The Russian entrepreneur

Abstract

Despite a significant interest in business and entrepreneurial activities in the former USSR, there continues to be a shortage of accurate information to dispel some of the myths and misinformation particularly about entrepreneurial activities occurring in the new Russia. Since the inner workings of the economic environment in the former USSR have rarely been described or understood, it is important to view present day entrepreneurs in the context of the country's historical perspective and entrepreneurial predecessors. While never in the forefront of the largely political stage of the country during the Tsarist and Soviet periods, entrepreneurs have nonetheless been consistently present throughout the country's history. Even though most everyone was engaged to some extent in some form of commercial activity, entrepreneurs from the 16th to the 19th century were thought to be inferior individuals. As a consequence, entrepreneurs were oppressed, heavily taxed, powerless individuals at the bottom level of society. But for a few notable exceptions, even Peter the Great's program to create a class of industrialists failed to develop entrepreneurs. In spite of this significant hindrance, entrepreneurship developed and flourished during the Tsarist period, mainly due to the geographical, economic and social, psychological, and political factors. Socialism, the State's domination of the economy, and the centrally planned economy impacted the type and extent of entrepreneurship during the Soviet period. Soviet entrepreneurs, though existing in the shadow economy, were hampered by several factors: only being exposed to mostly secondhand, printed information, not having a lawful mechanism to transfer the risk of entrepreneurship from the State to the individual, not being in sync with the ultimate purpose of the country's economic activity to further the interests of the State, and dealing with an economic situation where production units were separated from research and development units. Three entrepreneurial scenarios of a high-tech company, a Russian brokerage company, and an educational organization, are presented that exemplify the entrepreneurial talent and ability present in the country. To the extent that these scenarios are repeated in a variety of industries by many different entrepreneurs, the successful movement to a progressive market-oriented economy will be speeded. © 1993.