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• Case | HBS Case Collection | November 2019 (Revised June 2020)

  Russia: A Drama In Three Acts

  Rawi Abdelal, Rafael Di Tella, Galit Goldstein and Sogomon Tarontsi

  The collapse of central authority in the Soviet Union in 1991 ushered in a period of revolutionary transformations for the states that emerged in its wake. The leaders of Russia, the USSR's successor, struggled to reestablish central authority while also seeking to avoid further disintegration, establish a democratic polity, and institute a market economy across the next several years. Russia would navigate further economic crisis and a swiftly evolving geopolitical order as it returned to the world stage. The case examines the different governance approaches adopted by Presidents Boris Yeltsin, Dmitry Medvedev and Vladimir Putin, and concludes with a discussion of Russia’s strategic challenges and opportunities in 2020. The case focuses on problems of state authority; fiscal capacity; institutionalization of political parties; relations between the federal center and provincial governments; relations between the state and big business; economic policy; international relations; and models of economic development.

  Keywords: Business ＆ government relations; developing countries; government policy; policy change; Policy Making; Economic Systems; Economics; Globalization; Emerging Markets; Privatization; Non-Renewable Energy; Governance; Global Strategy; Corporate Governance; Policy; Business History; Lawfulness; Problems and Challenges; Business and Government Relations; Risk and Uncertainty; Strategy; Change Management; Russia; Moscow;

  Citation:

  Abdelal, Rawi, Rafael Di Tella, Galit Goldstein, and Sogomon Tarontsi. "Russia: A Drama In Three Acts." Harvard Business School Case 720-020, November 2019. (Revised June 2020.)  View Details

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• Case | HBS Case Collection | April 2020 (Revised April 2020)

  Unrest in Chile

  Vincent Pons, William Mullins, John Masko, Annelena Lobb and Rafael Di Tella

  In 2020, Chileans would head to the ballot box to decide their country’s future. Many international observers credited Chile’s decades of neoliberal governance with turning the country into Latin America’s “Tiger,” a prosperous, diversified economy on its way to becoming the continent’s first developed country. But in October of 2019, a mass protest movement ground the country to a halt and shocked its political class, showing the world a different Chile—one defined by inequality, social distrust, and a young generation of political activists. As Chile prepared to vote in the fall of 2020 on whether to adopt a new constitution, could it sculpt a more equitable society while remaining “the exception” on a continent known for its political instability? Or would Chile’s prosperity go the same way as its neoliberal experiment?

  Keywords: Developing Countries and Economies; Macroeconomics; Economy; Political Elections; Public Opinion; Social Issues; Equality and Inequality; System Shocks; Chile; Latin America;

  Citation:

  Pons, Vincent, William Mullins, John Masko, Annelena Lobb, and Rafael Di Tella. "Unrest in Chile." Harvard Business School Case 720-033, April 2020. (Revised April 2020.)  View Details

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• Case | HBS Case Collection | July 2005 (Revised January 2020)

  The U.S. Current Account Deficit

  Laura Alfaro, Rafael Di Tella, Ingrid Vogel, Renee Kim, Sarah Jeong, Matthew Johnson and Jonathan Schlefer

  Investors and policymakers throughout the world were confronted with the risk of painful economic consequences arising from the large U.S. current account deficit. In 2007, the U.S. current account deficit was $731 billion, equivalent to 5.3% of GDP. The implications of the deficit were debated with intensity. At one extreme, it was argued that large deficits would eventually resolve themselves smoothly, even if they persisted for many more years. Former Federal Reserve Chairman Alan Greenspan was among those expecting a "benign resolution to the U.S. current account imbalance." Other analysts, such as economists at the World Bank, believed the large deficits raised the risk of a sharp and disorderly fall of the dollar and that necessary macroeconomic adjustment could be painful, for the United States as well as for the rest of the world. The Financial Times asked: "How long will foreigners be prepared to make such generous 'gifts' to the US?" In this environment, Berkshire Hathaway, run by legendary investor Warren Buffett, postulated that current account imbalances would lead to "some chaotic markets in which currency adjustments play a part" and announced to shareholders a plan to increase investment in overseas companies to protect against this risk. It remained to be seen what the short- and long-term implications of the current account deficit would ultimately yield.

  Keywords: Macroeconomics; Borrowing and Debt; Currency; Foreign Direct Investment; Business and Government Relations; United States;

  Citation:

  Alfaro, Laura, Rafael Di Tella, Ingrid Vogel, Renee Kim, Sarah Jeong, Matthew Johnson, and Jonathan Schlefer. "The U.S. Current Account Deficit." Harvard Business School Case 706-002, July 2005. (Revised January 2020.)  View Details

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