TY  - JOUR
AU  - Treisman,Daniel
TI  - "Loans for Shares" Revisited
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 15819
PY  - 2010
Y2  - March 2010
UR  - http://www.nber.org/papers/w15819
L1  - http://www.nber.org/papers/w15819.pdf
N1  - Author contact info:
Daniel Treisman
Department of Political Science
UCLA
4289 Bunche Hall
Los Angeles, CA 90095-1472
Tel: 310/794-5875
Fax: 310/825-0778
E-Mail: treisman@polisci.ucla.edu
AB  - The "loans for shares" scheme of 1995-6—in which a handful of well-connected businessmen bought stakes in major Russian companies—is widely considered a scandal that slowed subsequent Russian economic growth. Fifteen years later, I reexamine the details of the program. In light of evidence available today, I concur with the critics that the scheme’s execution appeared corrupt. However, in most other regards the conventional wisdom was wrong. The stakes involved represented a small fraction of the market; the pricing in most cases was in line with international practice; and the scheme can only explain a small part of Russia's increasing wealth inequality. The biggest beneficiaries were not the so-called "oligarchs," but Soviet era industrial managers. After the oligarchs consolidated control, their firms performed far better than comparable state enterprises and companies sold to incumbent managers, and helped fuel Russia’s rapid growth after 1999.
ER  -