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Regular version of the site

Article

Accelerated Development of the Russian Far East: A View through the New International Trade Theory and New Economic Geography

Russia in Global Affairs. 2018. Vol. 16. No. 3. P. 110-129.

The development of the Russian Far East, which has been declared by President Putin a “national priority for the 21st century” has so far not fully lived up to expectations. The key problem is that numerous tools for an accelerated development of the region are used without a clear idea of what its future should be like and without an analysis of its competitive advantages and factors that restrain economic growth. This article analyzes these advantages and restraints through the lens of the new international trade theory and new economic geography. The focus is on economies of scale, the use of the advantages of which is a prerequisite for the competitiveness of companies producing manufactured goods. According to these theories, the main obstacles to accelerated growth in the Russian Far East are the insufficient size of the market and the continuous population distribution pattern, a Soviet legacy which makes it impossible to use the benefits of agglomeration.