Upgrading Russian Enterproses from the value chain perpective: The Case Study of Tube & Pipe, and Furniture Sectors

The paper is the first analysis of the competitiveness of Russian enterprises from the perspective of value chains, with a focus on the example of tube & pipe and furniture producers. In both industries, Russian firms enjoy an advantage on raw material side. Nevertheless, the overall competitiveness level of Russian producers remains modest. Domestic industries primarily owe decreased competitiveness to the inadequate operation of the final links in the value chain: from end-product production to end-product user. In addition, the competitiveness of domestic producers is limited to the ability of key players in the chain to redistribute additional gains in their own favour. Study shows that any non-selective of supporting enterprises (such as tax reductions) exert extremely limited influence on the status of players in those chains where one of the links is characterized by the serious entry barriers and related opportunities of rent redistribution in favour of a particular player. Paper suggests several policy measures which aim to improve the ability of the producers to reposition themselves along the chain and modify the chain itself