This study focuses on the interaction of state elites and powerful interest groups in a privatized state in order to explain the economic reform process in post-soviet Russia in the 1990s and the 2000s. First, changes in the political opportunity structure of rent-seekers as a result of the 1993 constitutional crisis affected their bargaining power and caused macroeconomic policy change in Russia in 1994. Second, the Russian privatized state strengthened the concern for relative gains among and within groups, which weakened social cooperation. On account of the fragmentation of social organizations, the Russian state enhanced state autonomy to consolidate macroeconomic stabilization and to make a fiscal reform attempt in 1997. But the fiscal reform attempt unlike macroeconomic stabilization failed because of the lack of state capacity. Third, the 1998 financial crisis caused the asset property change of rent-seekers from financial to industrial capital. I argue that this increasing asset specificity improved state capacity to achieve several notable fiscal reforms in the early 2000s. The important theoretical contribution of this study is to illuminate and explain the dynamics of state power with respect to state autonomy and capacity in a relatively short-term period through the case of Russian economic reform. |