The Strategic Value Framework developed in this book explicates the dominant sectoral patterns of market governance in Russia today. Historical process tracing from sectoral origins of labor-intensive textiles and capital-intensive telecommunication in this chapter shows how Russian state leaders intersubjectively respond to objective economic and political pressures. The political basis and evolution of the perceived strategic value of national security and resource management took root in the Soviet era through Soviet collapse and transition to and away from democratic rule. In the context of macro-liberalization and mass privatization at the founding of the Russian Federation, interacting perceived strategic value and sectoral structures and organization of institutions have shaped the centralized role of the state in market coordination and variegated property rights arrangements of centralized governance in defense-origin dual use telecommunications reenforced by the rise of Vladimir Putin aided by economic and political crises. The less strategic value of non-defense sectors, such as textiles, is governed by the decentralized coordination and dominant private property of private governance and decentralized governance since Gorbachev’s perestroika. The rise of bifurcated oligarchy in Russian-style capitalism are shaped by the joined imperatives of resource security nationalism and path-dependent sectoral organization of institutions.

In parallel to the centralized governance of strategic industries in Chapter 4, the lower degree and narrower scope of the perceived strategic value of labor intensive and less value-added sectors, represented by textiles, for national security and the national technology base, has shaped decentralized governance and private governance in nonstrategic sectors. In the context of sectoral structural and organization of institutions, less concerned about controlling products or services that have few applications for national security and low contribution to the national technology base, the central state introduced competition in textiles in the 1980s and devolved market coordination of quasi-state and private ownership to local governments and commerce bureaus by the early 1990s before China’s World Trade Organization accession. The cross-time sector and company case studies reveal the interacting strategic value and sectoral logics apply at the subsector. Capital-intensive and more value-added technical textiles experience more deliberate market coordination by local governments and the central state and are characterized by mixed property rights sponsored by and connected with state-run research and development institutions. Taken together the textile industry today experiences periodic overexpansion, environmental degradation, and reactive local state interventions in response to economic reverberations and central-level environmental and developmental mandates.

This chapter shows how in parallel to the regulated governance in telecommunications uncovered in Chapter 7, the perceived strategic value of labor-intensive industries dominated by rural small-scale producers, showcased by textiles, for national self-reliance and neoliberal development, shape the centralized governance by the Indian government. The cross-time sector and company case studies reveal that at a time when centralized market coordination in labor-intensive, less value-added textiles is eliminated around the world, India created a central ministry and other sector-specific bureaucracies in textiles associated with nationalist narratives of Gandhian Swadeshi self-reliance in the 1980s following internal political and economic crises. Endowed with limited resources and regulatory capacity, the centralized governance of the textile ministry has introduced extensive competition in the neoliberal era and deliberately intervened in market developments. In addition to subsidizing industrial upgrading and deregulating market entry, business scope, and trade, the textile ministry has nationalized large-scale textile mills of the organized sector during economic slowdowns. Moreover, fiscal and protectionist trade policies have also cushioned the survival of small-scale, labor-intensive handlooms in apparel and clothing and the highly polluting power looms dominant in more capital-intensive technical textiles even as the state promotes export-oriented industrialization.

This chapter shows how the perceived strategic value of high-tech, globally integrated sectors, represented by telecommunications, for neoliberal development interacts with sectoral structures and organization of institutions. The resultant regulated governance by the Indian government of telecommunications are the micro-institutional foundations of Indian-style capitalism undergirding the globalization and development of such industries disconnected from the post-Independence legacies of the Indian nationalist imagination. The cross-time sector and company case studies show the initial introduction of competition in telecommunications occurred during Big Bang Liberalization supported by pro-liberalization industrial stakeholders disconnected from the existing telecommunications bureaucracy. Today a central-level ministry makes policy and an independent regulator enforces the market entry and business scope of a state-owned fixed-line operator and fiercely competitive mobile carriers and value-added service providers. The role of the state in market coordination and the dominant property rights arrangements vary by subsector as a function of interacting strategic value and sectoral logics. Nehruvian interpretation of Gandhian Swadeshi self-reliance has retained bureaucratic oversight of the development of state- and privately-owned equipment makers, which concentrated on rural automatic exchanges and low-tech inputs until the dominance of Chinese competition pivoted focus to indigenous development in new generation mobile consumer and terminal telecommunications equipment.

This chapter demonstrates that the lower degree of and narrower scope of the perceived strategic value of labor-intensive, non-value-added sectors, represented by textiles, for national security and resource management, has shaped their decentralization beginning under Gorbachev’s perestroika. Mass privatization after Soviet breakdown further reenforced the private governance pattern dominant in apparel and clothing. The cross-time sector and company case studies disclose the interacting strategic value and sectoral logics and show apparel and clothing factories have shut down or privatized to former managers only to languish with antiquated equipment. Today, Russian textile and garment manufacturers are outcompeted by illegal imports from China and the Commonwealth of Independent States. Industrial and technical textile sectors, which incorporate oil and petrochemicals and higher technological intensity, in contrast, experience the state intervention from central and regional governments of decentralized governance in response to political and economic pressures, such as oil boom and bust cycles and Western sanctions in post-Crimea annexation. The central government has designated petrochemicals a critical input for chemical fiber processing and provides fiscal incentives to develop technical textiles. Local governments have worked with local and national oligarchs to revive factories and production lines, and courted foreign direct investment.

Beyond macroeconomic indicators and simple observations that China, India, and Russia are large and diverse developing countries shedding socialist economies, what is often overlooked is that these countries’ development trajectories are nationally distinct and sectorally variegated. The commonality of market liberalization in the context of their global economic integration has translated into very different pathways to development, revealing stark differences in micro-institutional foundations, which vary by sector. This book unravels the puzzles with three overarching claims. First, mediating the impacts of globalization and economic liberalization on industrialization are dominant nation-specific sectoral patterns of market governance. Market governance structures comprise two dimensions (level and scope of the state in market coordination and dominant distribution of property rights arrangements). The conceptualization recognizes the various state authorities and market actors in coordination mechanisms and broadens measures of institutional quality beyond de jure private property rights and credible commitment. Second, the values and identities of national political economic elites as they respond to objective political and economic pressures internal and external in nature interact with sectoral structures and organization of institutions. The resultant national configurations of sectoral models, the third claim of the book, negotiate global economic integration with impacts on actual development outcomes.

The Strategic Value Framework introduced in this chapter offers a unified explanation, linking macro- and micro-sectoral-level changes and continuities, of what appears to be contradictory and irreconcilable forces at work within globalizing countries. It first identifies historically and institutionally rooted values, objective and intersubjective in nature, which arise from state elite responses to political and economic pressures internal and external in nature experienced during significant moments of national consolidation. The perceived strategic value orientation evolves and transforms overtime; and interacts with sectoral structures and organization of institutions. The resultant dominant patterns of market governance vary by country and sector within country and filter the relative impacts of an open economy, global norms and international organizations, resource and factor endowments, regime type and political institutions, and national characteristics and domestic structures. The Strategic Value Framework is tested and substantiated with a multilevel comparative case research design, which systematically conducts across case and within case analysis at (time, country, sector, and company). The case studies leverage historical process-tracing and triangulation of qualitative and quantitative data, including in-depth interviews with state, subnational government, business, and industry stakeholders and primary and secondary documentation collected during extensive fieldwork.

This concluding chapter assesses the Strategic Value Framework for understanding the nonlinear and multidimensional nature of national sector-specific market pathways to development contrary to the expectations about the effects of open economy politics and regime type for particular modes of state-market interactions. The national configurations of sectoral models bridge different scholastic traditions in varieties of capitalism on the interactions between company-level and national-level characteristics and hierarchical state-business relations. Sector-specific dynamics emanating nation-specific sectoral pathways uncover how perceived strategic value and sectoral structures and organization institutions interact to affect how multinational and domestic companies alike experience the emergent institutional foundations of capitalism. This chapter further demonstrates how the new capitalisms play out in other strategic and non-strategic sectors in China, India, and Russia. The book concludes with analyzing the macro effects of the micro-institutional foundations on global conflict and cooperation—from trade wars and cross-border cybersecurity to the Covid-19 global pandemic. The analytical leverage of the Strategic Value Framework in identifying national sector-specific patterns of market governance sheds light on the politics of the management of the Covid-19 pandemic and how they varied across countries and industries within them.