Wild capitalism, privatisation and employment relations in Serbia

Purpose – This paper aims to examine the phenomenom of wild capitalism under post Communist transformation. Many commentators on post Communist transformation focus their attention on dysfunctional corporate governance and the deleterious consequences of liberalisation on business ethics. Poor business ethics and bad corporate governance may be a consequence of labour exploitation for comparative advantage, and the abandonment of party authority. This allowed rapacious rent‐seeking by a minority well placed to benefit from the newly de‐regulated regime. A by‐product is a burgeoning informal economy encouraged by insider dealing of privatised state assets. State regulation, where it exists, is often ignored. Employment relations are fragmented, with state‐owned enterprises retaining some form of collective regulation, while newly privatised enterprises seek to marginalise union activity. Design/methodology/approach – The paper analyses why Serbia has diverged from the Slovenian case in the former Yugoslavia and determines norms of behaviour as a product of both structural and agency dynamics. Evaluates the Privatisation Agency's programme and reviews documentary evidence on business transparency. Records evidence of labour disputes from trade unions, press reports, semi‐structured interviews with trade union leaders and activists. The researchers also held a Round Table of trade unionists, journalists and employers in Belgrade in September 2008, funded by the British Academy. Findings – The paper concludes that wild capitalism is an integral, rather than deviant mode of behaviour in Serbia. Originality/value – The findings have relevance for other post Communist states, which may be subject to a greater or lesser degree to political clientelism and fragmentation of employment relations.