(Kuchins, 2006). Although it can be debated whether or not Russia’s political ambitions are imperial (Applebaum, 2008; Shevarnadze, 2009), it is generally clear that Russia is seeking to restore its past role as a major geopolitical force. One very important feature of this strategy is for Russia to become a global energy supplier, or “energy superpower.” Russia is eager to control the Western energy supply and leverage that power as a bargaining chip to advance national interests (HJS, 2008; Mityaev, 2009). This stance was recently made evident when it was reported that the leader of a Russian expedition to the Arctic claimed extensive rights to parts of the North Pole with major implications for the exploitation of energy resources (Zarakhovich, 2007). Although Moscow later distanced itself from these territorial claims, the fact that the Russians successfully completed a submersible journey at 14,000 feet beneath the Arctic ice emphasizes Russia’s determination and technical capabilities. The goal of becoming an energy superpower is also supported by Russia’s ambitious plans for a massive expansion of its nuclear power industry (Daly, 2009).

The Russian economy grew an average of more than 7 percent annually between 1998 and 2008 (Curtis, 1996). However, most of Russia’s recent economic success has been based on an excessive exploitation of its rich natural resources (e.g., oil and gas). Russia has more proven natural gas reserves than any other country, and it is the second largest oil exporter in the world (CRS, 2007). However, dependence on these commodity resources has in turn made Russia highly dependent on global prices (EIA, 2008). Most of Russia’s proven oil reserves are located in very remote regions such as Western Siberia, between the Ural Mountains and the Central Siberian Plateau, as well as on Sakhalin Island in the far eastern region of the country. Transportation of energy and the relatively high cost of energy production, exacerbated by aging and outdated infrastructure, present significant challenges. Russia has failed to become competitive in sectors of the economy that extend beyond the export of primary goods, such as the manufacturing sector. For example, productivity in manufacturing is only 50 percent of that of Poland and 40 percent of that of Brazil (Goldberg and Desai, 2006).

Other important factors hindering Russia’s economic progress are corruption, bureaucracy, and the lack of political transparency. All of these have a paralyzing effect on private and especially foreign investments. In almost any survey assessing fraud and political bribery, Russia can be found on the top of the list (PWC, 2009). In the most recent report by the World Trade Organization on global competitiveness, Russia was ranked 63rd out of 133 countries (World Economic Forum, 2009). Russia has the lowest score on global competitiveness among the BRIC countries (Brazil, Russia, India, and China) and fares especially badly on transparency of government policymaking and the burden of governmental regulation. Significant problems also exist with regard to property rights, real estate transactions, and land privatization.

Russia inherited a high-quality education system from the Soviet Union. Despite growing challenges since the breakup of the Soviet empire, the system has remained very good, producing a literacy rate of 99 percent (Data360, 2006). Education—especially higher education—is highly valued in Russian society (Eklof, 1996; MES, 2004). The Russian constitution grants the right to free basic education but access is provided on a competitive basis. More than 50 percent of the Russian population has a higher education, compared with 24 percent of the American population (Bauman and Graf, 2003).

Russian higher education is offered in three different ways (Johnstone, 2008). Universities (e.g., Moscow State University, Saint Petersburg State University, Moscow Institute of Physics and Technology, and Rostov State University) cover the broadest spectrum of disciplines, combining undergraduate and graduate teaching and research. Academies focus on a few selective branches of science (e.g., Academy of Mining, Academy of Architecture, Academy of Arts, and Academy of Sciences). Finally, institutes, which can be independent but are generally publicly owned, offer several professional education and selective research programs. Historically, the bulk of S&T research in Russia is conducted by the academies and institutes with minor research work at universities, which is in stark contrast with the U.S. system where the best researchers are not shielded from the “bubbling fervor of undergraduates” (Graham, 2010). Russia has a long and distinguished history in basic science. It has gained a global reputation with institutions such as the Russian Academy of Sciences and prides itself of its Nobel laureates in the sciences, especially in physics. Russia scores very well on certain Organisation of Economic Co-operation and Development (OECD) metrics (such as quality of its scientific research institutions, numbers of researchers, or numbers of science and engineering degrees), but it does very poorly on metrics of innovation output (INSEAD,



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