Who Will Own “Nobody’s Property”? The Perils of Russian Privatization

At the beginning of Gorbachev’s perestroika, a number of economists expressed the idea that so-called “socialist property” essentially belonged to no one—it lacked a subject. But the well-being of those who managed this property in the name of the state directly depended neither on the size of the property under their authority nor on its effective use. Complete or partial property losses due to bad management did not lead to those severe consequences that an entrepreneur experiences in the West. The state simply registered the losses. In a word, the changing of property rights was put forward even at that time as the principal item of an economic reform designed to make interest in profit the moving force of developm...