Act on the Settlement of Payments (ASP) 154–155
Alchian, A.A. 122
Amurzhuyev, O. 56
Angelo, G. 25
Appel, H. 7, 14, 15, 20, 31, 68, 82
Åslund, A. 4, 5, 17, 20–21, 25, 34, 59, 62, 69, 75, 117
Audit Chamber 16
Bakalenik, Josef 90
bank settlement system, failure of 153–154
banking system, collapse of 88
banking sector, strengthening 97
bankruptcy law 55
banks see Central Bank; loans-for-shares (LFS) operation
Barnes, A.S. 23, 31, 94, 95, 100
Berezovsky, Boris 103
Berliner, J.S. 25
Blasi, J.R. 14, 22, 33, 75, 93, 100, 101, 104–105
book values 35, 38, 79–80, 86, 153
Bornstein, M. 12
bottom-up approach 34, 35–36, 39, 79, 84
Boycko, Maxim 12, 15, 39, 60–61, 70, 101, 103, 114, 116, 119, 124
branch ministries 29, 56, 59, 63, 77, 94, 148, 151
British Petroleum (BP) 123–124
Brovkin, V. 98
Brown, D. 97
Buck, T. 32
Burbulis, Gennady 9, 29–30, 117
Camdessus, Michael 101
capital: sources of 68–69, 90; under planned economy 54
Carlin, W. 12
cash privatization: context of 98–103; goals of 92–93; interpretations of loans-for-shares scheme 95–96; summary of loans-for-shares arrangement 96–98
Central and Eastern Europe privatization model 12, 14, 15, 17–18, 105, 114, 115
Central Bank (Gosbank) 11, 33, 51, 54, 65, 102; and inter-enterprise debt 154–156
chaotic circumstances 8, 10, 12–13, 17, 25, 29, 32, 77, 84, 86, 114, 115
Chernomyrdin, Victor 33–34, 84, 94, 98–99, 102, 103, 117
Choksi, A. 11
Chubais, Anatoly 10, 11, 15, 16–17, 26, 27, 28, 29, 32, 82, 87, 93, 95, 99, 100, 102, 103, 116–117
Ciolko, M. 17
Civic Union 33
command economy: commercial law 54–55; credit and capital 54; efficiency, profitability and productivity 53–54; end of 71–72; enterprise towns and social role of enterprises 57; labour and labour mobility 57–58; monopoly and transport systems 55–57; role of money and prices 51–53
commercial law 61; under planned economy 54–55
Commission on Securities and Stock Funds 99
Commonwealth of Independent States 24–25
Communism, prevention of return to 32, 71, 118
Company Law (1995) 105
competition: obstacles to 62–64; under command economy 55–56
Congress of People’s Deputies 9, 24
constitutional considerations 9, 23, 24–26, 83–84, 118
control: privatization process 27–28, 33, 83–84; separation from cash flow rights 96, 119–120; separation from ownership 61–62
Cornia, G.A. 117
corporatization process, role of industrial associations 150–152
corruption 13, 16, 18, 19, 68–69, 93–94, 104, 105
cost zones 52
coup (1991) 6, 7, 8, 24, 86, 118
credit, under planned economy 54, 65
crediting of privatization, conditions for 143
currency devaluation 103
Czech Republic, privatization 6, 7, 12, 14, 20, 69, 114
Dallin, A. 24
de facto property rights 1, 19, 26, 36, 59, 61–62, 72, 87, 89–90
de jure property rights 1, 19, 32, 59, 62, 87, 89–90
De Melo, M. 17
deferred payments 75
Democratic Russia 9
Demsetz, H. 122
Desai, P. 32
Durden Smith, J. 100
early reputation of privatization 14–15
economic considerations 119–121
economic objectives 59–66, 92–93, 118
economic reform, pressure for 7–10
efficiency under planned economy 53–54
enforcement of property rights 17, 55, 61, 100, 105, 121
Enterprise Law (1990) 25, 28–29
enterprise towns, under command economy 57
enterprises: classification of 34, 127–133; investment by 68–69; ownership prior to 1992 privatization programme 28–34; prohibited from privatization 127–129; response to privatization 79–81; social role under planned economy 57; subject to mandatory privatization 132–133; to be privatized only by decision of government 129–130; to be privatized only by decision of State Property Committee 130–131; to be privatized only in accordance with local programmes of privatization 132
Estrin, S. 13, 14, 15, 120, 122
European Bank for Reconstruction and Development (EBRD) 50–51, 53, 60, 61, 62, 65, 75, 89, 156, 158
excluded enterprises 12, 34, 69, 127–129; inclusion of 85–86
expiry date, vouchers 38
export structure, under command economy 53
face value, vouchers 35, 81–82, 86
fairness issues 12, 20, 69, 82–83, 92
farm workers, ownership rights 25, 59, 102
Favarel-Garrigues, G. 104
federal budgets, receipts from privatization 37, 78–79, 101
Federal Property Protection Service, proposal for 121
Federation Treaty (1992) 23
Fedorov, Boris 99
Fidrmuc, J. 8
Fillipov, Petr 5
Financial Industrial Groups (FIGs) 93, 94, 96, 97, 105
financial institutions, establishment of 88
financial law 61; under command economy 54–55
financing, role of industrial associations 150
Fish, M. 8
foreign currency deposits, repatriation of 62, 68
foreign investors 62, 68, 94, 96, 97, 98, 102, 134, 144, 147
fragmented ownership 76
Frydman, R. 23, 27, 28, 29, 35, 56
Gaddy, C. 17
Gaidar, Yegor 10, 11, 29–31, 32, 33, 37, 62, 71, 84, 99, 100, 102, 116–117
Gazprom 56, 69, 83, 85, 95, 98, 100, 104, 114, 117
goals of privatization: budgetary/investment objectives 66–69; economic objectives 59–66; likelihood of achievement 73; social and political objectives 69–72
Goldman, P. 18, 20, 62, 66, 67, 104, 121
Gorbachev, Mikhail 4–5, 8, 9, 24, 25
government budget, privatization credits 37, 58, 66–68, 69, 92–93, 94, 98, 100, 103, 134
Graney, K. 23
Grigoriev, L. 19
Gros, D. 8
gross domestic product (GDP) 70
gross national product (GNP) 33, 89
Guriev, S. 95
Hahn, G. 23
Hanauer, L.S. 23
hard budget constraint 17–18, 39, 59, 64–65
Harman, M. 14
Hay, M. 89
Heybey, B. 17
historical background 24–26, 98–103
historical reappraisal, need for 114
Hoffman, D.E. 95
holding companies: challenge from 76–79; formation of 12, 40, 80, 94, 101, 150–152, 153; problem of 67, 68
hyperinflation 11, 13, 33, 75, 76, 79–80, 88, 94, 100, 155–156
Ickes, B. 17
identity symbolization 20
implementation capacity 23, 115–116
implementation of privatization (1992–1994): medium and large enterprises 76–90; small enterprises 75–76; timeline 91
implementation of privatization (after 1994): historical context 98–103; interpretations 95–96; overview 92–95; period in perspective 103–106; summary of loans-for-shares arrangement 96–98; timeline 107–112
industrial associations 28–29, 31, 33, 35, 56, 63; challenge from 76–79; role of 148–153
industrial lobby 8, 12, 31, 33–34, 35, 39, 98, 119–120
industrial structure, under command economy 55–56, 119
insider control 12, 33, 35, 36, 61–62, 80, 82, 88–90, 93
insider trading 12, 85–86, 93–94, 104
institutional considerations 26–28
institutional reform 8, 9, 10, 13, 16, 55, 59, 66, 104–105, 100, 103, 104–105, 114, 116, 120–121
inter-enterprise debt 65, 153–156
international aid organizations 7, 61, 67, 92, 94, 101, 105, 115; consensus shift 18–19; criticism of 16–17; support for privatization 14–15, 23
International Energy Agency (IEA) 52, 53
International Monetary Fund (IMF) 33, 52, 53, 57–58, 66, 101, 155
investment funds 65, 81–82, 88, 90, 150; collapse of 99
investment support, role of industrial associations 150
Jensen, M.C. 122
Johnson, S. 29
joint-stock companies 5, 15, 132, 135, 136, 137, 141, 143–144, 145, 148, 152
Kaban, E. 98
Kennet, J. 93
Khasbulatov, Ruslan 9, 31, 33, 76, 81, 104, 117
Kiev, effects of enterprise laws 29
Klebnikov, P. 95
Kokh, Alfred 66, 93, 97, 100, 102–103
Kopf, D.J. 5, 6, 16, 94, 96, 98
Kraakman, R. 105
Krueger, G. 17
labour/labour mobility: following restructuring 89–90; under planned economy 57–58, 64
Lane, D. 10
large enterprises, privatization of 6, 12, 15, 27, 34, 37, 69, 76–90, 98–101
Latin America, privatization 14, 17, 114
Law on State Enterprises (1988) 54–55, 59
Layard, P. 34
lease-to-purchase arrangements 5, 12, 21, 26, 28–29, 75
Leeds, R. 14
legal context, ownership rights 87–90
legal framework 22–23, 24–26, 100, 105, 120–121
legitimacy of funds 62, 67, 68, 76, 81, 92, 94
legitimacy of reform 32, 68, 74, 115, 118
Leonard, C. 25
Lieberman, I. 5, 6, 14, 15, 16, 94, 96, 98
Liesman, S. 99
Lipton, D. 13
living standards 59–60, 62, 65
loans-for-shares (LFS) 92–95, 105, 125; criticism of 16; default on 97, 102; interpretations 95–96; summary of 96–98
lobbying, role of industrial associations 149
local privatization programmes, requirements for 146–147
local property committees 27, 75
long-term judgements, privatization 16–17
McFaul, M. 8, 10, 100, 103, 106, 118
machine tool trade association 77–78
mafia 98
market economy objective 62–66
marketing support, role of industrial associations 149
Matthews, M. 57
Mavrodi, Sergei 99
Means, G. 61
Mechel 98
Meckling, W.H. 122
medium enterprises, privatization of 76–90
Megginson, W.L. 19
Memorandum of Economic Policy (1992) 64
Milgrom, P. 122
Miller, Y. 14
MMM, collapse of 99
money, role in planned economy 51–53
monopoly: creation of 88; as obstacle to privatization 63–64, 119; under planned economy 55–57
moral hazard 65
Moscow, privatization arrangements 26, 28
Moser, R. 118
Mostovoi, Petr 5, 25, 26, 32, 114
Murrell, P. 17
Naishul, V. 19
national savings bank (Sberbank) 51
natural resource sectors 29, 34, 52–53, 56, 85, 90, 93–100, 104
Nelson, L. 1
nepotism 94
Netter, J.R. 19
“new” Keynesianism 18
nominal ownership, distinction with effective control 151–152
non-tradable vouchers 12, 37, 76, 81, 134, 138, 141–144, 146
non-voting shares 35, 61, 136–137
Norilsk Nickel 29, 96, 98, 104, 122–123
Novolipetsk Steel Works 98
Novosibirsk, voucher auctions 84; privatization process 157–158; setting up privatization centre 158–159; voucher trading 159–160
oil and gas industry 29, 34, 52–53, 56, 85, 90, 93–100, 104
oligarchy 16, 20, 68–69, 71–72, 87, 95–96
Oneximbank 96, 97, 103, 104, 122–123
Oppenheimer, P. 20
Organization for Economic Cooperation and Development (OECD) 21
Our Home is Russia 102
outside investors 35, 75, 81, 88, 90, 95, 104, 119–120
ownership rights, legal and social context 87–90
ownership objectives 59–62, 119–120
ownership prior to 1992 privatization programme 28–34
Oxford Analytics (OA) 30, 31, 33
Panskov, Vladimir 97
Papageorgiou, D. 11
payments system, collapse of 88
Peacock, A. 89
performance, effects of privatization 13
personal privatization accounts 12, 37–39, 76, 81, 134, 138
personal privatization deposits, use of 143–144
philosophical considerations 121–125
Pistor, K. 18
pledge auctions 95–96, 98, 102–103, 105
political backdrop to privatization 29–34, 98–103
political consensus, shift in 18–20
political considerations 115–119
political control of enterprises 70, 80, 93
political objectives 69–72, 93
political reform, pressure for 7–10
Ponzi schemes 99
Popov, V. 117
popular support, generation of 69–71
positive stance, privatization 20–21
Potanin, Vladimir 93, 97, 102, 103
presidential decrees 9, 12, 23, 25–26, 27–28, 29, 31, 37, 74, 81, 99, 113, 118, 125
price discounts, workers’ collectives 33, 35, 75, 138, 140, 141, 159
price liberalization 4, 11, 13, 32, 33, 34, 64, 65
prices, role in command economy 51–53
privatization bodies, order of interrelations/relations with state management bodies 145
privatization centres, setting up 158–159
privatization commissions 27, 36–37
Privatization Law (1991) 12, 24, 33, 35, 36, 37, 115
privatization options 12, 35–37, 135–143
privatization process: investigation into 104; role of industrial associations 150–152
privatization programme (1992): achievements of 87–90; classification of enterprises and facilities 34, 127–133; discussion 39–40; goals of 58–73, 126–127; medium and large enterprises 76–90; ownership prior to 28–34; responsibility for 24–28; small enterprises 75–76; text 126–147; timeline 41–49, 91; uniqueness of 50–51; voucher privatization 37–39
privatization: background to 7–13; consensus shift 18–20; early reputation 14–15; estimated figures 133–134; failures 17–18, 103–106; further reflections 20–21; prior to 1992 4–6; reception in mid–1990s 16–17; Russia as model for 15; views of industrial associations 152–153
production coordination, role of industrial associations 150
productivity, under planned economy 53–54
profit maximization 63, 65–66, 89
profitability, under planned economy 53–54
Property Fund 27, 84, 144–146, 147, 157
“propiska” (internal passport) system” 57–58, 64
public attitudes, changing 71
purchasers, use of vouchers 81–83
R&D support, role of industrial associations 149
Rachinsky, A. 95
railway system 57
red directors, as beneficiaries of loans-for-shares 94, 95
reformers: agenda 98–99, 119; appointment and involvement 29–34; experience 116–117; influence 94–95; powers 27–28, 113, 114–115; views on loans-for-shares 97–98
regional budgets, receipts from privatization 37, 78–79, 101
regional implementation 83–84, 156–160
regional variation, conduct of privatization 27
renationalization, calls for 97, 100, 101, 102
resource use, under command economy 53–54
restructuring 12, 13, 14–15, 17–18, 35, 39, 59, 64–66, 70–71, 88–90, 97
revenue forecasts from privatization (1992–1994) 134–135
revenue generation from privatization 66–68, 92–93, 97, 101
Roberts, J. 122
Rosneftigas 56
Ross, C. 10
Rosstrom 148
“rule by decree” 9, 12, 23, 25–26, 27–28, 29, 31, 37, 74, 81, 99, 113, 118, 125
savings, lack of 40, 67, 76, 86, 94
Sberbank 51
self-dealing 18
Shatalin, Stanislav 5
Shlapentokh, V. 19
small enterprises, privatization of 27, 34, 75–76, 123
Smolensk, voucher auctions 83–84
social context, ownership rights 87–90
“social safety net” 66
social role of enterprises 57, 70
social upheaval, threat of 67, 71–72
Soskovets, Oleg 99
Soviet Union, breakup of 24–25
special-purpose financial funds, formation of 145–146
spontaneous privatization 5, 8, 12, 19, 117, 120, 158
Spulber, N. 51
stabilization 4, 11, 13, 17–18, 33, 66, 77, 101, 102, 126
Standing, G. 57
State Committee for Anti-Monopoly Policy and Promotion of New Economic Structures (GKAP) 63–64
State Committee for the Management of State Property (Goskomimushchestvo/GKI) 2, 27, 34–35, 38, 62, 67, 70, 78, 79, 80, 83–84, 89, 102–103, 150–151; Agency for Inter-enterprise Debt 155–156
State Committee on Industrial Policy 94
Steele, J. 87
Steinherr, A. 8
Stone, R. 14
strategic industries 18, 34, 69, 93, 100
strategic investors 61–62, 67, 76, 78, 81, 100, 102
suppliers, strengthening ties with 152
supply coordination, role of industrial associations 149
Supreme Soviet 5, 9, 24, 25, 41, 81, 113, 114
Svejnar, J. 13
telecommunications companies 6, 101, 103
tenders 34, 68, 75, 86, 136, 139–140
Thames, F. 118
time constraints 13, 18, 19, 32, 38, 67, 114, 115–117
timeline: 1986–1992 41–49; 1993–early 1994 91; 1994–1995 107–112
Titkin, Alexander 77–78, 151–152
Tolkacheva, J. 99
tradable vouchers 6, 12, 37–40, 76, 81–83
trade liberalization 4, 10, 14
transaction costs 60, 123, 124
transport systems, under planned economy 55–57
Treisman, D.S. 18, 69, 93, 94, 95–96, 97, 100, 101
“trusts” 5, 59, 80, 81, 159–160
Tsapelik, V. 56
Tsikata, T. 17
unemployment: as result of restructuring 70, 89–90; under command economy 57
upstream investments, oil companies 96
US Government Accountability Office (GAO) 14–15
Ustiuzhanina, E.V. 5
Varese, F. 13
Vasiliev, Dmitry 67, 68, 77–78, 83, 93, 98
very large enterprises, privatization of 34
Vishny, R. 60
Volgin, A. 14
voluntary associations 148, 150
voting rights shares 33, 35, 61–62, 79, 137, 138
voucher auctions: Novosbirsk 83–84, 157–160; outcomes 85; Smolensk 83–84, 156–157
voucher design and its effects 12, 81–83
voucher privatization, objectives of 66–68
voucher trading, Novosbirsk 159–160
vouchers 37–39; expiry date 38; sale of 82, 84, 157; values of 38, 69, 81–82, 85–87, 159–160
Vysokov, V.V. 18
Washington Consensus 1, 3, 7, 14, 18, 20
Weisskopf, T. 33
Williamson, John 14
Williamson, O. 122
Woods, N. 13
worker subscriptions 38, 39, 74, 79–83, 86
workers’ collectives 5, 10, 15, 25, 28, 36–37, 59, 75
World Bank 11, 14, 23, 25, 29, 30, 33, 36, 60, 61, 62, 65
Yavlinsky, Grigory 5, 16, 120, 121
Yeltsin, Boris 8–10, 11, 16, 24, 25, 28, 30, 31–32, 71, 90, 93, 94–95, 97, 98, 100, 101, 102, 113, 117, 118