Academic journal article European Research Studies

Effective State Ownership Administration in the Context of the Privatization Process in Russia

Academic journal article European Research Studies

Effective State Ownership Administration in the Context of the Privatization Process in Russia

Article excerpt

1. Introduction

Strategic objectives of Russian modernization, including innovation development, need changes. Property relations have impact on the quality of the institutional environment that forms the innovative growth potential.

By innovative development the author means economy based on knowledge, innovations and continuous technological improvement. It involves production and export of hi-tech goods with high additional cost, including export of technologies. Innovative economy is capable to use any innovations effectively and implies the corresponding innovative infrastructure: legislative base, material components of the innovative system and institutional transformations of state ownership. More than that, it includes six basic elements: (1) education; (2) science; (3) human capital and high quality of life; (4) innovative system; (5) innovative industry; (6) effective public administration (favorable environment of innovative system functioning).

Institutional transformation of state ownership is one of the growth factors. This is the subject of scientific research in such fields as institutional economics (Coase, 1960; Alchian & Demsetz, 1973; Pejovich, 1990), public choice theory (Buchanan, 1978), and the theory of "collective action" (Olson, 1982). Scientists unanimously indicate the need for the increase of effectiveness in state ownership management (Clague, Keefer, Knack, & Olson, 1997; Cox, 2008; Pargendler, 2012; Marra & Cariei, 2014). The problems of effective use of state ownership are of interest from the practical point of view.

The quantitative structure of the Russian state property fund has been changed in connection with the long-term period of state ownership privatization and approaches to it. The authorities consider modern privatization, firstly, as the instrument of investment attraction in public sector; secondly, as the instrument of competition development; and thirdly, as the instrument of state ownership involvement into the macroeconomic system. New algorithms of privatization are reflected in "The concept of federal property management until 2018" (Federal Agency for State Property Management [Rosimushchestvo], 2015)

The system of socio-economic goals in state ownership administration involves a number of requirements to form an effective property structure--it has to include preferences of all main consumers: population, corporate sector, authorities, and investors. However, the necessity to improve the system of state ownership management is defined by the low level of consumers' satisfaction and growing market requirements.

The concern of this article is to explain and understand the problems of effective state ownership administration in Russia, to develop a methodological base to assess it, and to suggest directions for the improvement of the management system. The key points of the research are reflected in the following sections: literature review and methodology, results, and discussion.

The first section of the article reviews the theoretical basis concerning the influence of property rights protection on economic development. The author offers a system of indicators to measure the effectiveness of state ownership administration. The second part describes the purposes and the problems of modern state policy in the field of property administration; in particular, new instruments of administration are discussed. Also in this section author proposes ways to increase the effectiveness of state ownership administration. The author is sure that transformations in the system of state ownership management have to improve the structure as a whole; they must include both legislative regulations and improvement of the management process. Responsibility and motivation problems of the civil service management system, which are one of the ways to improve the management process, are discussed in the second part. …

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