Privatization, Competition, and Budget Constraints: Disciplining Enterprises in Russia

Preprint
Publisher Website
Google Scholar
    • preprint
      • Published in RePEc
Abstract
We investigate whether privatization, competitive forces, and the hardening of budget constraints played efficiency-enhancing roles in Russia in the immediate post-privatization period. We find evidence of a positive impact of privatization on labor productivity: a 10% point increase in private share ownership raises real sales per employee by 3–5%. The evidence on product market competition is weaker, depending on model specification. Soft budget constraints are usually found to reduce restructuring but the effect is small and insignificant. We find that in terms of their impacts on productivity, privatization and subsidy reduction are substitutes; privatization and competition (measured as the geographic scope of markets) are complements; and that competition and subsidy reduction are independent. Copyright Kluwer Academic Publishers 2003 (This abstract was borrowed from another version of this item.)
All Related Versions

This publication has 0 references indexed in Scilit: