ABSTRACT
Since the end of the Cold War and Russia’s integration into the world economy, the conditions that determine a global crisis affecting the country’s economy have changed dramatically. When Russia was enclosed in a rigid and isolated socialist system, it felt few effects from the frequent cyclical turbulence in the capitalist world. Russia’s resource wealth added to the short-lived popularity of the Soviet Union and the model of a centrally planned economy, since during the shocks of the mid and late 1970s, neither the Soviet Union nor its allies experienced the problems that hit the liberal capitalist economies of the West. However, that central planning led to long-term disadvantages for the USSR and the whole post-Soviet region. Those countries were not induced by market forces to move away from extensive development. They did not develop energy-efficient and energy-saving technologies, and they were left far behind those countries that were experiencing the vulnerability of those times. The Soviet bloc remained untouched by the economic instability of the period. As a result of short-term thinking and deception, those within the socialist bloc believed that the Soviet-style economy could be more efficient and protective. The USSR also had a huge inflow of petrodollars, which were not used to best economic advantage. When that flow was suddenly interrupted, the economy had no safety cushion and became obsolete. This, along with other factors, led to the collapse of the whole socialist system.
