Abstract
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This work analyzes structure and genesis of unproductive costs, weakening of the effectiveness and efficiency of municipal administration. The main thesis is that low quality of municipal management in small towns and villages of Russia is determined by unproductive institutional costs, external to the municipality, and the situation can be described as a path-dependent. The work is an empirical study, based on rather wide material (25 municipalities, mainly in the central parts of Russia). Material was collected during field research, held by the Laboratory of municipal administration by the Faculty of Public Administration of the State University – Higher School of Economics in 2008-2010. Due to the complexity of the subject, qualitative methods are used (mainly expert survey).
Small towns (under 50K citizens) and villages of Russia suffer from a number of severe social and economic problems, such as: poor business activity, lack or unavailability of social services, mean civic engagement and so forth. Significant part of these problems is in the competence of local authorities, both according to the law and the nature of local administration. Still, it is essentially uncommon for these problems to be satisfactorily solved.
The research shows that the main cause of lower quality of municipal management is unproductive costs. Author contrasts the unproductive costs with “normal”, productive ones. “Normal” costs are indispensable in functioning of municipal administrations. On the contrary, unproductive costs exclusively deteriorate municipal management. Furthermore, as opposed to “normal” costs, unproductive ones are not inevitable. Most of these costs stem from a low quality of institutions, both formal (e.g. budget and tax codes) and informal (e.g. do-nothingism, negative attitude towards authorities). Besides, a significant part of unproductive costs is indirectly determined by institutions (e.g. bureaucratic obstacles alleviation and corruption).
The main problem of governance reformation towards elimination of institutional barriers is that societal adaptation institutes too are either defunct or sluggish. The situation is stemming from the failure of institutional transformation of the 1990s to overcome some problems peculiar to soviet period. Thus, we observe a pronounced path-dependence effect. The path, preformed mainly during the 20th century history, is channeling the development of national governance system towards greater centralization, deprivation of local authorities of initiative, managerial and political potential. This situation not only contravenes the international conventions that Russia endorsed, but also questions economic and social potential of our country.
Practical outcome of the research outlines possible ways of improving the situation considering high institutional inertia. Recommendations contain specific measures to be taken by non-governmental entities at this juncture.
The research is of primary interest to local decision makers and Russian small towns’ researchers. Nevertheless, author does not concentrate on narrowly-specialized problems, so the study can serve as a good review of Russian small towns’ problems for anyone whom it may concern.
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