Privatization and survival - evidence from a Russian firm survey

Sprenger, C. (2014) Privatization and survival - evidence from a Russian firm survey. Economic Annals, 59(200), pp. 43-60. (doi: 10.2298/EKA1400043S)

Abstract

This study is dedicated to an important aspect of the long-run performance of firms, namely their survival under rapidly changing conditions in a transition economy. The analysis is focused on the question of whether privatization and ownership structure have affected the likelihood of liquidation and bankruptcy of firms in Russia. We use a sample of 497 privatized and non-privatized firms that were surveyed in 1999-2000, and for which information was collected about their survival status and reasons for exit, such as bankruptcy, mergers and court decisions. More than 38% of the sample firms were liquidated over the period 1999 to 2013. We find that privatization and the choice of privatization option have no effect on the long-term survival of firms in Russia, but that managerial ownership lowers the likelihood of both liquidation and bankruptcy. Other transition-specific predictors of bankruptcy, such as the extent of price controls and the amount of wage arrears, affect firm exit in a significant way.

• Item Type: Articles
• Additional Information: This study was supported by the Research Fund of the National Research University Higher School of Economics in 2012-2013, Grant No. 11-01-0242.
• Status: Published
• Refereed: Yes
• Glasgow Author(s) Enlighten ID: Sprenger, Dr Carsten
• Authors: Sprenger, C.
• College/School: College of Social Sciences > Adam Smith Business School > Economics
• Journal Name: Economic Annals
• Publisher: University of Belgrade, Faculty of Economics
• ISSN: 0013-3264
• ISSN (Online): 1820-7375