Russian Modernization: the problem of choosing a strategy

Modernization of the Russian economy is an obvious necessity. A number of indicators suggest that Russia is significantlylagging behind the worlds leading economies. In particular, Russia ranks 64th in the world by the level of production per workerin agriculture, 66th by production in industry and 68th by production of GDP per worker. Russias share in the global high-tech exportsis 0.27%; the share of high-tech products in Russian exports of manufactured goods is 6.5%, the 63rd place in the world. The share ofhigh-tech products of manufacturing industry in the Russian GDP is 2%. Payments to Russian owners of patents and licenses were$493,670,000 in 2009, which is almost 30 times less than in Germany, 110 times less than in the EU and 200 times less than in the U.S.The purpose of modernization proclaimed by the countrys leadership is the breakthrough of Russia to the group of countries generatingthe most modern and advanced technologies, which should identify the key characteristics of the Russian economy in the coming years.However, turning to the universal laws of economic development we are forced to conclude that the problem in hand is unlikely to besolved by the proposed method in the expected time. 1. It is well known that the adoption and development of basic innovation is cyclical,undulating pattern. This kind of cycles has been called The Kondratieff long waves. The current wave of Kondratieff cycle beganin the first half of the 1980s, and by now the new technological order has been completely formed. The expectations of any technologicalbreakthroughs in the next 20 years are quite low. 2. In the process of formation of a new technological order, a limited number ofbasic technologies are chosen from the rich bank of technical and scientific innovations in various stages of development. In our countrythe focus is put on the support for the so-called nanotechnology. However, this choice seems not very well founded, to put it mildly.There can be no assurance that these particular technologies would shape the face of the world economy during the next wave of scientificand technological revolution. 3. In presence of market economy, the economic system must be competitive and mobile in order toabsorb and generate innovations. The Russian institutional environment is far from that state. Modernization of the institutional environmentis a necessity, but it is obvious that current leadership is clearly not ready for it. Thus, the currently adopted strategy of modernizationlooks neither valid nor realistic. The catching up strategy is much more real and relevant to Russia, but it is not acceptable tothe higher echelons of power.

Keywords

Authors

References