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Russian Oligarchy

Oligarchy is borrowed from a business term business oligarch describing the acquiring of the numerous and vast sum of money. It also represents few individuals who rule or govern the economy. In Russian business, oligarch arose during the privatisation of Russian after the dissolution of the Soviet Union. To be an oligarch in Russian, you necessary need not have political power but have great wealth. People came from nothing and became billionaires through connections with government officials and dirty and corrupt business deals. Business entrepreneurs smuggled goods into Russian and sold them in black markets whereby they made huge profits making them billionaires.

Most of the Russian oligarchs arose during the time of transition to market-based economy and privatisation process. Most of the Russian oligarchs are relatives to political leaders, leaders of criminal gangs and even politicians themselves. The process of private ownership created a loophole in which criminal activities and corruption were significantly fostered. Oligarchy has evolved through different presidential regimes in Russia. Some regimes show great political influence by the oligarchs. Once they took control of political figures in the country, they had the chance to immerse more wealth thus becoming politically active throughout the regime. In some instances, the Russian oligarchs are highly disliked by the general public due to the economic disparities they cause in the Russian nation.

The economic effects of Russian oligarchy

When analysing or talking about the economy of Russia or any country that was part of Soviet Union, it is practically impossible to withhold the effects the oligarchs have on the economy. Their effects are felt by the companies and businesses they run in the economy. Their personality in the economy is guided by their huge check books and their impacts on the economy are believed to be mostly negative. Being an oligarchy does not mean that you have a lot of wealth but also encompasses possession of the power to use the wealth and resources to exact a certain degree of power and control especially political influence and control.

Although the oligarchs strive to see their companies succeed and build up more financial assets in the economy, there may be a rise in uncompetitive environment in the economy if the company owns and leaders form close relationship with government officials.

Factors that favoured Russian oligarchy

The dissolution of Soviet Union and the transition of the Russian economy to market-based significantly fostered the rise of an oligarchy in Russian and other countries that were affiliated to the Soviet Union. The privatisation process also led to the growth of oligarchy in Russia. In addition, some presidential regimes resulted in the growth and development of Russian oligarchy.


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