The Impact of Monopolies on Small Business Development in Russia

Abstract

The imposition of economic sanctions on Russia by other countries has raised interest rates, diminished the working capital of small and medium-sized enterprises (SMEs), and led to the restoration of state-owned companies in many sectors of the economy. Nevertheless, the Russian Federation continues to make efforts to develop a market-oriented economy based on open competition. This article considers the current situation with SMEs in Russia from the standpoint of market competition and the influence of monopolies on this process. It analyzes bottlenecks in the interaction of monopolies with SMEs. For example, the wires and pipelines required to distribute energy, heat, and electricity over large geographic areas are natural monopolies: only one company can provides each service efficiently in a given area. The companies that control those natural monopolies are able to extract payments far in excess of cost from small businesses. In this and other ways, monopolies are able to dominate the Russian economy and restrict competition from SMEs.

Evaluation of the Impact of Firm Level Competition on Russian Innovation

“…Each system is therefore characterised by various types of competitions. A national economy dominated by state-owned enterprises differs dramatically from an economy that encourages open competition among many producers (Mierin et al, 2019). The economic system determines the effectiveness of competition in the economy.…”

“…The transition of the Russian economic system in 1991 from a planned economy to a market economy was based on the establishment of three principles: equality of all forms of ownership, entrepreneurial freedom, and competition (Mierin et al, 2019). In light of this, the Russian government instituted the Federal Antimonopoly Service (FAS).…”

Deep Learning Based Model for Predicting the Contribution of SMEs to the Economy

“…KOBİ'ler ürün tasarımı, fiyatlar ve verimlilik için rekabeti teşvik eder. KOBİ'ler olmasaydı, büyük işletmeler hemen hemen tüm faaliyet alanlarında tekel olurlardı [18]. KOBİ'ler büyük şirketlere, daha iyi tedarik edebildikleri bazı faaliyet alanlarında yardımcı olur.…”