Uncertainty as a Factor in Investment Decisions: The Case of the Russian Federation's Regions

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

State-Business Relations and Access to External Financing

“…The survey was conducted by the HSE University in 2014 and contains information about 1,950 rms from 60 Russian regions. 3 The same survey was used by (Levina et al, 2016) Did your rm receive any nancial support from federal, regional, and municipal government in 20122013? (Give one answer in each row) .…”

The state and company managements in Belarus

“…Recent research into entrepreneurial orientation and investment decisions of Russian SMEs found that operating in unstable institutional environment characterised by a large 'shadow economy' compels many companies to make decisions based on the information obtained from informal, sometimes, illegal contacts they develop with the local officials in order to circumvent the limitations imposed by formal rules and regulations (Wales et al, 2016). Unfortunately, large inconsistencies in informal relations combined with instability in the protection of private property rights leave many Russian companies exposed to private raiding, creating fundamental threats to their existence (Levina et al, 2016).…”