The Russian Economy has evolved into a hybrid form, a partially monetized quasi-market system that has been called the virtual economy. In the virtual economy, barter and non-monetary transactions play a key role in transferring value from productive activities to the loss-making sectors of the economy. We show how this transfer takes place, and how it can be consistent with the incentives of economic agents. We analyze a simple partial-equilibrium model of the virtual economy, and show how it might prove an obstacle to industrial restructuring and hence marketizing transition.
|Original language||English (US)|
|Number of pages||30|
|Journal||Review of Economic Design|
|State||Published - 2001|
All Science Journal Classification (ASJC) codes
- Economics, Econometrics and Finance(all)