From Russia with luck

A tale of corruption and corridors. The Mint hears how Alena Ledeneva looks for favours.

During the final days of the Soviet Union in 1990, a young sociology student in the Siberian city and academic powerhouse of Novosibirsk was taken aside in a corridor of the institute she attended. She was asked to meet “some British professor who stopped by and wanted to see what young people were like.” So Alena Ledeneva met Professor Teodor Shanin OBE and he helped her to come to Britain, all expenses paid, to attend a summer school in Kent.

This was the opening of a story of extraordinary happenstance.

Shanin was a British national, who grew up in Siberia after he and his parents, were exiled there by Stalin’s antisemitic regime. He was also a “person on the ground” for one of the Open Society Foundations set up to fund human rights groups by Hungarian-born billionaire George Soros. So through Shanin, Ledeneva applied for a foundation scholarship, won it and came to south-east England.

She did well in Kent and in 1992 picked up a post-graduate research post at Cambridge University, in significant part, because she was Russian: “Pure chance,” she says. Furthermore, there was, she says, “an idea that maybe Soviet sociologists were an interesting bunch of people and worth investing in.

“When I came to Cambridge, I was asked, ‘What’s your competitive advantage?’ So I said, I’m an insider of the Soviet system and I know how it works, and I’m curious to see what’s going to happen now it has collapsed, and how the system is going to transform itself in response to the democratic and market reforms. I got a PhD scholarship to study just that.”

Her PhD research included scrutiny of the culture of favours that characterised the Soviet Russian economy and its post-Soviet reverberations. So the tale of Ledeneva’s career inevitably steers us to the Russian informal exchange of favours known locally as blat…  and toilet paper.

She describes blat under Soviet rule, as a mutual arrangement among equals that helped them to get by under an authoritarian regime. Ledeneva explains how in the Soviet Union, blat grew out of: the planned economy with no market; a centralised distribution system for everything where communist party members would get special privileges through informal channels; and an economy of shortages “which means that you couldn’t really get things purchased freely and you had to rely on friends and family to be able to get hold of basics.

“Anecdotally the Soviet Union was known for the shortages of the toilet paper, as seen in the UK during the pandemic.” This, it seems, is a pattern in an economy of shortage.

The characteristics of blat in post-Soviet Russia are, according to Ledeneva, less clear than before the regime’s fall. “It’s very hard to speak about it in universal terms, without context and specifics. And that’s exactly what makes the phenomenon of informality so difficult to capture,” she says.

Blat, she says, depending on context, is routinely portrayed either as helpful exchange or as a means of using informal networks to get competitive advantage. “When you ask people, ‘do you use blat?’ People would say, ‘No, of course not, it’s friendship.’ But when you ask them about other people doing precisely the same, they say it is blat and self-serving.”

“With blat exchanges, the interesting thing is that the relationship, and the use of the relationship does not have a borderline. In a long-term relationship, favours go to and fro within the relationship. If you become transactional, it is not looked upon kindly because you’re looking to get what you can out of the relationship. And that means you are not a reliable member of an informal network.”

We studied open secrets and unwritten rules.

She draws an ironic parallel with English dinner party etiquette that says it is insulting for a guest to bring a bottle of wine. “Here we are in the territory of unwritten rules. Unwritten rules often differ between networks. Sometimes you do bring a bottle and sometimes you don’t. You have to be context sensitive.  

“In our global informality project, we studied open secrets and unwritten rules. We discovered that there are powerful, informal codes that keep communities together. But, the sense of belonging that is very inclusive for some, is exclusive of others.”

Arguably blat and other informal systems are seen instinctively as pivotal elements in corrupt practices. “It was,” says  Ledeneva, “very much the perception, that we should sort out formal institutions and make them good, so there is no necessity for informality, which is bad. But my research around the globe shows, that actually the situation is much more complex.”

While the demise of the Soviet system brought markets and democracy, Ledeneva says informal networks have, proliferated in post-Soviet Russia. “In the post-Soviet environment, the role of informal networks has been much more instrumental in building up wealth and businesses and for creating the state capitalist system in Russia,” she says.

Networks, especially Vladimir Putin’s friends, are very interesting to analyse.

“The global informality project has found that even the best markets and most mature democracies have informal practices gluing society together.” And she says, post-Soviet politics has overlooked the extent to which informal networks not only operate at the grassroots level, and help build businesses and institutions, but also operate at the top, to create effective informal governance. “That’s where networks, especially Vladimir Putin’s friends, are very interesting to analyse,” says Ledeneva.

“A lot of things get done in Russia through mutual obligation. To be a friend of Putin means to build a village for the Olympic games, in time, and with quality, or to be able to step in where it’s most difficult for the regime.”

There is no simple solution for tackling corruption in any regime.

It would be safe to argue that Putin’s friends, who fulfil their part of any obligation, are likely to pick up rewards. Ledeneva agrees, but warns of over simplifying the arrangement, “Of course you are rewarded. But we’re studying things that are hard to measure, difficult to research, and not always polite to ask.

“And I think it’s too easy to brand it as corruption.”

She goes on to warn, “There is no simple solution for tackling corruption in any regime, which is why, after 25 years of advanced anti-corruption reforms and funding, corruption is rampant and becoming worse.”

Ultimately she sees the formal is good; informal is bad, mantra as failing to address global corruption. “We are getting it wrong at the level of the grand narrative and major ideologies,” she says.

“To fight corruption, you really need to know and understand more about informality. You need to address social norms. You need to engage in sophisticated next-generation policy, which is context-bound, and context-sensitive, rather than produce a uniform range of reforms and legislations that have to be pushed through the parliaments in countries which actually want to achieve a change.”

Alena Ledeneva

Alena is Professor of Politics and Society at the University College London and a founder of the Global Informality Project (in-formality.com) and The Global Encyclopedia of Informality (2018). She graduated …

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