The state remains as important to Russia's prospects as ever. This is so t only because, as in any society, an effectively functioning state administration is necessary to the proper functioning of a complex ecomy and legal system, but also because, in Russian circumstances, factors of ecomic geography tend to increase costs of production compared to the rest of the world. These mutually reinforcing factors include: the extreme severity of the climate, the immense distances to be covered, the dislocation between (European) population centers and (Siberian) natural resource centers, and the inevitable predominance of relatively costly land transportation over sea-borne transportation. As a result, it is questionable whether Russia can exist as a world civilization under predominantly liberal ecomic circumstances: in a unified liberal global capital market, large-scale private direct capital investment will t be directed to massive, outdoor infrastructure projects typical of state investment in the Soviet period.
Allen C. Lynch is the Director of the Center for Russian and East European Studies and Hugh S. & Winifred B. Cumming Memorial Professor of International Affairs at the University of Virginia. He is the author of numerous books, including The Soviet Study of International Relations (Cambridge University Press, 1987), which was the winner of the 1988 Marshall D. Shulman Award of the American Association for the Advancement of Slavic Studies and The Cold War is Over-Again (Westview Press, 1992). He is also the author of numerous articles on Russian and Slavic studies.