Business and state in the developing world
Subtitle: three essays on institution-building
By: by Stanislav Markus
Published: 2009
Language: eng
Number of pages: 113
Description: Political mobilization of business forces in the post-communist world has crucial implications for economic development and civil society. The first essay examines the emergence of strong cross-sectoral business associations during Putin's presidency. At the theoretical level, collective action by socioeconomic groups is linked to severe principal-agent dilemmas common to many ex-socialist bureaucracies. Given institutionally incoherent state structures, the state as principal facilitates collective action by business actors to create a parallel, non-state platform for policy formation and implementation. Such a dynamic of "debilitated dirigisme" should be understood in the comparative contexts of business mobilization in Latin America, Asia, and the advanced industrialized world. What do we know about the politics of corporate governance in emerging markets? While the state-level institutions have been amply explored, firm-level dynamics remain under-theorized. Complementing the orthodox emphasis on external finance as causal force behind the adoption of "minority shareholder protections", the second essay outlines an alternative mechanism for firms operating in political settings with heightened risk of state intrusion. The Anglo-Saxon governance institutions can serve domestic managers as a strategy to build alliances with foreign stakeholders so as to counteract a dirigiste government. Empirically, the focus is on the implementation of internationally accepted standards of corporate governance by Russia's big business between 1999 and 2004.

How do property rights become secure? Rather than emphasizing the state, the third essay investigates the role of firms to address these fundamental issues of political economy. The literature proceeds from the assumption of a strong and rational sovereign, yet most states in the developing world lack long time horizons and institutionally capacity. In this context, I argue that firms can enforce their property rights through alliances with stakeholders such as foreign actors, community residents, labor, and other firms. These stakeholders can impose costs on the potential aggressors through diverse mechanisms. Empirically, case studies and an original large-N survey of 516 firms in Russia and Ukraine are used to test the hypothesis that stakeholder alliances have significant deterrence capacity.
Notes: "October 2008."

Thesis (Ph.D., Dept. of Government)--Harvard University, 2009.

Includes bibliographical references.