Economic and social reforms in the North Caucasus: Goals, limitations, problems, and results

Abstract

Problems regarding the development of the North Caucasus have been key issues on the agenda of federal and regional authorities for many years. Their visions of the possibilities and methods of development vary widely. Practically all regional elites place emphasis on the uniqueness of their republics, while the federal authorities, on the contrary, seek to move beyond the asymmetry of the relationships, seeing the solution to the problem as a broader use of unified and politically neutral approaches to development. This article assesses the results of administrative efforts to develop the regions of the North Caucasian Federal District. The authors focus on analyzing processes that adapt the reforms being implemented to regional specifics, as well as on the symbiosis of the results of self-organization of the population and federal and regional novations. The topics associated with management policy in the North Caucasus is preceded by a brief analysis of the region’s demographic situation, which is considered as a challenge that simultaneously creates opportunities for development and amplifies social instability. The main topics considered in the article are development strategies for the North Caucasus, “anchor” investment projects, internal resources of development (regional budgets and the shadow economy), the land question, municipal reform, and local development. It is concluded that universal mechanisms of socioeconomic development—federal subsidies, direct investments in infrastructure, and public-private partnership in large-scale projects to create new high-paying jobs—are insufficient for solving local problems. Special strategies are necessary that would involve not only investments and institutions but also measures of indirect influence based on common values.