Encyclopedia of Russian History

by James Millar

  HANSEATIC LEAGUE

  in Russia and the Soviet Union 4:97-102. Gulf Breeze, FL: Academic International Press.

  GAIL LENHOFF

  HAGUE PEACE CONFERENCES

  Tsar Nicholas II summoned peace conferences at The Hague in the Netherlands in 1899 and 1907. His gestures appealed to pacifist sentiments in the West, but his primary motives were quite pragmatic. He hoped the 1899 conference would ban the rapid-fire artillery being developed by Austria-Hungary, Russia’s rival in the Balkans. Russia could neither develop nor purchase such weapons except at great expense. Finance Minister Serge Witte urged that such money be spent instead on modernizing Russia’s economy. Having called the conference, the Imperial government found itself tied in knots. Its war minister warned that Russia would need more and better arms to achieve its goals in the Far East against Japan and in the Black Sea region against Ottoman Turkey. Russia’s major ally, France, objected to any limitations because it sought new arms to cope with Germany. Before the conference even opened, St. Petersburg assured Paris that no disarmament measures would be adopted.

  The 1899 Hague Conference did not limit arms, but it did refine the laws of war, including the rights of neutrals. It also established an international panel of arbiters available to hear cases put before it by disputing nations.

  A second Hague conference was planned five years after the first, but did not convene then because Russia was fighting Japan. Nicholas did summon the meeting in 1907, after Russia began to recover from its defeat by Japan and from its own 1905 revolution. It was during the 1905 upheaval that Vladimir Ilich Lenin first articulated his view on disarmament. The revolutionary task, he said, is not to talk about disarmament (razoruzhenie) but to disarm (obezoruzhit’) the ruling classes.

  The Russian delegation in 1907 proposed less sweeping limits on armaments than in 1899. However, when some governments proposed a five-year ban on dirigibles, Russia called for a permanent ban. Nothing came of these proposals, and the second Hague conference managed only to add to refinements to the laws of war. See also: LENIN, VLADIMIR ILICH; NICHOLAS II

  BIBLIOGRAPHY

  Clemens, Walter C., Jr. “Nicholas II to SALT II: Change and Continuity in East-West Diplomacy.” International Affairs 3 (July 1973):385-401. Rosenne, Shabtai, comp. (2001). The Hague Peace Conferences of 1899 and 1907 and International Arbitration: Reports and Documents. The Hague: T.M.C. Asser. Van den Dungen, Peter. (1983) The Making of Peace: Jean de Bloch and the First Hague Peace Conference. Los Angeles: Center for the Study of Armament and Disarmament, California State University.

  WALTER C. CLEMENS, JR.

  HANSEATIC LEAGUE

  The Hanseatic League was an association of north European towns that dominated trade from London in the west to Flanders, Scandinavia, Germanic Baltic towns, and Novgorod in the east. There is no precise date for the beginning of the Hansa, but during the twelfth century German merchants established a commercial center at Visby on the island of Gotland, and by the early thirteenth century founded Riga, Reval (Tallinn), Danzig (Gdansk), and Dorpat (Tartu).

  German and Scandinavian merchants established the Gothic Yard (Gotsky dvor) and the Church of St. Olaf on Novgorod’s Trading Side. Toward the end of the twelfth century, L?beck built the German Yard (Nemestsky dvor, or Peterhof for the Church of St. Peter) near the Gothic Yard. At the same time Novgorodian merchants frequented Visby, Sweden, Denmark, and L?beck.

  During the thirteenth century L?beck gradually replaced Visby as the commercial center of the League, and during the fourteenth century the Gothic Yard became attached to Peterhof. In 1265 the north German towns accepted the “law of L?beck” and agreed for the common defense of the towns. The League’s primary concern was to ensure open sea-lanes and the safety of its ships from piracy. In addition to Novgorod, the League founded counters or factories in Bruges, London, and Bergen. At its height between the 1350s and 1370s, the League consisted of seventy or more towns; perhaps thirty additional towns were loosely associated with the Hansa. The cities met irregularly in a diet (or Hansetage) but never developed a central political body or common navy. The League could threaten to exclude recalcitrant towns from its trade.

  HARD BUDGET CONSTRAINTS

  A Novgorod-Hansa agreement of 1269 laid the basic structure of commercial relations. German and Scandinavian merchants from L?beck, Reval, Riga, and Dorpat traveled twice per year, in summer and winter, to Novgorod. German merchants were under their own jurisdiction within Peterhof, but disputes involving Novgorodians fell to a joint court that included the mayor and chiliarch (military commander). During the thirteenth century the German Yard elected its own aldermen, but during the fourteenth century L?beck and Visby chose the aldermen. During the fifteenth century the Livonian towns selected a permanent official who resided in Novgorod.

  Novgorod supplied the Hansa with furs, wax, and honey, and received silver ingots (the source of much of medieval Rus’s silver), as well as Flemish cloth, salt, herring, other manufactured goods, and occasionally grain. In 1369 the League imposed duties on its silver exports to Novgorod; in 1373 it halted silver exports for two years, and in 1388 for four years. Novgorod turned to the Teutonic Order for silver, but exports stopped after 1427. During the 1440s war broke out between Novgorod and the Teutonic Order and the League, closing the German Yard from 1443 to 1448.

  Novgorod’s fur trade declined in the second half of the fifteenth century. After conquering Novgorod in 1478, Moscow closed the German Yard in 1494. The Yard reopened in 1514, but Moscow developed alternative trading routes through Ivangorod, Pskov, Narva, Dorpat, and Smolensk. During the sixteenth century Dutch and English traders further undermined the League’s commercial monopolies. In 1555 the English obtained duty-free privileges to trade manufactured goods for Russian furs. See also: FOREIGN TRADE; GERMANY, RELATIONS WITH; NOVGOROD THE GREAT

  BIBLIOGRAPHY

  Dollinger, Philippe. (1970). The German Hansa, tr. D. S. Ault. Stanford, CA: Stanford University Press. the sales of their product or from other financial sources. In the short term, firms facing hard budget constraints may borrow to cover their operating costs. In the long term, however, if firms cannot cover their costs from their revenues, they fail, which means they must declare that the company is bankrupt or they must sell their assets to another firm. Hard budget constraints coincide with a situation where government authorities do not bail out or subsidize poorly performing or loss-making firms.

  Soviet industrial enterprises did not face hard budget constraints. Unlike their counterparts in market economies, Soviet firms’ primary objective was to produce output, not to make a profit. In many respects, planners controlled the financial performance of firms, because planners set the prices of labor, energy, and other material inputs used by the firm and also set the prices on products sold by the firm. Centrally determined prices in the Soviet economy did not facilitate an accurate calculation of costs, because they were not based on considerations of scarcity or efficient resource utilization. Nor did prices reflect demand conditions. Consequently, Soviet firms were not able to accurately calculate their financial condition in terms that would be appropriate in a market economy. More importantly, however, Soviet planners rewarded the fulfillment of output targets with large monetary bonuses and continually pressured Soviet industrial enterprises to produce more. With quantity targets given highest priority, managers of Soviet firms were not concerned with costs, nor were they faced with bankruptcy if they engaged in ongoing loss-making activities. Without the constraint to minimize or reduce costs, and given the emphasis on fulfilling or expanding output targets, Soviet firms were encouraged to continually demand additional resources in order to increase their production. In contrast to hard budget constraints faced by profit-maximizing firms in market economies, Soviet industrial enterprises faced soft budget constraints. See also: NEW ECONOMIC POLICY; VALUE SUBTRACTION; VIRTUAL ECONOMY

  LAWRENCE N. LANGER

  HARD BUDGET CONSTRAINTS

  In
market economies, firms face hard budget constraints. This means that they must cover their costs of production using revenues generated either from

  BIBLIOGRAPHY

  Kornai, Janos. (1986). Contradictions and Dilemmas: Studies on the Socialist Economy and Society, tr. Ilona Lukacs, et al. Cambridge, MA: MIT Press. Kornai, Janos. (1992). The Socialist System: The Political Economy of Communism. Princeton, NJ: Princeton University Press.

  SUSAN J. LINZ

  HEALTH CARE SERVICES, IMPERIAL

  HAYEK, FRIEDRICH

  (1899-1992), leading proponent of markets as an evolutionary solution to complex social coordination problems.

  One of the leaders of the Austrian school of economics in the twentieth century, Friedrich Hayek received the Nobel Memorial Prize in Economic Science in 1974. Born to a distinguished family of Viennese intellectuals, he attended the University of Vienna, earning doctorates in law and economics in 1921 and 1923. He became a participant in Ludwig von Mises’s private economics seminar and was greatly influenced by von Mises’s treatise on socialism and his argument about the impossibility of economic rationality under socialism due to the absence of private property and markets in the means of production. Hayek developed a theory of credit-driven business cycles, discussed in his books Prices and Production (1931) and Monetary Theory and the Trade Cycle (1933). As a result he was offered a lectureship, and then the Tooke Chair in Economics and Statistics at the London School of Economics and Politics (LSE) in 1931. There he worked on developing an alternative analysis to the nascent Keynesian economic system, which he published in The Pure Theory of Capital in 1941, by which point the Keynesian macro model had already become the accepted and dominant paradigm of economic analysis.

  In the 1930s and 1940s, Hayek made his major contribution to the analysis of economic systems, pointing out the role of markets and the price system in distilling, aggregating, and disseminating usable specific knowledge among participants in the economy. The role of markets as an efficient discovery procedure, generating a spontaneous order in the flux of changing and unknowable specific circumstances and preferences, was emphasized in his “Economics and Knowledge” (1937), “The Use of Knowledge in Society” (1945), and Individualism and Economic Order (1948). These arguments provided a fundamental critique of the possibility of efficient economic planning and an efficient socialist system, refining and redirecting the earlier Austrian critique of von Mises. They have also provided the basis for a substantial theoretical literature on the role of prices as a conveyor of information, and for the revival of non-socialist economic thought in the final days of the Soviet Union.

  Hayek worked at LSE until 1950 when he moved to Chicago, joining the Committee of Social Thought at the University of Chicago. There Hayek moved beyond economic to largely social and philosophic-historical analysis. His major works in these areas include his most famous defense of private property and decentralized markets, The Road to Serfdom (1944), New Studies in Philosophy, Politics and Economics (1978), and the compilation The Fatal Conceit: The Errors of Socialism (1988). These works, more than his economic studies, provided much of the intellectual inspiration and substance behind the anti-Communist and economic liberal movements in eastern Europe and the Soviet Union in the 1980s and 1990s. In 1962 Hayek left Chicago for the University of Freiburg in Germany, and subsequently for Salzburg, where he spent the rest of his life. The Nobel Prize in 1974 significantly raised interest in his work and in Austrian economics. See also: LIBERALISM; SOCIALISM

  BIBLIOGRAPHY

  Bergson, Abram. (1948). “Socialist Economics.” In A Survey of Contemporary Economics, ed. H. S. Ellis. Home-wood, IL: Irwin. Blaug, Mark. (1993). “Hayek Revisited.” Critical Review 7(1):51-60. Caldwell, Bruce. (1997). “Hayek and Socialism.” Journal of Economic Literature, 35(4):1856-1890. Foss, Nicolai J. (1994). The Austrian School and Modern Economics: A Reassessment. Copenhagen, Denmark: Handelshojskolens Forlag. Lavoie, Don. (1985). Rivalry and Central Planning: The Socialist Calculation Debate Reconsidered. Cambridge, UK: Cambridge University Press. Machlup, Fritz. (1976). “Hayek’s Contributions to Economics.” In Buckley, William F., et al., Essays on Hayek, ed. Fritz Machlup. Hillsdale, MI: Hillsdale College Press. O’Driscoll, Gerald P. (1977). Economics as a Coordination Problem: The Contribution of Friedrich A. Hayek. Kansas City: Sheed, Andrews and McMeel.

  RICHARD E. ERICSON

  HEALTH CARE SERVICES, IMPERIAL

  Prior to the reign of Peter the Great there were virtually no modern physicians or medical programs in Russia. The handful of foreign physicians employed by the Aptekarskyi prikaz (Apothecary buHEALTH CARE SERVICES, IMPERIAL reau) cared almost exclusively for the ruling family and the court. Peter himself took a serious interest in medicine, including techniques of surgery and dentistry. His expansion of medical services and medical practitioners focused on the armed forces, but his reformist vision embodied an explicit concern for the broader public health.

  As of 1800 there were still only about five hundred physicians in the empire, almost all of them foreigners who had trained abroad. During the eighteenth century schools in Russian hospitals provided a growing number of Russians with limited training as surgeons or surgeons’ assistants. The serious training of physicians in Russia itself began in the 1790s at the medical faculty of Moscow University and in medical-surgical academies in Moscow and St. Petersburg. Later these were joined by medical faculties at universities in St. Petersburg, Dorpat, Kazan, and elsewhere. The early medical corps in Russia also included auxiliary medical personnel such as feldshers (physicians’ assistants), midwives, barbers, bonesetters, and vaccinators. Much of the population relied upon traditional healers and midwives well into the twentieth century.

  Catherine the Great made highly visible efforts to improve public health. In 1763 she created a medical college to oversee medical affairs. She had herself and her children inoculated against smallpox in 1768 and sponsored broader vaccination programs. She established foundling homes, an obstetric institute in St. Petersburg, and several large hospitals in the capitals. Her provincial reform of 1775 created Boards of Public Welfare, which built provincial hospitals, insane asylums, and almshouses. In 1797, under Paul I, provincial medical boards assumed control of medicine at the provincial level, and municipal authorities took over Catherine’s Boards of Public Welfare. With the establishment of ministries in 1803, the Medical College was folded into the Ministry of Internal Affairs and its Medical Department.

  The paucity of medical personnel made it difficult to provide modern medical care for a widely dispersed peasantry that constituted over eighty percent of the population. During the 1840s the Ministry of State Domains and the Office of Crown Properties initiated rural medical programs for the state and crown peasants. The most impressive advances in rural medicine were accomplished by zemstvos, or self-government institutions, during the fifty years following their creation in 1864. District and provincial zemstvos, working with the physicians they employed, developed a model of rural health-care delivery that was financed through the zemstvo budget rather than through payments for service. By 1914 zemstvos had crafted an impressive network of rural clinics, hospitals, sanitary initiatives, and schools for training auxiliary medical personnel. The scope and quality of zemstvo medicine varied widely, however, depending upon the wealth and political will of individual districts. The conferences that physicians and zemstvo officials held at the district and provincial level were a vital dimension of Russia’s emerging public sphere, as was a lively medical press and the activities of professional associations such as the Pirogov Society of Russian Physicians.

  By 1912 there were 22,772 physicians in the empire, of whom 2,088 were women. They were joined by 28,500 feldshers, 14,000 midwives, 4,113 dentists, and 13,357 pharmacists. The fragmentation of medical administration among a host of institutions made it difficult to coordinate efforts to combat cholera and other epidemic diseases. Many tsarist officials and physicians saw the need to create a nationa
l ministry of public health, and a medical commission headed by Dr. Georgy Er-molayevich Rein drafted plans for such a ministry. Leading zemstvo physicians, who prized the zem-stvo’s autonomy and were hostile to any expansion of central government control, opposed the creation of such a ministry. The revolutions of 1917 occurred before the Rein Commission’s plans could be implemented. See also: FELDSHER; HEALTH CARE SERVICES, SOVIET

  BIBLIOGRAPHY

  Alexander, John T. (1980). Bubonic Plague in Early Modern Russia: Public Health and Urban Disaster. Baltimore and London: Johns Hopkins University Press. Conroy, Mary Schaeffer. (1994). In Health and in Sickness: Pharmacy, Pharmacists, and the Pharmaceutical Industry in Late Imperial, Early Soviet Russia. Boulder, CO: East European Monographs. Frieden, Nancy. (1981). Russian Physicians in an Era of Reform and Revolution, 1856-1905. Princeton, NJ: Princeton University Press. Hutchinson John F. (1990). Politics and Public Health in Revolutionary Russia, 1890-1918. Baltimore: Johns Hopkins University Press. McGrew, Roderick E. (1965). Russia and the Cholera, 1823-1832. Madison: University of Wisconsin Press. Ramer, Samuel C. (1982). “The Zemstvo and Public Health.” In The Zemstvo in Russia: An Experiment in