Transition strategy, corporate exploitation, and state capture: An empirical analysis of the former Soviet states

Abstract

It is difficult to find, at a glance, a clear connection between corruption and the reform processes in the states of the former Soviet Union (FSU). The key to untangling this issue is to look at the peculiarities of their transition strategies and economic crisis compared with those of Central and East European countries. This paper aims to unravel the complex ties between the transition process and corruption in the FSU states through theoretical and empirical analyses of the impact of multiple factors. These factors include the extent of decentralization of the government–enterprise relationship and the degree of state intervention in corporate management as well as the impact of economic distress that have been affecting the frequency and degree of corporate exploitation and state capture. In this manner, our study aims to complement earlier achievements in this field.