In the absence of private property rights: Political control and state corporatism during Putin’s first tenure

This paper argues that Russia’s choice of economic organisation, which is based on the renewed role of the state, is a response to the existence of severe transaction costs, and subsequent mitigation of contractual incompleteness in the absence of a strong property rights system. Ill-defined property rights have historically hampered formation of business classes in Russia, reducing the necessity for appropriate market infrastructure. This also implied that if Russia’s political and economic system had more than one competing hierarchy, such as truculent members of the lower classes of bureaucracy, the objective of the elites would not have entailed long-term economic growth, as gains from short-term wealth tunnelling would have been much larger. As in the early 2000s Russian investment projects were generally defined by large sunk costs and long-term to maturity, under a weak legal system a new substitute governing mechanism, which took form of the state-private co-partnership system, has arisen in order to reduce hold-up costs leading to high levels of underinvestment

Whither corporate Russia

Using firm-level information obtained from the Russian Trading System stock exchange from 1998 through 2006, we estimate growth performance of the Russian corporate sector. We find consistently improving growth, and note that higher growth performance is correlated with greater partial state re-acquisition and state corporate governance presence. We argue that the latter served, not only to safeguard against misappropriation of firm assets and government subsidies, but also to discourage managers from opting for shorter than optimal investment durations. Thus state corporate-governance strategy may serve as a second best policy to a more developed property rights system. © 2012 ACES. All rights reserved

The Re-Emerging Role of the State in Contemporary Russia

I examine ownership structure of Russian firms during the 1998-2006 period, where a greater emphasis is placed on motivations behind increased government ownership in the latter years, when oligarchs' opportunistic influence on the firm diminished as state ownership correspondingly increased. As this phenomenon is also correlated with improved corporate growth during the period, I argue that state participation in corporate governance acted as an effective substitute mechanism to constrain wealth-tunnelling behaviour of corporate insiders and local bureaucrats in a country defined by a weak property rights system. © 2012 Springer-Verlag

Gerschenkron revisited: The new corporate Russia

© 2015, Journal of Economic Issues / Association for Evolutionary Economics. Our analysis is based on firm-specific data compiled from the Russian Trading System stock exchange and SKRIN (CKP-H in Russian) database. We seek to identify the factors behind Russias dramatically improved corporate sector performance from the beginning of the 2000s to December 2007. We argue that improved long-term corporate performance was a consequence of several policy initiatives associated with the state-dominated banking sector, which enabled statesubsidized investment funds to be channeled from a structurally reengineered energy sector to targeted investment projects located in other industries. We claim that Russias industrial strategy closely conforms to Alexander Gerschenkrons catch-up theory

Whither corporate Russia?

EThOS - Electronic Theses Online ServiceGBUnited Kingdo

Whither corporate Russia?

EThOS - Electronic Theses Online ServiceGBUnited Kingdo

Corporate Ownership, Control, and Firm Performance: Evidence from a Nascent and Unregulated Market

Scholars have long debated whether ownership matters for firm performance. The standard view regarding Victorian Britain is that family-controlled companies had a detrimental effect on performance. In this article, we examine this view using a hand-collected corporate ownership dataset. Our main finding is that it was not necessarily the broad structure of corporate ownership that mattered for performance, but whether family blockholders had a governance role. Large active blockholders tended to increase operating performance, implying that they reduced managerial expropriation. Contrastingly, we find that directors who were independent of large owners were more likely to increase shareholder value