Oligarchs: The Past or the Future of Russian Capitalism?
35 Pages Posted: 31 Aug 2004
Date Written: July 2004
Based mostly on a unique dataset built for the Country Economic Memorandum (CEM) 2004 we discuss degree of ownership concentration in Russian economy and its role in shaping economic and political institutions in Russia. In particular, we find that Russian 'oligarchs' do control a substantial part of the economy including natural resources industries. In the sectors covered by our sample (that account for 77% of total industrial output), 22 largest private owners control 39-42% of output and employment and seem to run their empires more efficiently than other Russian owners. Majority of Russian population believes that oligarchs acquired their assets in an illegitimate way which creates a fundamental problem for building a democratic and prosperous Russia. Comparing modern Russia to other countries that have faced high concentration of national wealth, we consider three possible scenarios of development.
Keywords: Oligarchs, ownership concentration, property rights
JEL Classification: P26
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