Developing the Human Capital Intensive Sector in Russia: A Chance for Economic Revival?
Aug 16, 2000
Michael D. Intriligator, Serguey Braguinsky, and Vitaly Shvydko

After the breakup of the Soviet Union, Russia basically had two spheres of comparative advantage which it could use for the purpose of integrating itself successfully into the world economy. The first such sphere was represented by the resource extraction sector, or, more generally, industries with a very low share of value added in the total value of output. The second comprised those industries with a very high share of value added that were not dependent on the general state of technology or manufacturing but rather on the quality of human capital - another extremely important sphere of latent comparative advantage for Russia.

This paper examines Russia's potential for economic revival.