ABSTRACT
Russia in the 1990s was referred to frequently by the business world as ‘the Wild East’, a phrase that conjured up images of untamed frontiers – of lawlessness and disputes settled not by the courts, but by violence, and a land of opportunity affording an environment of high risk and high returns. After the collapse of communism in Russia, the restructuring of enterprises, which had to be accomplished under conditions of institutional weakness, was critical to a systemic change from centrally planned to market-based economies. Market-supporting institutions, such as a legal framework ensuring the protection of property rights, a well-regulated financial system, and efficient and liquid capital markets, were nascent. Economic and political instability, combined with the state's weakened administrative capacity and the weak rule of law, contributed to the general climate of uncertainty.
