ABSTRACT
Relative to the transition in Central Europe, Russia’s has been more turbulent, more uncertain, and more painful. Output has fallen by half from 1990 levels. By mid-decade, barter and other nonmonetary instruments had grown to dominate transactions between FSOEs. Rekindling economic growth in the first six years after price liberalization proved exceptionally difficult. Each year brought new hope of a long-anticipated turnaround in industrial output, yet the financial collapse in August 1998 witnessed a large decline in industrial production. In 1999, the promise of an expansion in industrial output finally materialized, yet uncertainty pervaded Russia’s political and economic situation. Workers’ average monthly wages remained low, late, and often unpaid. Tax avoidance was rampant and, consequently, government revenues were well below levels capable of sustaining a civil society.
