Center for American Progress

Help Russia Develop a “Contract-Intensive” Economy
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Help Russia Develop a “Contract-Intensive” Economy

Nations with “contract-intensive” economies, in which individuals have opportunities to participate in the market, are less likely to engage each other in fatal conflicts than democracies that lack such economies.

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The causal linkage among prosperity, a free market, and a more democratic political system is disputed, but there at least is a link between free-market economies and global security. Nations with “contract-intensive” economies, in which individuals have opportunities to participate in the market, are less likely to engage each other in fatal conflicts than democracies that lack such economies. There were no such conflicts among the former in the period 1965 to 2001, while there were several among the latter.

That’s one reason why integrating Russia into the global economic system is key to U.S. interests. Many analysts and policymakers have supported what might be called a policy of “neocontainment,” arguing that Russia attempts to use its economic might as a foreign policy tool, and that the United States should deprive Russia of this tool by isolating it economically. But an approach of “principled integration” would allow us to shape Russia’s behavior in international affairs and to encourage political and economic reform there. Principled integration would mean increasing trade and involvement with Russia while refusing to compromise on issues like transparent business structures and requirements for entry into international institutions.

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