Russian agrarian reform and rural capitalism reconsidered

Abstract

Since 1990, significant institutional and policy change has occurred in the Russian agrarian sector. A crucial question is whether these changes will facilitate rural capitalism and the emergence of a rural bourgeoisie. This article examines Russian domestic economic policies and international trade policies, arguing that macroeconomic policies are inherently detrimental to the agrarian sector, are undermining the prospects for capitalism and the rise of a rural bourgeoisie, and are hindering economic growth. Since the onset of agrarian reform, financial and material investments into agriculture have been slashed. Russia has also pursued an open trade policy which has witnessed an increase in food imports which pits higher priced domestic food against lower priced, better quality imports. As a consequence the agricultural sector is not fulfilling basic requirements for economic growth. Based on these trends, the article concludes that current prospects for the development of a rural bourgeoisie are not favourable.