Helping hand or grabbing hand? State bureaucracy and privatization effectiveness

Arbeitspapier

Why have economic reforms aimed at reducing the role of the state been successful in some cases but not others? Are reform failures the consequence of leviathan states that hinder private economic activity, or of weak states unable to implement policies effectively and provide a supportive institutional environment? We explore these questions in a study of privatization in postcommunist Russia. Taking advantage of large regional variation in the size of public administrations, and employing a multilevel research design that controls for pre-privatization selection in the estimation of regional privatization effects, we examine the relationship between state bureaucracy and the impact of privatization on firm productivity. We find that privatization is more effective in regions with relatively large bureaucracies. Our analysis suggests that this effect is driven by the impact of bureaucracy on the post-privatization business environment, with better institutional support and less corruption when bureaucracies are large.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 3958

Classification and Topics

• Classification: Wirtschaft ; Structure, Scope, and Performance of Government ; Comparison of Public and Private Enterprises and Nonprofit Institutions; Privatization; Contracting Out ; Socialist Systems and Transitional Economies: Factor and Product Markets; Industry Studies; Population ; Socialist Systems and Transitional Economies: Political Economy; Property Rights ; Socialist Systems and Transitional Economies: Legal Institutions; Illegal Behavior ; Other Economic Systems: Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies
• Subject: Privatization ; bureaucracy ; economic reform ; Russia ; Bürokratie ; Wirtschaftsreform ; Privatisierung ; Wirkungsanalyse ; Russland

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Brown, J. David ; Earle, John S. ; Gehlbach, Scott
• Event: Veröffentlichung
• (who): Institute for the Study of Labor (IZA)
• (where): Bonn
• (when): 2009

Further information

• Handle: http://hdl.handle.net/10419/35408
• URN: urn:nbn:de:101:1-20090209286
• Last update: 10.03.2025, 11:44 AM CET