Unequal effects of liberalisation on diversification of Russia's regions

In this paper we document how the unequal liberalisation of business regulation across Russia’s regions leads to varying effects on the diversification of Russia’s economy. We find that national liberalisation laws were better enforced in those regions with more transparent government. As a result, economic diversification was more marked and growth of the small business sector more significant. In contrast, in regions with less transparent government, we observe no effect of reform. Keywords: diversification, liberalisation, Russia.