A review of bank performance during transition in central Europe |
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| Authors: | Yurii Perevalov Ilya Gimadii Vladimir Dobrodei |
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| Institution: | 1. Michael Borish and Company , 8607 Second Avenue, Suite 405‐A, Silver Spring, MD, 20910, USA;2. Lend Specialist Operations Unit, World Bank, Europe and Central Asia Private Sector and Financial Sector Development Department , 1818 H Street NW, Washington DC, 20433, USA;3. Principal Economist, Poverty Reduction and Economic Management Department , World Bank, Europe and Central Asia Unit |
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| Abstract: | This study, based on panel data from 189 industrial enterprises in 1992‐96, shows that privatisation 'on average' produces little improvement in performance of Russian enterprises. However, disaggregating the process, we reveal that methods of privatisation do influence performance but the impact is not always positive. The state seems to be a passive shareholder. At the same time, our results suggest that majority state ownership is preferable to a state minority stockholding, possibly because the absence of a monitoring shareholder in the latter case does not permit managers to achieve their own objectives at the expense of other shareholders. |
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