Reducing structural dominance and entry barriers in Russian industry

Many industrial firms in Russia have undergone changes in ownership, but relatively few have been competitively restructured. Using survey and other data, the author suggests that much of Russian industry is immune from robust competition because of heavy vertical integration, geographic segmentation, and the concentration of buyers and sellers, in selected markets. Moreover, regulatory constraints protect incumbent firms from competition with new entrants, both domestic and foreign. The author sketches a reform agenda for Russia's post-privatization program, which emphasizes the restructuring of anti-competitive structures and the reduction of barriers to entry. The author's proposed reform agenda calls broadly for strengthening Russia's nascent rules-based framework for competition policy to reduce discretion, increase transparency, and improve accountability.