Management Quality, Ownership, Firm Performance and Market Pressure in Russia

Open Economies Review, February 2013

29 Pages Posted: 25 Nov 2012 Last revised: 6 Mar 2013

See all articles by Guido Friebel

Guido Friebel

Goethe University Frankfurt; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Helena Schweiger

European Bank for Reconstruction and Development (EBRD) - Office of the Chief Economist

Date Written: February 27, 2013

Abstract

We investigate whether management quality explains firm performance in Russia. We find that it explains relatively little in terms of firm performance, but it does explain some of the differences between firms in Russia’s Far East and the rest of Russia. Firms that have always been in private ownership perform better than state-owned firms. While management practices may not yet affect firm performance in a measurable way, they may do so in the future. This conjecture motivates us to look at the determinants of firms’ adoption of good management practices. We find that market pressure, both in the product and the labour market, has some impact on adoption of management practices, in particular in the Far East. It thus appears that the economy in Russia’s Far East may function according to different rules than in the rest of Russia, as market forces seem to be stronger there, in particular, because the Far East is more exposed to foreign competition than the rest of Russia.

Keywords: transition, firm restructuring, open economies

JEL Classification: L2, M2, P2

Suggested Citation

Friebel, Guido and Schweiger, Helena, Management Quality, Ownership, Firm Performance and Market Pressure in Russia (February 27, 2013). Open Economies Review, February 2013, Available at SSRN: https://ssrn.com/abstract=2180448 or http://dx.doi.org/10.2139/ssrn.2180448

Guido Friebel

Goethe University Frankfurt ( email )

Grüneburgplatz 1
Frankfurt am Main, 60323
Germany

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Helena Schweiger (Contact Author)

European Bank for Reconstruction and Development (EBRD) - Office of the Chief Economist ( email )

One Exchange Square
London EC2A 2JN
United Kingdom

HOME PAGE: http://www.helenasch.net

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