finding supports the view that some municipal policy makers, beyond their desire to deter land privatization and preserve revenues from land rents, may be also creating (or maintaining) opportunities for corruption.

7. However, the procedure duration, controlling for complexity and official fees, does not significantly affect the level of unofficial payments for a land-related procedure (except perhaps in conjunction with procedures associated with “sunk costs” for investors, as noted above).

8. The official cost of the procedures, along with the complexities associated with them, has a significant effect on the level of unofficial payments – holding other variables constant, the higher the official cost, the higher the level of unofficial payments.

9. Established relationships with government officials may help to reduce the duration of the process somewhat, although their effect is not significant. However, such connections cost money to maintain – intermediaries who have connections that they think can help in facilitation of their work charge more for completion of procedures. In other words, it appears that many intermediaries may market themselves as “facilitators”, but the data suggest that the benefits of using a facilitator might not be worth the extra cost. It is still possible that facilitators are hired precisely in the most difficult cases (that may be more expensive in order to deal with the complexity), but our efforts to control for such situations (e.g., using the size of a land parcel as a proxy for complexity) did not yield significant results. Other proxies (e.g., the market value of a land parcel) might be more appropriate for this analysis, but are not yet available.

10. The use of auctions or tenders is still not very common in many regions, and while the data suggest that use of such mechanisms is associated with higher rates of land privatization, there is not yet clear evidence that they are associated with other positive outcomes such as fewer delays or unofficial payments. Here the biggest story is simply the fact that very few such transactions have taken place, as reflected both by the FIAS survey, official data published by Roskomstat and anecdotal evidence (e.g. interviews within several different regions). While we hoped an expected to find a correlation between regions who rely more heavily on auctions and other indicators of market-friendly efficiency and “transparency”, the data do not (yet) support such a conclusion.

11. Policy implications to consider, in light of the findings, including the following:

- Unnecessary complexity (e.g., unnecessary steps in procedures) should be reduced in administrative procedures for businesses’ access to land. This is likely to reduce both unnecessary delays and corruption. Regions with the simplest procedures should serve as a positive example for regions with more complex procedures. There appears to be little evidence from any source that simpler procedures, already within operation within the Russian Federation, are associated with any failure to preserve state interests or public welfare.

- Keeping land privatization prices low (i.e., administered prices for land under buildings that have already been privatized) helps to encourage land privatization transactions and helps to develop a competitive secondary market in land. This in turn allows for much more flexibility in real estate markets, which is associated with higher rates of investment and productivity. Most businesses also note that ownership of land helps them secure medium-longer time finance (e.g., mortgages) more easily than a long-term lease, which (in practice in the Russian Federation) is less than fully marketable. At the same time, if municipalities can not obtain revenues from land rents, they may need some compensating source of revenue (e.g., enhanced land taxes) to maintain their fiscal balances.

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