Shuttle Trade across Russia’s Borders with the Baltic States and Poland: Between Tolerance and Suppression

The paper focuses on the phenomenon of borderland shuttle trade across Russia’s borders with Estonia, Latvia, Lithuania, and Poland. I argue that borderland shuttle trade is more sustainable in comparison with long-haul shuttle trade, as the former gives entrepreneurs more flexibility, involves fewer transaction costs, and can rely on the extensive support of borderland communities. At the same time, it has some specific vulnerabilities, and its susceptibility to customs control and reliance on overloaded border crossing infrastructure are among the most important. Contrary to beliefs about contemporary states’ inability to exercise efficient control over informal cross-border flows in the age of globalization, this research demonstrates that over the course of time, states may be at least partially successful in suppressing informal cross-border trade. Ultimately, cross-border shuttle trade has proven to be vulnerable to more and more targeted restrictions and control practices. Still, it has also proven to be highly resistant to governmental crackdown in various ways, such as buying fuel from long-haul truck drivers or switching to trade in non-excisable goods or to low-penalty cigarette smuggling. The latter practice illustrates that shuttle trade is only part of the flexible informal cross-border economy and that it can be transformed into low-penalty smuggling when needed.