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Discussion Paper Details

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Title: The Determinants of Privatized Enterprise Performance in Russia

Author(s): Manuela Angelucci, Alan Bevan, Saul Estrin, Julian A Fennema, Boris Kuznetsov, Giovanni Mangiarotti and Mark E Schaffer

Publication Date: February 2002

Keyword(s): competition, corporate governance, enterprise performance, investment and privatization

Programme Area(s): Transition Economics

Abstract: Using data from a large enterprise-level panel designed to address this issue, we account for enterprise performance in Russia. We link performance to four aspects of the economic environment outlined in the literature: enterprise ownership; corporate governance; market structures and competition; and financial constraints. We conclude that private ownership and better performance are not correlated, though restructuring is positively associated with the competitiveness of the market environment. These findings on private ownership support those of previous studies, eg Earle and Estrin (1997). Moreover, we find only limited evidence that financially unconstrained firms are better in their undertaking of restructuring measures then financially constrained firms. Further analysis suggests that causality runs from restructuring to financial constraint, rather than the reverse. Finally, our findings indicate strong complementarities between the four factors influencing improved company performance, confirming the view that these factors need to be considered jointly.

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Bibliographic Reference

Angelucci, M, Bevan, A, Estrin, S, Fennema, J, Kuznetsov, B, Mangiarotti, G and Schaffer, M. 2002. 'The Determinants of Privatized Enterprise Performance in Russia'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=3193