Two Steps Forward or Two Steps Back? Institutional Change in Post-Soviet Russia

Abstract

Much of the research on the socioeconomic transformations that shook Russia in the 1990s has focused on two interrelated themes: the path-dependent nature of insti tutional change and the nature of the post socialist stratification order. Each of the books reviewed here advances the discussion of these two topics, albeit from different angles. In my comments I suggest several ways to improve the level of debate about institutional change and distributional out comes in contemporary Russia, including the need for more detailed attention to eco nomic transactions among firms and house holds in order to balance path-dependencies with an appreciation for the manner in which markets are shaping incentives and thereby generating social change. How Russia Really Works is based on inter views the author conducted between 1997 and 2003 with 50 informants, including busi nesspeople, journalists, law enforcement offi cials, accountants, and legal experts. In the book, Ledeneva shows how defects in the formal structure of Russian society have forced individuals and organizations to rely on informal practices, many of which date back to the Soviet period, to achieve their goals. The author devotes separate chapters to six informal practices in particular: chernyi piar (the release of negative information about candidates for political office), kompro mat (the gathering of compromising infor mation on politicians and businessmen for purposes of blackmail), krugovaia poruka (the mutual cover-up of illicit activities within elite circles), tenevoi barter (reliance barter chains, surrogate financial instruments, and other non-market mechanisms of exchange), dvoinaia bukhgalteriia (double accounting and other financial schemes which allow entre preneurs to avoid taxes and export capital abroad), and, last but not least, tolkachi (the Owning Russia: The Struggle over Factories, Farms, and Power, by Andrew Barnes. Ithaca, NY: Cornell University Press, 2006. 273pp. $35.00 cloth. ISBN: 9780801444340.