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
Date Written: February 27, 2013
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: Suggested Citation