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Breaking the Unbreakable Union: Nationalism, Disintegration and the Soviet Economic Collapse

Marvin Suesse

Economic Journal, 2018, vol. 128, issue 615, 2933-2967

Abstract: This article investigates the effect of prospective secessions on economic integration and growth by examining the break‐up of the Soviet Union in the late 1980s and early 1990s. Firstly, I show theoretically how regional elites had an incentive to restrict domestic trade once secession from the Union became possible. Secondly, I show empirically that the increased likelihood of secessions by the Union's member republics strongly cut domestic trade. Thirdly, I show how this explains the severity of the Soviet output fall. These patterns persist once I instrument for prospective secessions with nationalist agendas that are exogenous to trade or growth.

Date: 2018
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Citations: View citations in EconPapers (17)

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https://doi.org/10.1111/ecoj.12564

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Economic Journal is currently edited by Estelle Cantillon, Martin Cripps, Andrea Galeotti, Morten Ravn, Kjell G. Salvanes, Frederic Vermeulen, Hans-Joachim Voth and Rachel Kranton

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