Voucher privatisation in Russia: Structural consequences and mass response in the second period of reform

Europe - Asia Studies

Volumn 49, Issue 8, 1997, Pages 1433-1449

  Appel, Hilary ^a  

^a UNIVERSITY OF PENNSYLVANIA   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

ECONOMIC REFORM; PRIVATISATION; REFORM PROCESS; VOUCHER PRIVATISATION;

RUSSIAN FEDERATION;

EID: 0031428518     PISSN: 09668136     EISSN: None     Source Type: Journal    
DOI: 10.1080/09668139708412508     Document Type: Article

References (89)

1. The author thanks Joseph Blasi, Thomas Callaghy, M. Steven Fish, Meredith Hyman, Herbert Levine, David Mason, Vincenzo Quadrini and Srirupa Roy for their helpful comments and suggestions on earlier drafts of this article. The author gratefully acknowledges the Institute for the Study of World Politics (ISWP) and the Social Science Research Council (SSRC) for their generous support during the researching and writing of the article. The opinions expressed are those of the author and do not necessarily reflect those of the ISWP or the SSRC. Any errors are, of course, mine.
2. See Maxim Boycko, Andrei Shleifer & Robert Vishny, 'Privatizing Russia', Brookings Papers on Economic Activity, 1993, 2, pp. 139-181; Maxim Boycko, Andrei Shleifer & Robert Vishny, Privatizing Russia (Cambridge, MIT Press, 1995); Maxim Boycko, Andrei Shleifer & Robert Vishny, 'Voucher Privatisation', Journal of Financial Economics, 35, 1994.
3. See Maxim Boycko, Andrei Shleifer & Robert Vishny, 'Privatizing Russia', Brookings Papers on Economic Activity, 1993, 2, pp. 139-181; Maxim Boycko, Andrei Shleifer & Robert Vishny, Privatizing Russia (Cambridge, MIT Press, 1995); Maxim Boycko, Andrei Shleifer & Robert Vishny, 'Voucher Privatisation', Journal of Financial Economics, 35, 1994.
4. See Maxim Boycko, Andrei Shleifer & Robert Vishny, 'Privatizing Russia', Brookings Papers on Economic Activity, 1993, 2, pp. 139-181; Maxim Boycko, Andrei Shleifer & Robert Vishny, Privatizing Russia (Cambridge, MIT Press, 1995); Maxim Boycko, Andrei Shleifer & Robert Vishny, 'Voucher Privatisation', Journal of Financial Economics, 35, 1994.
5. Privatisation officials write 'it [was] precisely the free distribution of property in society that considerably strengthened the political support for privatisation and for economic reforms as a whole'. See A. Chubais & A. Vishnevskaya, in A. Aslund (ed.), Economic Transformation in Russia (New York, St Martin's Press, 1994), p. 99.
6. For comments by Chubais on the use of public support for advancing privatisation in 1992, see Chubais, Argumenty i Fakty, 28 November 1992, p. 3.
7. See Chubais & Vishnevskaya, p. 99.
8. For excerpts from El'tsin's anniversary speech, see Komsomol'skaya Pravda, 22 August 1992, p. 2. For discussion and analysis of the speech, see Izvestiya, 24 August 1992, pp. 1-2, or Rossiiskaya gazeta, 22 August 1992, pp. 1-2.
9. For excerpts from El'tsin's anniversary speech, see Komsomol'skaya Pravda, 22 August 1992, p. 2. For discussion and analysis of the speech, see Izvestiya, 24 August 1992, pp. 1-2, or Rossiiskaya gazeta, 22 August 1992, pp. 1-2.
10. For excerpts from El'tsin's anniversary speech, see Komsomol'skaya Pravda, 22 August 1992, p. 2. For discussion and analysis of the speech, see Izvestiya, 24 August 1992, pp. 1-2, or Rossiiskaya gazeta, 22 August 1992, pp. 1-2.
11. For a discussion of voucher transferability policies in Eastern Europe, see John Earle, 'Voucher Privatisation in Eastern Europe', conference paper from Versailles Workshop on Voucher Privatisation, Central European University, 1992.
12. On the Lithuanian example see Roman Frydman & Andrzej Rapaczynski, Privatization in Eastern Europe: Is the State Withering Away? (London, Central European University Press, 1994), p. 151; and on the Czech example see Hilary Appel, 'Justice and the Reformulation of Property Rights in the Czech Republic', East European Politics and Societies, 9, 1, 1995, p. 30.
13. On the Lithuanian example see Roman Frydman & Andrzej Rapaczynski, Privatization in Eastern Europe: Is the State Withering Away? (London, Central European University Press, 1994), p. 151; and on the Czech example see Hilary Appel, 'Justice and the Reformulation of Property Rights in the Czech Republic', East European Politics and Societies, 9, 1, 1995, p. 30.
14. One study shows that in 1992 rural Russians, employees of the non-productive sphere and pensioners were the quickest to sell their vouchers for cash. 'By the end of 1992, these categories of the population were not only unable to effectively utilise their vouchers by choosing an object of privatisation, but they were unable to use them in any other way except by selling them'. A. Kuzenkov & I. Maximov, 'Vysledki privatizatsii', Problemy prognozirovaniya, 5, 2, 1993, p. 111.
15. See Boycko et al., 'Voucher Privatization', p. 260.
16. Boycko et al., Privatizing Russia, p. 87.
17. Quoted in Financial Times, 26 November 1993, p. 2.
18. Within the context of voucher privatisation, the government proposed three variants for privatising corporate shares from which worker collectives could choose: (1) employees could receive 25% of non-voting shares, with the option of purchasing an additional 10% of voting shares at discounted rates; in addition top managers could buy 5% of shares; (2) employees could purchase up to 51% of their enterprise's shares for a fixed price plus an additional 5% through an employee share-owning programme, and (3) a small group of employees could buy 20% of voting shares at the end of one year. Approximately 77% of privatising firms chose the second option, 21% the first option, and 2% the third option. For further details, see P. Sutela, 'Insider Privatisation in Russia; Speculations on Systemic Change', Europe-Asia Studies, 46, 3, 1994, pp. 417-435. Enterprise collectives overwhelmingly chose the second option because it enabled insiders to secure control of their firm without fear of outside interference.
19. For a detailed discussion of the privatisation of Gazprom, see Igor Nikolaev et al., 'Nikogda ne narushaite zakon po melocham; Privatizatsiya Gazproma', Kommersant, 1994, 4, 8 February, pp. 31-32 or Igor Nikolaev, 'V gazovyi ryad, s vauchernym rylom ne puskayut', Kommersant, 1994, 3, 1 February, pp. 33-35.
20. For a detailed discussion of the privatisation of Gazprom, see Igor Nikolaev et al., 'Nikogda ne narushaite zakon po melocham; Privatizatsiya Gazproma', Kommersant, 1994, 4, 8 February, pp. 31-32 or Igor Nikolaev, 'V gazovyi ryad, s vauchernym rylom ne puskayut', Kommersant, 1994, 3, 1 February, pp. 33-35.
21. Andrei Shleifer & Dmitry Vasiliev, 'Management Ownership and Russian Privatization', conference paper from World Bank Conference on Corporate Governance in Central Europe and Russia, Washington DC, 15 December 1994, p. 9.
22. On benefits to insiders, see Sutela, and Peter Rutland 'Privatisation in Russia: One Step Forward: Two Steps Back?', Europe-Asia Studies, 46, 7, 1994, pp. 1109-1131.
23. Privatisation and government officials were fully aware that managers were using workers as an excuse from the earliest stages of the privatisation process. As Shleifer & Boycko write, 'the usual strategy of managers is to hide behind the workers and to insist on greater benefits for the worker collectives. Typically this means worker manager buy-outs ... where managers often get large ownership stakes and complete control in exchange for promising high wages to the workers', Note that in their own writing, officials and advisers were more apt to characterise managerial coercion in a more benign form than outside observers as discussed below, where managers employed carrots rather than sticks to achieve worker compliance. See M. Boycko & A. Shleifer in O. Blanchard (ed.), Post-Communist Reform: Pain and Progress (Cambridge, MA, MIT Press, 1993), p. 148.
24. For a discussion of the transfer of shares from workers to managers, see Lina Markova, 'Direktorskaya privatizatsiya: kakogo sobstvennika ona porodila', Obshchestvenno-poliricheskii zhurnal, 17, 1995.
25. Author's interview with labour specialist, Irene Stevenson, director of the Moscow branch of the AFL-CIO, Moscow 3 July 1996.
26. See Igor Gurkov, 'Popular Response to Russian Privatisation: Surveys in Enterprises', Studies in Public Policy, 245, 1995, pp. 1-62, especially pp. 20-21.
27. Joseph Blasi & Andrei Shleifer, 'Corporate Ownership and Corporate Governance in the Russian Federation', The Moscow Times, 16 July 1996.
28. See Joseph Blasi, Maya Kroumova & Douglas Krus, Kremlin Capitalism: Privatizing the Russian Economy (Ithaca, Cornell University Press, 1997) especially Table 5, p. 193.
29. See note 13.
30. Survey quoted by Anders Aslund, 'How Some Russians got Rich', Financial Times, 31 May 1996, p. 16.
31. This section is based on interviews conducted in Moscow during June-July 1996 with current or former employees of the Russian State Property Committee, the Russian-American Foundation for Trade Union Research and Education (funded by the AFL-CIO), the Fund for the Support of Privatisation and Development of the Financial Market, and the International Financial Corporation.
32. For a discussion of Russian managers' ability to control registers and proof of ownership, not only of the shares of workers but of outside owners as well, see Natasha Mileusnic, 'The Great Boardroom Revolution', The Moscow Times, 16 July 1996.
33. Nigel Stephenson, 'Norilsk Analysts Welcome Russian Aid Decree', The Reuter European Business Report, 13 August 1996.
34. In the case of Norilsk Nickel, the wage arrears led some workers to sell shares to outsiders in order to support the hostile takeover, hoping the new management would pay wages on time. However, the new management has also been burdened with a shortage of capital and has not paid wages on time. In response to worker strikes, and the lobbying efforts by the management, the government has granted additional subsidies to help pay workers and granted other concessions, such as exemptions from import duties on mining equipment. For further details, see Stephenson, and Financial Times, 4 September 1996, p. 17.
35. For further details on the structure of FNPR, see Robert Evans, 'World Union Body Says Russia Abuses Worker Rights', Reuters World Service, 13 June 1995.
36. For more information on FNPR and its relationship to the government as well as the role of workers in industrial relations in post-communist Russia, see Simon Clarke, Trade Unions, Industrial Relations and Politics in Russia', Journal of Communist Studies, 9, 4, December 1993; Simon Clarke, Peter Fairbrother, Michael Burawoy & Pavel Krotov, What About the Workers?: Workers and the Transition to Capitalism in Russia (New York, Verso, 1993); Leonid Gordon & Eduard Klopov (eds), Novye sotsial'nye dvizheniya v Rossii (Moscow, Progress-Kompleks, 1993).
37. For more information on FNPR and its relationship to the government as well as the role of workers in industrial relations in post-communist Russia, see Simon Clarke, Trade Unions, Industrial Relations and Politics in Russia', Journal of Communist Studies, 9, 4, December 1993; Simon Clarke, Peter Fairbrother, Michael Burawoy & Pavel Krotov, What About the Workers?: Workers and the Transition to Capitalism in Russia (New York, Verso, 1993); Leonid Gordon & Eduard Klopov (eds), Novye sotsial'nye dvizheniya v Rossii (Moscow, Progress-Kompleks, 1993).
38. For more information on FNPR and its relationship to the government as well as the role of workers in industrial relations in post-communist Russia, see Simon Clarke, Trade Unions, Industrial Relations and Politics in Russia', Journal of Communist Studies, 9, 4, December 1993; Simon Clarke, Peter Fairbrother, Michael Burawoy & Pavel Krotov, What About the Workers?: Workers and the Transition to Capitalism in Russia (New York, Verso, 1993); Leonid Gordon & Eduard Klopov (eds), Novye sotsial'nye dvizheniya v Rossii (Moscow, Progress-Kompleks, 1993).
39. For a brief discussion of the role and resources of FNPR in post-communist Russia and its alliance with the government, see Carol Clark, 'The Transformation of Labor Relations in Russian Industry: The Influence of Regional Factors in the Iron and Steel Industry', Post-Soviet Geography and Economics, 37, 2, 1996, pp. 95-96.
40. Simon Clarke, Peter Fairbrother & Vadim Borisov, The Workers' Movement in Russia (Brookfield, VT, Edward Elgar Publishing Company, 1995), pp. 406, 407.
41. E. Teague, Organized Labor in Russia in 1992', RFE/RL Research Report, 2, 5, 29 January 1993, pp. 38-41.
42. P. Kubicek, 'Variations on a Corporatist Theme: Interest Associations in Post-Soviet Ukraine and Russia', Europe-Asia Studies, 48, 1, 1996, pp. 27-46.
43. Interestingly, Clarke notes that on the national level the principal struggle characterising the independent trade unions was 'the individual and collective struggle for access to US funds. The key index of success and failure was whether the union and its leaders had been put on the payroll' of one of these two funds. See Clarke et al., The Workers' Movement ... p. 404.
44. One journalist from Rossiyskaya gazeta describes an alternative means to hide resources and declare insolvency as a way to delay wage payments, namely by making false loans to affiliate organisations and pseudo-branches. 'Throwers' in the Director's Chair', Rossiiskaya gazeta, 16 August 1995, p. 3, translated in 'Lack of Control Over Privatization Leads to Corruption', FBIS-SOV-95-166, 28 August 1995, pp. 29-30.
45. One journalist from Rossiyskaya gazeta describes an alternative means to hide resources and declare insolvency as a way to delay wage payments, namely by making false loans to affiliate organisations and pseudo-branches. 'Throwers' in the Director's Chair', Rossiiskaya gazeta, 16 August 1995, p. 3, translated in 'Lack of Control Over Privatization Leads to Corruption', FBIS-SOV-95-166, 28 August 1995, pp. 29-30.
46. I am indebted to Irene Stevenson for this point.
47. See the extensive interview with Anatolii Chubais on ownership and power in Aleksandr Privalov, 'O vlasti i sobstvennosti', Kommersant, 1994, 4, 1 November, pp. 10-15.
48. For a discussion on the transformation of the psychological perspective of workers-turned-owners, see Victor Supyan, 'Privatization at Stroipolymer', in John Logue, Sergey Plekhanov & John Simmons, Transforming Russian Enterprises: From State Control to Employee Ownership (Westport, CT, Greenwood Press, 1995).
49. Survey conducted in spring 1994. Cited in Gurkov, Table 17, p. 53.
50. Igor Gurkov & Gary Asselbergs, 'Ownership and Control in Privatised Companies: Evidence from a Survey', Communist Economies & Economic Transformation, 7, 2, 1995, pp. 203, 206.
51. See interview with Aleksandr Kazakov, Things Should Take a Natural Course', Kommersant-daily, 13 February 1996, pp. 1-2, translated in 'Russia: Deputy Premier on Privatization, New Policy', FBIS-SOV-96-032, 15 February 1996.
52. See interview with Aleksandr Kazakov, Things Should Take a Natural Course', Kommersant-daily, 13 February 1996, pp. 1-2, translated in 'Russia: Deputy Premier on Privatization, New Policy', FBIS-SOV-96-032, 15 February 1996.
53. Chubais accounts for his unpopularity by pointing to the deliberate efforts of his political opponents who 'mounted a massive hatred campaign' and 'invested into deploying a large-scale propaganda move against [me]'. See Nikolai Svanidze's interview with Chubais on 17 January 1996 on the programme 'Details' on Moscow Russian Television Network, translated in 'Chubays Interviewed on "Sudden" Resignation', FBIS-SOV-96-012, 18 January 1996. In news reports, labels like 'the most hated', 'most disliked by the people' and 'most odious' Russian politician have been regularly applied to Chubais. See Leonid Brodsky, 'Personnel Reshuffle in the Government', Kommersant-Daily, 16 January 1996, pp. 1-2 cited in Russian Press Digest, 17 January 1996; For a list of reasons for Chubais' unpopularity, see Yevgeniy Anisimov, 'Chubays Sacrificed on Altar of Reform', Komsomol'skaya Pravda, 18 January 1996, p. 1, cited in 'Chubays "Sacrificed" to Yeltsin Ambitions', FBIS-SOV-96-012, 18 January 1996. For further discussion on Chubais' reputation, see Chrystia Freeland, 'The Kremlin Gatekeeper', Financial Times, 12 October 1996, p. 9 and 'Business Circles Propose Simultaneous Early Elections', Kommersant, 25 September 1993, p. 3.
54. Chubais accounts for his unpopularity by pointing to the deliberate efforts of his political opponents who 'mounted a massive hatred campaign' and 'invested into deploying a large-scale propaganda move against [me]'. See Nikolai Svanidze's interview with Chubais on 17 January 1996 on the programme 'Details' on Moscow Russian Television Network, translated in 'Chubays Interviewed on "Sudden" Resignation', FBIS-SOV-96-012, 18 January 1996. In news reports, labels like 'the most hated', 'most disliked by the people' and 'most odious' Russian politician have been regularly applied to Chubais. See Leonid Brodsky, 'Personnel Reshuffle in the Government', Kommersant-Daily, 16 January 1996, pp. 1-2 cited in Russian Press Digest, 17 January 1996; For a list of reasons for Chubais' unpopularity, see Yevgeniy Anisimov, 'Chubays Sacrificed on Altar of Reform', Komsomol'skaya Pravda, 18 January 1996, p. 1, cited in 'Chubays "Sacrificed" to Yeltsin Ambitions', FBIS-SOV-96-012, 18 January 1996. For further discussion on Chubais' reputation, see Chrystia Freeland, 'The Kremlin Gatekeeper', Financial Times, 12 October 1996, p. 9 and 'Business Circles Propose Simultaneous Early Elections', Kommersant, 25 September 1993, p. 3.
55. Chubais accounts for his unpopularity by pointing to the deliberate efforts of his political opponents who 'mounted a massive hatred campaign' and 'invested into deploying a large-scale propaganda move against [me]'. See Nikolai Svanidze's interview with Chubais on 17 January 1996 on the programme 'Details' on Moscow Russian Television Network, translated in 'Chubays Interviewed on "Sudden" Resignation', FBIS-SOV-96-012, 18 January 1996. In news reports, labels like 'the most hated', 'most disliked by the people' and 'most odious' Russian politician have been regularly applied to Chubais. See Leonid Brodsky, 'Personnel Reshuffle in the Government', Kommersant-Daily, 16 January 1996, pp. 1-2 cited in Russian Press Digest, 17 January 1996; For a list of reasons for Chubais' unpopularity, see Yevgeniy Anisimov, 'Chubays Sacrificed on Altar of Reform', Komsomol'skaya Pravda, 18 January 1996, p. 1, cited in 'Chubays "Sacrificed" to Yeltsin Ambitions', FBIS-SOV-96-012, 18 January 1996. For further discussion on Chubais' reputation, see Chrystia Freeland, 'The Kremlin Gatekeeper', Financial Times, 12 October 1996, p. 9 and 'Business Circles Propose Simultaneous Early Elections', Kommersant, 25 September 1993, p. 3.
56. Chubais accounts for his unpopularity by pointing to the deliberate efforts of his political opponents who 'mounted a massive hatred campaign' and 'invested into deploying a large-scale propaganda move against [me]'. See Nikolai Svanidze's interview with Chubais on 17 January 1996 on the programme 'Details' on Moscow Russian Television Network, translated in 'Chubays Interviewed on "Sudden" Resignation', FBIS-SOV-96-012, 18 January 1996. In news reports, labels like 'the most hated', 'most disliked by the people' and 'most odious' Russian politician have been regularly applied to Chubais. See Leonid Brodsky, 'Personnel Reshuffle in the Government', Kommersant-Daily, 16 January 1996, pp. 1-2 cited in Russian Press Digest, 17 January 1996; For a list of reasons for Chubais' unpopularity, see Yevgeniy Anisimov, 'Chubays Sacrificed on Altar of Reform', Komsomol'skaya Pravda, 18 January 1996, p. 1, cited in 'Chubays "Sacrificed" to Yeltsin Ambitions', FBIS-SOV-96-012, 18 January 1996. For further discussion on Chubais' reputation, see Chrystia Freeland, 'The Kremlin Gatekeeper', Financial Times, 12 October 1996, p. 9 and 'Business Circles Propose Simultaneous Early Elections', Kommersant, 25 September 1993, p. 3.
57. Chubais accounts for his unpopularity by pointing to the deliberate efforts of his political opponents who 'mounted a massive hatred campaign' and 'invested into deploying a large-scale propaganda move against [me]'. See Nikolai Svanidze's interview with Chubais on 17 January 1996 on the programme 'Details' on Moscow Russian Television Network, translated in 'Chubays Interviewed on "Sudden" Resignation', FBIS-SOV-96-012, 18 January 1996. In news reports, labels like 'the most hated', 'most disliked by the people' and 'most odious' Russian politician have been regularly applied to Chubais. See Leonid Brodsky, 'Personnel Reshuffle in the Government', Kommersant-Daily, 16 January 1996, pp. 1-2 cited in Russian Press Digest, 17 January 1996; For a list of reasons for Chubais' unpopularity, see Yevgeniy Anisimov, 'Chubays Sacrificed on Altar of Reform', Komsomol'skaya Pravda, 18 January 1996, p. 1, cited in 'Chubays "Sacrificed" to Yeltsin Ambitions', FBIS-SOV-96-012, 18 January 1996. For further discussion on Chubais' reputation, see Chrystia Freeland, 'The Kremlin Gatekeeper', Financial Times, 12 October 1996, p. 9 and 'Business Circles Propose Simultaneous Early Elections', Kommersant, 25 September 1993, p. 3.
58. Chubais accounts for his unpopularity by pointing to the deliberate efforts of his political opponents who 'mounted a massive hatred campaign' and 'invested into deploying a large-scale propaganda move against [me]'. See Nikolai Svanidze's interview with Chubais on 17 January 1996 on the programme 'Details' on Moscow Russian Television Network, translated in 'Chubays Interviewed on "Sudden" Resignation', FBIS-SOV-96-012, 18 January 1996. In news reports, labels like 'the most hated', 'most disliked by the people' and 'most odious' Russian politician have been regularly applied to Chubais. See Leonid Brodsky, 'Personnel Reshuffle in the Government', Kommersant-Daily, 16 January 1996, pp. 1-2 cited in Russian Press Digest, 17 January 1996; For a list of reasons for Chubais' unpopularity, see Yevgeniy Anisimov, 'Chubays Sacrificed on Altar of Reform', Komsomol'skaya Pravda, 18 January 1996, p. 1, cited in 'Chubays "Sacrificed" to Yeltsin Ambitions', FBIS-SOV-96-012, 18 January 1996. For further discussion on Chubais' reputation, see Chrystia Freeland, 'The Kremlin Gatekeeper', Financial Times, 12 October 1996, p. 9 and 'Business Circles Propose Simultaneous Early Elections', Kommersant, 25 September 1993, p. 3.
59. Chubais accounts for his unpopularity by pointing to the deliberate efforts of his political opponents who 'mounted a massive hatred campaign' and 'invested into deploying a large-scale propaganda move against [me]'. See Nikolai Svanidze's interview with Chubais on 17 January 1996 on the programme 'Details' on Moscow Russian Television Network, translated in 'Chubays Interviewed on "Sudden" Resignation', FBIS-SOV-96-012, 18 January 1996. In news reports, labels like 'the most hated', 'most disliked by the people' and 'most odious' Russian politician have been regularly applied to Chubais. See Leonid Brodsky, 'Personnel Reshuffle in the Government', Kommersant-Daily, 16 January 1996, pp. 1-2 cited in Russian Press Digest, 17 January 1996; For a list of reasons for Chubais' unpopularity, see Yevgeniy Anisimov, 'Chubays Sacrificed on Altar of Reform', Komsomol'skaya Pravda, 18 January 1996, p. 1, cited in 'Chubays "Sacrificed" to Yeltsin Ambitions', FBIS-SOV-96-012, 18 January 1996. For further discussion on Chubais' reputation, see Chrystia Freeland, 'The Kremlin Gatekeeper', Financial Times, 12 October 1996, p. 9 and 'Business Circles Propose Simultaneous Early Elections', Kommersant, 25 September 1993, p. 3.
60. ; The 1992-96 Central and Eastern Eurobarometer surveys reflect deterioration of support for market reform. In 1992 54% of Russians viewed the market positively, 31% in 1993, 22% in 1994 and 19% in 1995; alternatively 25% of Russians viewed the market negatively in 1992, 53% in 1993, 63% in 1994 and 65% in 1995. Central and Eastern European Barometer (henceforth CEE), February 1993, pp. 13-15; CEE, March 1994, pp. 19-22, CEE, March 1995, pp. 26-28; CEE, March 1996, pp. 31-34.
61. ; The 1992-96 Central and Eastern Eurobarometer surveys reflect deterioration of support for market reform. In 1992 54% of Russians viewed the market positively, 31% in 1993, 22% in 1994 and 19% in 1995; alternatively 25% of Russians viewed the market negatively in 1992, 53% in 1993, 63% in 1994 and 65% in 1995. Central and Eastern European Barometer (henceforth CEE), February 1993, pp. 13-15; CEE, March 1994, pp. 19-22, CEE, March 1995, pp. 26-28; CEE, March 1996, pp. 31-34.
62. ; The 1992-96 Central and Eastern Eurobarometer surveys reflect deterioration of support for market reform. In 1992 54% of Russians viewed the market positively, 31% in 1993, 22% in 1994 and 19% in 1995; alternatively 25% of Russians viewed the market negatively in 1992, 53% in 1993, 63% in 1994 and 65% in 1995. Central and Eastern European Barometer (henceforth CEE), February 1993, pp. 13-15; CEE, March 1994, pp. 19-22, CEE, March 1995, pp. 26-28; CEE, March 1996, pp. 31-34.
63. ; The 1992-96 Central and Eastern Eurobarometer surveys reflect deterioration of support for market reform. In 1992 54% of Russians viewed the market positively, 31% in 1993, 22% in 1994 and 19% in 1995; alternatively 25% of Russians viewed the market negatively in 1992, 53% in 1993, 63% in 1994 and 65% in 1995. Central and Eastern European Barometer (henceforth CEE), February 1993, pp. 13-15; CEE, March 1994, pp. 19-22, CEE, March 1995, pp. 26-28; CEE, March 1996, pp. 31-34.
64. For the full text of this press conference, see 'Press Conference By Anatoly Chubais, Deputy Prime Minister', Official Kremlin International News Broadcast, 21 August 1992.
65. Dmitry Vokhrintsev & Natatalya Kalinichenko, 'Chubais calls Privatization Unstoppable', Commersant, 29 September 1992, p. 6.
66. On motivation for participation in privatisation, and on expectations of receiving stable dividends, see poll data from 'O sotsial'nom aspekte privatizatsii', Voprosy ekonomiki, 1996, 4, pp. 73-80.
67. Aslund, Economic Transformation in Russia, p. 1.
68. Out of 7.4 million adult Czech citizens, approximately 6.1 participated. J. Kotrba, 'Privatization Process in the Czech Republic: Players and Winners', in Jan Svejnar (ed.), The Czech Republic and Economic Transition in Eastern Europe (San Diego, CA, Academic Press, Inc., 1995), p. 175. On campaign promises, see Lidove Noviny, 21 January 1992, p. 1.
69. Out of 7.4 million adult Czech citizens, approximately 6.1 participated. J. Kotrba, 'Privatization Process in the Czech Republic: Players and Winners', in Jan Svejnar (ed.), The Czech Republic and Economic Transition in Eastern Europe (San Diego, CA, Academic Press, Inc., 1995), p. 175. On campaign promises, see Lidove Noviny, 21 January 1992, p. 1.
70. Officials from different ministries spoke out against the promises by funds, and discouraged citizens from using the investment privatisation funds, claiming that the screening process for registering funds was still inadequate. CTK National News Service, 30 July 1993; Financial Times, 29 January 1992.
71. Officials from different ministries spoke out against the promises by funds, and discouraged citizens from using the investment privatisation funds, claiming that the screening process for registering funds was still inadequate. CTK National News Service, 30 July 1993; Financial Times, 29 January 1992.
72. Gurkov's 1994 survey research reports that 47.7% of respondents in October 1994 thought that privatisation equalled a robbery of national property. Igor Gurkov et al., The Development of Human Capital in Russian Industries: Scientific Report for the Ministry of Economics, The Russian Federation (Moscow, Higher School of Economics, December 1994).
73. Oneximbank not only organised the auction for shares in the oil company Sidanko, it also guaranteed the loan of its affiliate International Financial Company (IFC), which won the auction at a price that was only 4% higher than the starting price, despite a higher bid by Rossiisky Kredit, whose representatives arrived 24 minutes late. Similarly, in the auction of shares for Norilsk Nickel, Oneximbank failed to award the shares to the highest bidder, Rossiisky Kredit, and determined itself the winner, with a loan guaranteed by IFC. Oneximbank paid a final price that was only $10 000 greater than the starting price, despite Rossiisky Kredit's bid of over twice the final price. Onexim-bank rejected this bid on the basis that Rossiisky Kredit allegedly lacked sufficient financial guarantees. Menatep bank, which organised the auction of the shares in the oil company Yukos, similarly rejected bids from Alfabank and Inkombank because the deposit had been in the form of treasury bills, and instead awarded the shares to Laguna, its own affiliate and whose loan it had guaranteed. For more details of the loans-for-shares auctions, see Russian Economic Trends, 4, 4, 1996; also see articles by Jonas Bernstein, 'Loans for the Sharks', The Moscow Times, 19 December 1995, and 'Oneximbank: Winner With the Inside Track', The Moscow Times, 30 January 1996; on the government's decision for the results of the loans-for-shares auctions to stand, see Segodnya, 26 December 1995, p. 1.
74. Oneximbank not only organised the auction for shares in the oil company Sidanko, it also guaranteed the loan of its affiliate International Financial Company (IFC), which won the auction at a price that was only 4% higher than the starting price, despite a higher bid by Rossiisky Kredit, whose representatives arrived 24 minutes late. Similarly, in the auction of shares for Norilsk Nickel, Oneximbank failed to award the shares to the highest bidder, Rossiisky Kredit, and determined itself the winner, with a loan guaranteed by IFC. Oneximbank paid a final price that was only $10 000 greater than the starting price, despite Rossiisky Kredit's bid of over twice the final price. Onexim-bank rejected this bid on the basis that Rossiisky Kredit allegedly lacked sufficient financial guarantees. Menatep bank, which organised the auction of the shares in the oil company Yukos, similarly rejected bids from Alfabank and Inkombank because the deposit had been in the form of treasury bills, and instead awarded the shares to Laguna, its own affiliate and whose loan it had guaranteed. For more details of the loans-for-shares auctions, see Russian Economic Trends, 4, 4, 1996; also see articles by Jonas Bernstein, 'Loans for the Sharks', The Moscow Times, 19 December 1995, and 'Oneximbank: Winner With the Inside Track', The Moscow Times, 30 January 1996; on the government's decision for the results of the loans-for-shares auctions to stand, see Segodnya, 26 December 1995, p. 1.
75. Oneximbank not only organised the auction for shares in the oil company Sidanko, it also guaranteed the loan of its affiliate International Financial Company (IFC), which won the auction at a price that was only 4% higher than the starting price, despite a higher bid by Rossiisky Kredit, whose representatives arrived 24 minutes late. Similarly, in the auction of shares for Norilsk Nickel, Oneximbank failed to award the shares to the highest bidder, Rossiisky Kredit, and determined itself the winner, with a loan guaranteed by IFC. Oneximbank paid a final price that was only $10 000 greater than the starting price, despite Rossiisky Kredit's bid of over twice the final price. Onexim-bank rejected this bid on the basis that Rossiisky Kredit allegedly lacked sufficient financial guarantees. Menatep bank, which organised the auction of the shares in the oil company Yukos, similarly rejected bids from Alfabank and Inkombank because the deposit had been in the form of treasury bills, and instead awarded the shares to Laguna, its own affiliate and whose loan it had guaranteed. For more details of the loans-for-shares auctions, see Russian Economic Trends, 4, 4, 1996; also see articles by Jonas Bernstein, 'Loans for the Sharks', The Moscow Times, 19 December 1995, and 'Oneximbank: Winner With the Inside Track', The Moscow Times, 30 January 1996; on the government's decision for the results of the loans-for-shares auctions to stand, see Segodnya, 26 December 1995, p. 1.
76. Oneximbank not only organised the auction for shares in the oil company Sidanko, it also guaranteed the loan of its affiliate International Financial Company (IFC), which won the auction at a price that was only 4% higher than the starting price, despite a higher bid by Rossiisky Kredit, whose representatives arrived 24 minutes late. Similarly, in the auction of shares for Norilsk Nickel, Oneximbank failed to award the shares to the highest bidder, Rossiisky Kredit, and determined itself the winner, with a loan guaranteed by IFC. Oneximbank paid a final price that was only $10 000 greater than the starting price, despite Rossiisky Kredit's bid of over twice the final price. Onexim-bank rejected this bid on the basis that Rossiisky Kredit allegedly lacked sufficient financial guarantees. Menatep bank, which organised the auction of the shares in the oil company Yukos, similarly rejected bids from Alfabank and Inkombank because the deposit had been in the form of treasury bills, and instead awarded the shares to Laguna, its own affiliate and whose loan it had guaranteed. For more details of the loans-for-shares auctions, see Russian Economic Trends, 4, 4, 1996; also see articles by Jonas Bernstein, 'Loans for the Sharks', The Moscow Times, 19 December 1995, and 'Oneximbank: Winner With the Inside Track', The Moscow Times, 30 January 1996; on the government's decision for the results of the loans-for-shares auctions to stand, see Segodnya, 26 December 1995, p. 1.
77. On the connection between the loans-for-shares scandal and forgone revenue to pay state workers, see Russian economist Aleksandr Minkin, 'State Cannibalism: To Russian Prime Minister V. S. Chernomyrdin', Moskovskii Komsomolets, 26 December 1995, pp. 1, 2, translated in 'Favoritism in Privatization Criticized', FBIS-SOV-96-023-S, 2 February 1996, pp. 8, 9.
78. On the connection between the loans-for-shares scandal and forgone revenue to pay state workers, see Russian economist Aleksandr Minkin, 'State Cannibalism: To Russian Prime Minister V. S. Chernomyrdin', Moskovskii Komsomolets, 26 December 1995, pp. 1, 2, translated in 'Favoritism in Privatization Criticized', FBIS-SOV-96-023-S, 2 February 1996, pp. 8, 9.
79. See Blasi et al., Kremlin Capitalism ..., pp. 76-78.
80. A. Aslund, Financial Times, 31 May 1996. For a more detailed discussion of rent seeking and wealth accumulation in Russia, see Anders Aslund, 'Reform Vs. "Rent-Seeking" In Russia's Economic Transformation', Transition, 26 January 1996, pp. 12-16.
81. A. Aslund, Financial Times, 31 May 1996. For a more detailed discussion of rent seeking and wealth accumulation in Russia, see Anders Aslund, 'Reform Vs. "Rent-Seeking" In Russia's Economic Transformation', Transition, 26 January 1996, pp. 12-16.
82. For excerpts see 'Chubais to Blame for Poor Showing for NDR - Yeltsin', ITAR-TASS Russian News Service, 19 January 1996.
83. El'tsin's remarks quoted in Janet Gultsman, 'Yeltsin Says Still Pro-Reform, Scathing on Chubais', Reuters Financial Service, 19 January 1996. El'tsin also accounted for Chubais' dismissal by citing unforgivable mistakes in his privatisation programme, such as generating only 8000 billion rubles in revenue in all of Russia when the mayor of Moscow was able to generate 6000 billion rubles in the same time period in the capital city alone. ITAR-TASS World Service, 16 February 1996, cited in 'Russia: Yeltsin Notes Main Tasks of Privatization', FBIS-SOV-96-33, 16 February 1996.
84. El'tsin's remarks quoted in Janet Gultsman, 'Yeltsin Says Still Pro-Reform, Scathing on Chubais', Reuters Financial Service, 19 January 1996. El'tsin also accounted for Chubais' dismissal by citing unforgivable mistakes in his privatisation programme, such as generating only 8000 billion rubles in revenue in all of Russia when the mayor of Moscow was able to generate 6000 billion rubles in the same time period in the capital city alone. ITAR-TASS World Service, 16 February 1996, cited in 'Russia: Yeltsin Notes Main Tasks of Privatization', FBIS-SOV-96-33, 16 February 1996.
85. El'tsin's remarks quoted in Janet Gultsman, 'Yeltsin Says Still Pro-Reform, Scathing on Chubais', Reuters Financial Service, 19 January 1996. El'tsin also accounted for Chubais' dismissal by citing unforgivable mistakes in his privatisation programme, such as generating only 8000 billion rubles in revenue in all of Russia when the mayor of Moscow was able to generate 6000 billion rubles in the same time period in the capital city alone. ITAR-TASS World Service, 16 February 1996, cited in 'Russia: Yeltsin Notes Main Tasks of Privatization', FBIS-SOV-96-33, 16 February 1996.
86. Elena Medvedeva, 'Goskomimushchestvo priznaet vse, krome byudzhetnogo zadaniya' Kommersant-daily, 5 April 1996, p. 6; Aleksandr Bekker, 'GKI vstupaet v konkurentsiyu s kommunistami: privatizatsionnoe vedomstvo gotovit zakon o natsionalizatsii', Segodnya, 21 March 1996, p. 1; ITAR-TASS, 4 April 1996; Moskovskie novosti, 1996, 5, 4-11 February 1996, p. 19 (on Duma).
87. Elena Medvedeva, 'Goskomimushchestvo priznaet vse, krome byudzhetnogo zadaniya' Kommersant-daily, 5 April 1996, p. 6; Aleksandr Bekker, 'GKI vstupaet v konkurentsiyu s kommunistami: privatizatsionnoe vedomstvo gotovit zakon o natsionalizatsii', Segodnya, 21 March 1996, p. 1; ITAR-TASS, 4 April 1996; Moskovskie novosti, 1996, 5, 4-11 February 1996, p. 19 (on Duma).
88. Elena Medvedeva, 'Goskomimushchestvo priznaet vse, krome byudzhetnogo zadaniya' Kommersant-daily, 5 April 1996, p. 6; Aleksandr Bekker, 'GKI vstupaet v konkurentsiyu s kommunistami: privatizatsionnoe vedomstvo gotovit zakon o natsionalizatsii', Segodnya, 21 March 1996, p. 1; ITAR-TASS, 4 April 1996; Moskovskie novosti, 1996, 5, 4-11 February 1996, p. 19 (on Duma).
89. Elena Medvedeva, 'Goskomimushchestvo priznaet vse, krome byudzhetnogo zadaniya' Kommersant-daily, 5 April 1996, p. 6; Aleksandr Bekker, 'GKI vstupaet v konkurentsiyu s kommunistami: privatizatsionnoe vedomstvo gotovit zakon o natsionalizatsii', Segodnya, 21 March 1996, p. 1; ITAR-TASS, 4 April 1996; Moskovskie novosti, 1996, 5, 4-11 February 1996, p. 19 (on Duma).