The modernization of Russian society and the transition to a market economy has changed the nature of the problems of social development and employment in different regions of Russia. Regional differences are generated by various factors. Some of these are the result of economic activity, including the free market and free competition. Others are tied in with a series of cultural and ethnic problems, such as some groups being drawn more towards a European culture, while others are drawn to the Asiatic culture. This may help or hinder the regions ability to cope with the modernization of Russia. This is a presentation of the results of a study on work and welfare in Russia, that began in December 1994. The study covers many topics such as poverty, employment or lack of, education, gender, and food consumption, in three areas of Russia: Moscow, St Petersburg and Voronezh.
Institutions affect investment decisions, including investments in human capital. Hence institutions are relevant for the allocation of talent. Good market-supporting institutions attract talent to productive value-creating activities, whereas poor ones raise the appeal of rent-seeking. We propose a theoretical model that predicts that more talented individuals are particularly sensitive in their career choices to the quality of institutions, and test these predictions on a sample of around 95 countries of the world. We find a strong positive association between the quality of institutions and graduation of college and university students in science, and an even stronger negative correlation with graduation in law. Our findings are robust to various specifications of empirical models, including smaller samples of former colonies and transition countries. The quality of human capital makes the distinction between educational choices under strong and weak institutions particularly sharp. We show that the allocation of talent is an important link between institutions and growth.