Robert Skidelsky
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Articles from Vedomosti (Ведомости)

The American business model part 3: the role of lawyers
Robert Skidelsky
Vedomosti | Thursday, April 29, 2004

 
Every society should be subject to the rule of law. This is not the same as rule by lawyers. In its worship of law, the United States is both an example and a warning.
 
In Russia, the rule of law has come to mean protection of property rights. This is understandable, since private property was illegal in the Soviet Union. The most urgent requirement of a private business system is secure title to property. Without it, businesses cannot borrow, because they can offer no security for loans; investors will not buy businesses unless they are sure that they will own them. For the Peruvian economist Herman De Soto, title to property is the key to economic growth.
 
Property rights have to be secure both against the state and against other

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The American business model part 2: Transparency
Robert Skidelsky
Vedomosti | Thursday, April 15, 2004

 
Once upon a time, business depended on trust. You trusted your partner or supplier not to cheat you. Why? Because you knew each other. Deals were verbal understandings: a man’s word was his bond. It was care for his reputation that kept the businessman honest: if he was known to cheat, he was finished. It was allowed to cheat a stranger, but not one of your own. Much of the world’s business is still done on this basis: in the mosque, the souk, or the banya.
 
Transnational businesses were built up from family or racial connections. An 18th century writer wrote of the Jews: ‘They are become the instruments by which the most distant Nations converse with each other and by which mankind is knit together....’ Dispersed family and ethnic

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The American business model part 1: Corporate Governance
Robert Skidelsky
Vedomosti | Thursday, April 01, 2004

 
Russian business has emerged from its semi-criminal, post-Communist origins: already films like Oligarch and Brigada look like elegies for a vanished past. Robber barons, grown rich on stolen state assets, talk the language of corporate responsibility; their children study ethics at American business schools.
 
America is the model, because it is the most successful economy in the world. But the post-Enron ‘American model’ is itself in crisis. The economist Joseph Stiglitz describes it in terms which would almost fit Russia: –‘corporate greed, accounting scandals, public influence mongering, banking scandals, deregulation, and the free market mantra, all wrapped together’. Over my next four columns I will discuss four distinctive aspects

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Russia should use PFIs to rebuild its public services
Robert Skidelsky
Vedomosti | Thursday, March 18, 2004

 
Put together a government with too little money and a private sector with too much money and you have the making of Public/ Private Partnership. In Russia today, government revenue comes to 19.3% of official GDP, or $85bn. If the black economy (estimated at about 40 per cent) is added on, government revenue comes to only 14% of GDP - between a third and a quarter of public revenue as a percentage of GDP in the European Union. With this sum, the Russian government has to build and maintain almost the whole of Russia’s public infrastructure. No wonder it is crumbling away.
 
On the other side, there are 23 ‘official’ billionaires in Moscow alone and hundreds, if not thousands, of millionaires, in Russia as a whole. So why not get them to

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The death of the dollar?
Robert Skidelsky
Vedomosti | Thursday, March 04, 2004

 
Every time the dollar slides in the international currency markets, people predict the death of the mighty dollar. No one, they say, will want to go on investing in a depreciating currency. The age of the dollar has come to an end. Its successor will be a multi-polar currency system, with the dollar, the euro, and possibly the yen as the three competitive poles of attraction. How likely is this?
 
Take a look at the chart below. Since 1970, the US $ has appreciated by X per cent against a trade-weighted basket of currencies. In this light, its recent fall by 15% is little more than a ‘blip’, which reverses its appreciation since 2000. What the chart shows is that short-term fluctuations in exchange-rates are useless as predictors of

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