Evaluating Agricultural Productivity and Policy in Russia

Russia's transition to a market economy in the early 1990s shocked its agricultural sector, creating the potential for profit and gains from specialisation and productivity improvements. However, subsequent regional agricultural development has been highly uneven, and the sources of the sector's productivity improvement remain unclear. Drawing on a newly‐assembled Russian regional farm production and policy dataset, we evaluate agricultural total factor productivity growth from 1994 to 2013, decomposing that growth into technical progress and efficiency gains, for the nation as a whole and for the major agricultural districts of the South and Central. We then test how investments in road and rail infrastructure and human capital have influenced those gains. The South substantially outperformed the Central district and the nation at large with respect to all three performance indicators. However, contrary to the literature, we find that these particular state policies provided no substantial growth advantages, there or elsewhere. Rather, the dominant force behind Russia's agricultural growth has been informal technical change.