An excellent, simply excellent article on Slon.ru Why Stalin Succeeded and Why We Won’t ...in Russia, the economy is heavily monopolized, and the sphere of competition keeps shrinking. As a result, the companies that remain in the market earn profits that are often very high by Western standards (although in some companies, potentially high profits are offset by low efficiency). The economy contains a very large share of so-called rent income—that is, income companies extract from their monopoly position. And that monopoly position is achieved primarily through corruption, when officials with the power to regulate the economy artificially restrict competition and receive bribes in one form or another in return. The likelihood of successfully earning excess profits in such a system is far greater than the likelihood of creating a successful innovation. Companies, like people, follow the path of least resistance. In other words, if they can achieve a goal the easy way, no one will pursue that same goal the hard way. If there is an opportunity to make high profits through corruption and the capture of a monopoly position, companies will take it rather than risk introducing innovations. Amen.
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