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Working paper

Attitude to the National Leader Through the Lenses of Investment Climate Assessment: The Case of Russia

This paper considers two issues. First, it evaluates the changes in Russia’s investment climate in 2012-2014 after the announcement of an ambitious governmental program to improve the conditions for doing business. Second, because the relevant reforms were personally initiated by Vladimir Putin, we carried out a survey experiment designed to find out how references to a popular politician influence respondents’ opinions about the business climate. We used the data of a large-scale survey of top managers in Russian manufacturing sector conducted in July-October of 2014. Contrary to the World Bank report, Easy Doing Business, our empirical data shows that there was practically no improvement in the investment climate in Russia in 2012-2014. Also contrary to the results of population surveys showing extremely high public support for Vladimir Putin after Crimea’s accession to Russia, our survey experiment demonstrated that referring to the President Putin as the initiator of business climate reform improves assessments of the business climate change only slightly. However, the effect of reference to the President’s initiative differs significantly for firms from different size groups – we revealed no effect of question wording in the group of small firms, much higher share of non-answers in the group of large firms and a significant increase in the share of positive assessments of business climate among mid-size firms when Vladimir Putin was mentioned.