COMPANY PERFORMANCE IN UKRAINE: IS THIS A MARKET ECONOMY? Adi Schnytzer Bar-Ilan University Tatiana Andreyeva * RAND Graduate School of Policy Analysis ABSTRACT This paper examines empirically the responsiveness of firm performance to ownership and market structures, sector and regional specificity, and varying degrees of soft budget constraints. It does so by providing a “snapshot” of the economy. For cross-sectional data on Ukrainian firms in 1998, the paper presents evidence that the firms in the snapshot behaved more as if they were still in a loosely reformed Soviet environment, where exchange via interpersonal connections, rather than the price mechanism, determined the allocation of resources. JEL Classification: D21, D24, D40, L33, P23, P31 Keywords: firm performance, privatization, competition, soft budget constraint, transition * Corresponding Author Published as: “Company Performance in Ukraine: Is this a Market Economy” (with T. Andreyevna), Economic Systems 26(2), 2002, 83-98. * This author gratefully acknowledges support from the Economics Education and Research Consortium of the Eurasia Foundation and the World Bank (Grant N R00-4521).