ATOTSI, Georgia — As Crimeans danced in the streets this week, giddy at the prospect of being gathered into Russia, few were watching as closely as the residents of the tiny mountainous enclave of South Ossetia, who, five and a half years ago, were similarly ecstatic.

On the day in 2008 when Russia formally recognized the enclave as independent of Georgia, young men hung out of their car windows, waving Russian flags and spraying pedestrians with champagne. Officials daydreamed about building an economy based on tourism, like those of Monaco or Andorra.

That has not happened. These days South Ossetia’s economy is entirely dependent on budgetary funds from Russia. Unemployment is high, and so are prices, since goods must now be shuttled in through the tunnel, long and thin like a drinking straw, that cuts through the Caucasus ridge from Russia....