The order built on the basis of the Leader-Arbiter mechanism leads to the personification ofpower. This mechanism of rule has made it easier to carry out market reforms and to resolveconflicts between influential groups. At the same time, however, it has become a seriousobstacle to developing solid democratic institutions and transparent politics, leading to theformation of networks of informal ties and “shadow rules of the game” rather than a politicalsystem based on clear rules and the separation of powers
The leader-arbiter mechanism in Russia helped with the reforms but hindered how democratic institutions could develop. Relying on "shadow rules" led to informal networks rather than policy. This undermined democratic progress and instead enforced authoritarian practices. This segment tells us that political reform was difficult but for a number of reasons. One of which is the informal networking but another was the internal divisions that this caused within the elite.