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Center for Social Economic
Research
The Political Economy
of Privatization
in Ukraine
by
David Snelbecker
Warsaw, December 1995
Materials published in these series have a working papers character.
They can be subject to further publication. The views and opinions
expressed here reflect Authors point of view and not necessary those
of CASE .
Paper was prepared for the project: Economic Reforms in the
former USSR (Reformy gospodarcze na terenie dawnego ZSRR),
financed by the Comittee of Scientific Research (Komitet Badań
Naukowych).
© CASE Research Foundation, Warsaw 1995
ISBN 83-86296-57-7
CASE - Center for Social Economic Research
00-585 Warszawa, Bagatela 14
tel/fax (48-2) 628 65 81; tel/fax (48-22) 29 43 83
The Political Economy of Privatization...
Abstract
Along with macroeconomic stabilization and liberalization of commercial activity,
privatization is a central pillar of transition from post-socialism to a market economy.
Privatization transfers inefficient state-owned enterprises to private owners, promoting
hard budget constraints and economic incentives for managers in place of political
incentives. Although privatization is only one step in the process of enterprise
restructuring, it is a key element and certainly the one which has received the most
attention.
Privatization in Ukraine started slowly. Serious discussion among Ukrainian
policymakers about privatization began around 1990, and by 1992 Ukraine adopted it
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