The nineteenth century: Imperial Russia
The imprint of political power on the Russian economy is significant during the whole nineteenth century. The Tsars wanted at the same time to maintain the autocracy, which implied status quo policies, and to fight on equal terms with the other European powers, which implied major reforms of the economy and consequently of the whole society.
Within this dilemma, nineteenth-century tsarist policies look like political business cycles measuring conservatism and reform. The general trend, however, is characterised by an accumulation of reforms. The reign of Alexander I (1801—25) started with a relative burst of liberalism. He was replaced by Nicholas I (1825—55), who inaugurated his reign by the suppression, through bloodshed, of the Decembrist revolt in 1825. Meanwhile, during half a century, the Russian economy was kept unchanged.In contrast, the reign of Alexander II (1855—81) was decisive as an attempt to modernise both society and its economy. The most important reforms were: the abolition of serfdom (1861), the establishment of local governmental bodies (zemstva, 1864), a judiciary reform (1864), the establishment of municipal dumas (1870) and various measures to boost industrialisation and the railway network. The reforms of Alexander II were driven less by the desire to meet the growing demand of radical factions of society than by the fear of social unrest, and the recognition of the backward state of Russia after the military disappointment of the Crimean war. And indeed, Alexander II's reforms were clearly not enough to answer the aspirations of the society. After several miscarried attempts, the Tsar Alexander II was assassinated in 1881. The reign of Alexander III (1881—94) was characterised by a return to authoritarianism, with measures specifically aimed at fighting terrorism and strengthening the autocracy (creation of the okhrana, the political police and the re-establishment of precautionary censorship).
It marked a break in the reforms. The last Tsar, Nicholas II (1894—1917), initiated numerous reforms, often as a response to the troubles of the time. In particular, his ministers S.Yu. Witte and Stolypin conducted reforms to modernise and boost, respectively, industry and agriculture.Within this political landscape, political economy flourished when it could, at the whim of censorship. At the beginning of the nineteenth century, for instance, there was a fad for Smith. The ideas of the classical school were dominant. There were fewer economic discourses up until 1870. From the 1870s onward, stimulated by the reforms, economists and publicists acknowledged the reception of several foreign currents: Marxism (especially by N.I. Ziber, among the first readers of K. Marx, and G.V. Plekhanov) and the German Historical Schools (I.K. Babst, A.I. Chuprov). After a time of assimilation of these theories, the 1890s inaugurated what was called the ‘golden age of Russian political economy'. Russian revisionism in Marxism (i.e. Legal Marxism) was stimulated by the import of neo-Kantian philosophy and of Austrian marginalism (P.B. Struve, M.I. Tugan-Baranovsky, S.N. Bulgakov).
Mathematical economics developed often with a Walrasian inspiration (V.K. Dmitriev, E.E. Slutsky, N.N. Shaposhnikov, L.N. Yurovsky). The theory of probability entered in statistics thanks to economists (Yu.E. Yanson, A.A. Chuprov, L. von Bortkiewicz). F. List was invoked in tariff issues (Witte, D.I. Mendeleev). But, more crucial for the Tsarist economy, on the practical issue, i.e. the economic development of Russia (and its sub-issues: industrialisation, reforms in agriculture, the role devoted to the obshchina, capitalism versus socialism, etc.), two main camps confronted each other: the Populists and the Marxists.
The Populists (narodniki) were a considerable social movement born in the 1870s. They inherited a Slavophile heritage, which implied a faith in the obshchina and in the Russian muzhik (peasant), and a rejection of the Western path of development (industrialisation and capitalism).
Their master philosopher was Chernyshevsky, supplemented by Marx's critique of capitalism. The movement was very broad, from very conservative to socialist, revolutionary and terrorist members. The most famous economists in the movement were V.P. Vorontsov and Nikolai- on (i.e. Danielson, the translator of Marx in Russia). Populists theorised the possibility for Russia to jump from archaic communism to the higher agrarian socialist stage, without having to cross ‘painful' capitalism. This argument was strongly disputed in the 1890s by the Marxists, which were also a broad movement. Almost every anti-Populist was a Marxist. It included the future Bolsheviks (V.I. Lenin) and Mensheviks, Liberal authors and all those who believed in the ineluctability of capitalism in Tsarist Russia. Marx found as nowhere else such a remarkable circle of followers. There were of course other movements besides Populists and Marxists: anarchists, liberals, followers of early French socialists, etc. And the influence of the German Historical School was colossal. In order to give a picture of turn of the twentieth century Russian economists, here are two examples: A.I. Chuprov and Tugan-Baranovsky.A.I. Chuprov (1842—1908) was perhaps the most characteristic Russian economist of his time. A student and follower of Babst (the translator of W. Roscher in Russia and thus a bringer of the German Historical School to Russia), he was professor of political economy at the University of Moscow, where his manual of political economy was used by several generations of students. At the same time, Chuprov adopted Marx's theory of value, was an active promoter of zemstvo statistics and had sympathies with the Populists' doctrines. Chuprov's example does not suggest that all Russian economists were historicists, but most of them shared a historical approach.
Tugan-Baranovsky (1865—1919) was a socialist economist. He had special connections with both Ukraine and Russia: born in Ukraine, he studied first in St.
Petersburg in the 1880s, but was then exiled in Kharkov in Ukraine, where he pursued his studies. He further studied in Moscow in the 1890s, and taught in St. Petersburg from the mid-1890s. He was once again exiled in Ukraine at the beginning of the twentieth century. Back in St. Petersburg in 1905, he left Russia finally in 1917 for the nascent independent Ukraine. Fascinated by Marx, I. Kant and by the marginalist school, he made path-breaking contributions combining historical research with highly theoretical constructions (he was the first to make an analytic use of Marx's schemes of reproduction and later to suggest market socialism).He also contributed to revision of Marxism with a synthesis in value theory, combining a labour theory of value with a marginalist theory of price (see Allisson, 2012). He worked on the history of Russian industry, on socialism, cooperatives and monetary circulation. But he is world-renowned for his theory of business cycles developed in his 1894 masterpiece Industrial Crises in Contemporary England, their Causes and Influence on National Life. In this theory, crises occur endogenously because of disproportions in branches of production, and their recurrence as phases of the business cycles is explained by fluctuations in free loanable capital. On this latter point, his influence on Western business cycles theorists (A. Spiethoff, A. Aftalion, J.A. Schumpeter, W.C. Mitchell, D.H. Robertson, J.M. Keynes) was important. And in Russia and Ukraine, Tugan-Baranovsky's influence on economists active under the New Economic Policy (NEP) was tremendous.