Lien-loan Auctions and Origins of Russian Oligarchy Cover Image
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Заложно-кредитне аукције и настанак руских олигарха
Lien-loan Auctions and Origins of Russian Oligarchy

Author(s): Rajko Bukvić
Subject(s): Economy
Published by: Nova srpska politička misao
Keywords: Russia; lien-loan auctions; privatization; oligarchs; political support; common property of the people

Summary/Abstract: The process of privatization that marked the so-called transition of East European economies in the 1990s and first decade of 21st century have left a lot of theoretical and empirical materials which will remain research topics for quite a while. This process is particularly interesting and significant in Russia, the biggest and richest country of the former Socialist Bloc, where massive voucher privatization was followed by various machinations organized by the ruling clique gathered around the former president Yeltsin, his family and friends. This paper analyzes one of the mechanisms that enabled process – lien- loan auctions, held in 1995 and in which twelve giants of Russian (and world economy) were privatized virtually at no cost, thus forming a class oligarchs. According to the confession of one of the creators and protagonists of the entire process, it was a means to pay for political support to carry out a “normal” revolution. However, there is a question which this protagonist did not answer – whose support is so important and expensive: the support of domestic tycoons (like the banker Potanin and those like him, who initiated this mechanism that made them enormously rich) or someone else’s support?

  • Issue Year: 17/2009
  • Issue No: 03+04
  • Page Range: 131-156
  • Page Count: 26
  • Language: Serbian