Alexander Radygin

Corporate Governance and Ownership Structure in the Transition: The Current State of Knowledge and Where to Go from Here

The purpose of the paper is to present the current state of knowledge on both theoretical models and empirical evidence of interrelations between emerging corporate governance mechanisms and ownership structure of privatized enterprises in post-Communist countries. Section 2 contains extensive literature review on the subject. In Section 3, the results of the research coordinated by CASE on post-privatization changes in ownership structure of Polish, Czech and Slovenian enterprises are presented. In Section 4, the Authors present conclusions and a few suggestions for policy makers.

Failures of the State: Theory and Policy

The article deals with the evolution of approaches in modern economic theory to the problem of “failures of the state”. This approach, which has developed in opposition to concepts of “market failure”, can be seen as a search for a new strategy of political and economic analysis of mechanisms of resource allocation and of historical social institutions and their effect on the efficiency of economic processes. Special attention is paid to the problem of information retrieval as a starting point for the analysis of the economic functions of the public sector, to ways of funding state undertakings, to the impact of rent-seeking behavior, to the role of the political process, and to negative externalities such as lack of coordination and the presence of the state in the economy in general. An interdisciplinary approach to “failures of the state” takes into account the influence of legal norms and institutions on the nature of allocation of public resources, as illustrated by the examples from the modern Russian economy.

Large-scale reluctant privatization: Contradictions and challenges under sanctions

The article discusses the practicability for privatizing some large Russian state-owned enterprises (SOEs) under sanctions. Privatization remains a significant trend in the economic policies of many countries, including Russia. The revenues from privatization demonstrate a steady upward trend worldwide. The effect of external sanctions which create significant difficulties in conducting privatization in Russia does not remove from the agenda the issue of privatization of large companies, but also makes it more relevant. Privatization is an effective tool for forming a competitive environment, increasing the efficiency of SOEs and reducing the presence of the state as a direct participant in market relations. The article contains not only theoretical arguments in favor of privatization, but also its relevance, especially considering the sectoral structure of the economy and the performance indicators of large SOEs. A particular feature of the research methodology is the evaluation of the performance of 29 large SOEs on the basis of a universal set of financial indicators. As a benchmark, we use the financial indicators of 144 Russian private companies and wide samples of foreign competitors for each SOE. The results show that the consolidated financial characteristics of SOEs tend to be inferior to those of private companies and foreign competitors. In addition, the total return, including dividend yield, on the state-owned enterprises’ equity is below the return of market benchmark with lowest risk.

Russian Institutional Investors And Privatization Policy

The resources of pension and investment funds for mobilizing domestic sav ings are particularly important in attracting investment and carrying out large-scale privatization considering restrictions associated with the sectoral sanctions. With all the limitations and disadvantages, the existing non-state pension funds and mutual funds managed by private companies have signifi cant potential in dealing with problems of domestic savings provided stable macroeconomic environment is maintained.

State Property Management: Statistical Portrait Novelties

A new indicator framework for the performance measurement of state property management was adopted early last year. Basic characteristics of state property and of economic entities that are in state ownership have been presented on the basis of the initial data gathered from the framework. Transition to providing data in terms of legal forms, which was not the case under the old indicator framework for public sector monitoring, as well as a special focus on property (real estate, land, stakes (interest) of any size) given the value and liquidity thereof is the main novelty that the new framework offers.

The Fundamental Privatization Theorem: Ideology, Evolution, Practice

The article focuses on the analysis of the evolution of contemporary theoretic approaches to the choice of an optimal form of ownership, and the corresponding estimation of privatization in the context of the advantages and disadvantages of the public and private sectors of the national economy. Various interpretations of the fundamental privatization theorem are considered: based on the principal-agent relationship; based on the comparison of the structure of information flows; the combination of ownership rights and contractual rights; consideration of sociopolitical factors, etc. The latest trends in Russia’s de-statization policy in 2010-2013 are analyzed in the context of ‘reluctant privatization’, with special emphasis on the asymmetry between the statization and privatization processes.

A New Turn in the Privatization Policy

The Forecast Plan (Program) for the Privatization of Federal Property and the Main Guidelines for the Privatization of Federal Property in 2014–2016 were approved by the Russian Government’s Executive Order dated July 1, 2013, No. 1111-r. This is already a second 3-year privatization program developed with consideration for the planning period of the Forecast Plan (Program) for the Privatization of Federal Property (from one year to three years) based on the amendments which were made to the applicable law on privatization in the spring of 2010

Institutions and Economic Growth: Contemporary Theoretical Approaches

The main purpose of this article has been to offer a purely academic overview of all the truly significant economic, political and legal relationships that are directly associated with the institutional parameters of economic growth and have already been recognized in modern economics.

Institutions and Economic Growth: Some Realities of Contemporary Russia

The interactive structure - ‘the State (authority) – property’ that has been created during the 2000s envisages a merger of state property with the vertical of power. In such a model, the principal long-term problem consists not only – and not so much – in the fact that the ‘business community’ (the market and private property) is subordinated to the State (authority). It is no less important that the interaction between the state and private forms of ownership, instead of being horizontal (when there are market-based preconditions for competition), becomes vertical. This absence of market-based competition, in its turn, results in the suppression of one of the forms, in the destruction of market mechanisms and ultimately in the loss of the efficiency potential in both the state and private sectors.

State and De-Statification: Risks and Limitations of a 'New Privatization Policy'

It will be some time before we can fully appreciate the radical nature of the socio-economic effects produced by the global crisis of the end of the first decade of the twenty first century. However, it is already evident that the two leading market economic systems of the Western world – that of the USA, based on an ideology of free market competition, and the socially oriented system of Europe, were unable adequately to respond to the initial phase of the crisis. Moreover, the only measures that proved capable of preventing financial and economic collapse were those taken by states that possessed powerful levers for acting upon the economy as the crisis unfolded. Russia was one of these states, though circumstances in Russia were not typical.