Observations on the Use of Law by Russian Enterprises

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Abstract
Four specialists on the Russian economy analyze the extent to which enterprises use law and legal institutions in structuring exchange relations. The analysis uses the responses from questionnaires administered to sixty officials of fifteen enterprises in Moscow and Yekaterinburg during May-June 1996, supplemented by interviews in enterprises and within arbitrazh courts. Their results indicate that enterprises make little use of law and consider legal institutions to be ineffective. Other than ties based on historic business relations, there is an absence of social and economic networks that might function as substitutes for law. The underdevelopment of institutions to foster impersonal relations between firms slows restructuring and growth. Journal of Economic Literature, Classification Numbers: P51, P11, K1.