Generate QR code
Open Access
Subscription Access
Post-Soviet Privatization in the Light of the Coase Theorem (Transaction Costs and Governance Costs)
https://doi.org/10.32609/0042-8736-2003-12-120-136
Abstract
A Coasian theoretical perspective is assumed to be in the background of most post-Soviet economies' privatization drives. The assumption of zero transaction costs underlying the Coase theorem guarantees an efficient reallocation of property rights whatever is their initial distribution. Once this assumption is relaxed, the result predicted by the Coase theorem is less certain and clashes with the nature of the firm as it has been analyzed earlier by Coase himself. This preliminary presentation is used as a critical driver to provide a non-mainstream assessment of privatization objectives in Russia that became so obviously high in the early years of the transition process. A Coasian analysis also helps to figure out the post-privatization firm boundaries and to design in-house restructuring as well as industrial restructuring - between industrial branches. The issue of the firm boundaries is crucial in the relationship between privatization and restructuring. Finally, we come to terms with the analysis of post-privatization property rights and corporate governance and their possible (governance) costs for in-house restructuring. The last section is devoted to an evaluation of standard and non-standard methods of privatization.
References
1. Andreff W. Corporate Governance of Privatized Enterprises in Transforming Economies: A Theoretical Approach // MOCT-MOST. Economic Policy in Transitional Economies, 1996, vol. 6, No 2.
2. Andreff W. French Privatization Techniques and Experience: A Model for Central-Eastern Europe? In: F. Targetti (ed.), Privatization in Europe: West and East Experiences, Aldershot, Dartmouth, 1992.
3. Andreff W. La mutation des economies postsocialistes. Une approche economique alternative. Paris: L’Harmattan, 2003.
4. Andreff W. Privatisation and Corporate Governance in Transition Countries: Beyond the Principal-Agent Model. In: Rosenbaum E., Bonker F., Wagener H.-J. (eds.). Privatization, Corporate Governance and the Emergence of Markets. London: Macmillan, 2000.
5. Berle A., Means G. The Modern Corporation and Private Property. New York: Macmillan, 1932.
6. Blasi J., M. Kroumova, D. Kruse Kremlin Capitalism. Privatizing the Russian Economy. Ithaca: Cornell University Press, 1997.
7. Bornstein M. Non-standard Methods in the Privatization Strategies of the Czech Republic, Hungary and Poland // Economics of Transition, 1997, vol. 5, No 2.
8. Chandler A. Strategy and Structure. Chapters in the History of the Industrial Enterprise. Cambridge (Mass.): The MIT Press, 1962.
9. Coase R. Industrial Organization: A Proposal for Research [1972]. In: Williamson O., Masten S. (eds.). The Economics of Transaction Costs. Cheltenham: Edward Elgar, 1999.
10. Coase R. The Nature of the Firm // Economica, 1937, November.
11. Coase R. The Problem of Social Cost // Journal of Law and Economics, 1960. vol. 3, No 1.
12. Cooter R. Coase Theorem. In: Eatwell J., Milgate M., Newman P. (eds.). The New Palgrave: A Dictionary of Economics. London: Macmillan, 1987, p. 458
13. Easterbrook F., Fischel D. The Economic Structure of Corporate Law. Cambridge (Mass.): Harvard University Press, 1991.
14. Estrin S. Competition and Corporate Governance in Transition // Journal of Economic Perspectives, 2000, vol. 16, No 1.
15. Fama E., Jensen M. Agency Problems and Residual Claims // Journal of Law and Economics, 1983, vol. 26, No 2.
16. Fama E., Jensen M. Separation of Ownership and Control // Journal of Law and Economics, 1983, vol. 26, No 2.
17. Furubotn E., Pejovich S. (eds.). The Economics of Property Rights. Cambridge (Mass.): Ballinger, 1974.
18. Grosfeld I., Roland G. Defensive and Strategic Restructuring in Central European Enterprises // Emergo: Journal of Transforming Economies and Societies, 1995, vol. 3. No 4.
19. Jensen M., Meckling W. Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure // Journal of Financial Economics, 1976, vol. 3, No 1.
20. Joskow P., Schmalensee R. Privatization in Russia: What Should Be a Firm? In: Menard C. (ed.). Transaction Cost Economics. Recent Developments. Cheltenham: Edward Elgar, 1997.
21. Joskow P., Schmalensee R., Tsukanova N. Competition Policy in Russia During and After Privatization. Brookings Papers on Economic Activity: Microeconomics, 1994.
22. Murrell P. Institutions and Firms in Transition Economies. In: C. Menard, M. Shirley (eds.). Handbook of New Institutional Economics. Dordrecht: Kluwer, 2003.
23. Nellis J. The World Bank, Privatization, and Enterprise Reform in Transition Economies. A Retrospective Analysis // Transition Newsletter, 2002, vol. 13, No 1.
24. Pinto B., van Wijnbergen S. Ownership and Corporate Control in Poland: Why State Firms Defied the Odds. CEPR Discussion Paper Series, No 1273, 1995, December.
25. Rapaczynski A. The Roles of the State and the Market in Eastablishing Property Rights // Journal of Economic Perspectives, 1996, vol. 10, No 1, p. 87-103
26. Roland G. Transition and Economics. Politics, Markets and Firms. Cambridge (Mass.): The MIT Press, 2000.
27. Shleifer A., Vishny R. A Survey of Corporate Governance // Journal of Finance, 1997, vol. 52, No 2.
28. Stiglitz J. Whither Socialism? Cambridge, (Mass): The MIT Press, 1994.
29. Tirole J. Privatization in Eastern Europe: Incentives and the Economics of Transition. In: Blanchard O., Fischer S., (eds.). NBER Macroeconomic Annual. Cambridge (Mass.): The MIT Press, 1991.
30. Williamson O. Markets and Hierarchies. Analysis and Anti-trust Implications. New York: Free Press, 1975.
Review
For citations:
Andreff V. Post-Soviet Privatization in the Light of the Coase Theorem (Transaction Costs and Governance Costs). Voprosy Ekonomiki. 2003;(12):120-136. (In Russ.) https://doi.org/10.32609/0042-8736-2003-12-120-136
Views:
1280
Email this article 
