OECD Economics Department Working Papers

Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.

The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.

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Russian Manufacturing and the Threat of ‘Dutch Disease'

A Comparison of Competitiveness Developments in Russian and Ukrainian Industry

This paper examines the development of Russian industry in comparison with that of Ukrainian industry during 1995–2004 in an effort to ascertain to what extent, if any, Russian manufacturing showed signs of succumbing to ‘Dutch disease’. Ukraine and Russia began the market transition with broadly similar institutions, industrial structures and levels of technology, and the economic reforms implemented in the two countries were also similar, although Ukraine was reckoned to lag behind Russia in many areas. The main difference between them is Russia’s far greater resource wealth. It follows that differences in industrial development since 1991 may to some degree be attributable to differences in initial natural resource endowments. In short, Ukraine could provide a rough approximation of how a resource-poor Russia might have developed over the transition.


Keywords: unit labour costs, natural resources, restructuring, competitiveness, industry, productivity, revealed comparative advantage, transition, wages, oil, Russia, Ukraine, gas, dutch disease
JEL: P23: Economic Systems / Socialist Systems and Transitional Economies / Socialist Systems and Transitional Economies: Factor and Product Markets; Industry Studies; Population; P27: Economic Systems / Socialist Systems and Transitional Economies / Socialist Systems and Transitional Economies: Performance and Prospects; O57: Economic Development, Innovation, Technological Change, and Growth / Economywide Country Studies / Comparative Studies of Countries; J24: Labor and Demographic Economics / Demand and Supply of Labor / Human Capital; Skills; Occupational Choice; Labor Productivity; Q33: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Nonrenewable Resources and Conservation / Resource Booms; L60: Industrial Organization / Industry Studies: Manufacturing / Industry Studies: Manufacturing: General
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