives from two surveys of think tank leaders conducted jointly by the National Research University Higher School of Economy (NRU HSE) and ARETT. The first survey, conducted in late 2012 and early 2013, covers 46 think tanks (38 ARETT members and eight non-ARETT think tanks). The second survey, conducted in early 2015, involves 26 ARETT members. In-depth interviews with key economic experts at leading think tanks provide additional input. The article has the following structure. Section 2 lays out the analytical framework on which our analysis is based. Section 3 contains a brief overview of think tank development in Eastern Europe as a reference to trends in Russia’s think tank sector. Section 4 discusses the development of economic policy analysis in Russia since the launch of market reforms, including the key drivers of development. Section 5 identifies current challenges facing think tanks in Russia and inter-group differences within the sector. Section 6 presents ARETT and its experiences with collective projects. In Section 7, we discuss the contribution of the SETT program to the development of ARETT and the think tank sector. Section 8 concludes. 2 Analytical framework Motivation for this study was generated by our interest in clarifying the institutional conditions that support sustainable development of a think tank industry in a weak institutional setting. We consider independent analytical organizations (think tanks) as an industry with the potential to produce 1 “Policy studies” here applies to the fundamental, long-term issues of socioeconomic development of both the national economy and
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