Compensation, Incentives and Risk: Economic Theory and Russian Practise

Mr. Pechersky set out to examine a specific feature of the employer-employee relationship in Russian business organisations. He wanted to study to what extent the so-called "moral hazard" is being solved (if it is being solved at all), whether there is a relationship between pay and performance, and whether there is a correlation between economic theory and Russian reality. Finally, he set out to construct a model of the Russian economy that better reflects the way it actually functions than do certain other well-known models (for example models of incentive compensation, the Shapiro-Stiglitz model etc.). His report was presented to the RSS in the form of a series of manuscripts in English and Russian, and on disc, with many tables and graphs. He begins by pointing out the different examples of randomness that exist in the relationship between employee and employer. Firstly, results are frequently affected by circumstances outside the employee's control that have nothing to do with how intelligently, honestly, and diligently the employee has worked. When rewards are based on results, uncontrollable randomness in the employee's output induces randomness in their incomes. A second source of randomness involves the outside events that are beyond the control of the employee that may affect his or her ability to perform as contracted. A third source of randomness arises when the performance itself (rather than the result) is measured, and the performance evaluation procedures include random or subjective elements. Mr. Pechersky's study shows that in Russia the third source of randomness plays an important role. Moreover, he points out that employer-employee relationships in Russia are sometimes opposite to those in the West. Drawing on game theory, he characterises the Western system as follows. The two players are the principal and the agent, who are usually representative individuals. The principal hires an agent to perform a task, and the agent acquires an information advantage concerning his actions or the outside world at some point in the game, i.e. it is assumed that the employee is better informed. In Russia, on the other hand, incentive contracts are typically negotiated in situations in which the employer has the information advantage concerning outcome. Mr. Pechersky schematises it thus. Compensation (the wage) is W and consists of a base amount, plus a portion that varies with the outcome, x. So W = a + bx, where b is used to measure the intensity of the incentives provided to the employee. This means that one contract will be said to provide stronger incentives than another if it specifies a higher value for b. This is the incentive contract as it operates in the West. The key feature distinguishing the Russian example is that x is observed by the employer but is not observed by the employee. So the employer promises to pay in accordance with an incentive scheme, but since the outcome is not observable by the employee the contract cannot be enforced, and the question arises: is there any incentive for the employer to fulfil his or her promises? Mr. Pechersky considers two simple models of employer-employee relationships displaying the above type of information symmetry. In a static framework the obtained result is somewhat surprising: at the Nash equilibrium the employer pays nothing, even though his objective function contains a quadratic term reflecting negative consequences for the employer if the actual level of compensation deviates from the expectations of the employee. This can lead, for example, to labour turnover, or the expenses resulting from a bad reputation. In a dynamic framework, the conclusion can be formulated as follows: the higher the discount factor, the higher the incentive for the employer to be honest in his/her relationships with the employee. If the discount factor is taken to be a parameter reflecting the degree of (un)certainty (the higher the degree of uncertainty is, the lower is the discount factor), we can conclude that the answer to the formulated question depends on the stability of the political, social and economic situation in a country. Mr. Pechersky believes that the strength of a market system with private property lies not just in its providing the information needed to compute an efficient allocation of resources in an efficient manner. At least equally important is the manner in which it accepts individually self-interested behaviour, but then channels this behaviour in desired directions. People do not have to be cajoled, artificially induced, or forced to do their parts in a well-functioning market system. Instead, they are simply left to pursue their own objectives as they see fit. Under the right circumstances, people are led by Adam Smith's "invisible hand" of impersonal market forces to take the actions needed to achieve an efficient, co-ordinated pattern of choices. The problem is that, as Mr. Pechersky sees it, there is no reason to believe that the circumstances in Russia are right, and the invisible hand is doing its work properly. Political instability, social tension and other circumstances prevent it from doing so. Mr. Pechersky believes that the discount factor plays a crucial role in employer-employee relationships. Such relationships can be considered satisfactory from a normative point of view, only in those cases where the discount factor is sufficiently large. Unfortunately, in modern Russia the evidence points to the typical discount factor being relatively small. This fact can be explained as a manifestation of aversion to risk of economic agents. Mr. Pechersky hopes that when political stabilisation occurs, the discount factors of economic agents will increase, and the agent's behaviour will be explicable in terms of more traditional models.

The Monumental Barrows of the Period 700-1100 AD at the Russian North-West

Nicholas Petrov. The Monumental Barrows of the Period 700-11 AD in the Russian North-West The research deals with the monumental barrows erected in the Russian north-west in the period of 700-1100 AD, which Russian archaeological literature has traditionally named sopka-barrows. These sopka-barrows were analysed as original sacral and funeral structures and considered in the context of cultural processes under way in that region at the time. The position occupied by the sopka-barrows in the culture of the people who erected them was reconstructed on the basis of a synthesis of various kinds of sources - archaeological, written, folklore. The high barrows are not in fact a determining type of the sites of the so-called "culture of the sopka-barrows" in modern literature, which focuses rather on settlements near to which sopka-barrows are absent. Recent excavations have revealed the presence of "surface" burial places (cremation located on the top of the barrow repeatedly rather than only once) in the majority of the sopka-barrows. The materials only provide evidence about the sacrificial nature of the graves in the "body" of the sopka-barrows. They thus offer an embodiment of one element of the widespread views about the dead man's path to the world of the dead (mountain) which is traced in folklore texts. Special attention was paid to the question of the disappearance of the tradition of erecting sopka-barrows and to the nature of their role in the culture of the region during the period 1000-1200 AD. The functioning of the sopka-barrows as funeral monuments in the second millennium AD is also traced on the inlet inhumatios found in them.

Marginal Man in Modern Russian Literature

This research was focused around the intersection of two discourses: that of marginality and that of ideology. Ponomarev analysed works by Alexander Zinoviev, Vladimir Maximov and Eduard Limonov - three writers representing different groups of Soviet dissidence - from the viewpoint of the concept, drawn from anthropological theory, of marginal man. Using a methodology he describes as ideological analysis, Ponomarev showed that the ideologies of both the writers and their characters are marginal, lying as they do between official Soviet and western democratic ideologies. He showed that the works and the 'creative behaviour' of the three writers did not change after 1991, when their ideas seemed victorious. Marginality is shown to be a permanent characteristic and is linked with the main ideas of the dissident movement in the USSR. On the basis of this marginality, Ponomarev identified some common traits in dissident ideas and drew up a model of dissident ideology. This general model of dissident ideology seems to be one of the special Russian variants of the marginal ideologies of intelligentsia and could be compared to the ideology of Rodon Raskolnikov, the central character in Dostoevsky's Crime and Punishment. The discourse of ideology in the USSR in the 1970s-1980s and in 1990s Russia thus appeared as a process in which the elements of the official Soviet ideology were gradually superseded by those of the dissident ideology linked with the ideology of the underground, the Russian version of the post-modern. Marginal ideologies won and became mainstream but did not lose their basic marginal traits. Ponomarev concludes that the gap between the 'state ideology' and the dissident ideology, taken together with the special Russian version of postmodernity has shaped the current literary process in Russia, making the figure of the marginal man into the main writer type.

Russian Writers and the Third Section

The Third Section was an instrument not so much of oppression as of information, propaganda and education. Under Nicholas I, the press did not represent public opinion, but rather the official point of view. It was intended to shape public opinion rather than to express it and much of the Third Section's activity focused on creating the best possible contacts with journalists and men of letters. The Third Section supervised literary activities by examining works in print and collecting information through its agents. It rewarded those authors whose work was approved by the emperor, it used writers to pursue its goals, especially in order to "direct minds", but acted as a mediator between the tsar, censors and writers, or sometimes as arbiter in conflicts between writers themselves, and it also acted as a censor. Writers, for their part, served in the Third Section, becoming its agents or consultants, delivering reports to it and writing texts commissioned by the Section. The majority of writers did not see any problems with serving or assisting the Third Section. Ideologies offering an alternative to state monarchism /in professional literature or individual liberalism/ were very weak. The only exception was a small group, mostly composed of eminent and highly educated aristocrats who possessed alternative moral and financial resources. Reitblat showed that the strong ties maintained by some journalists and writers with the Third Section were not unfortunate exceptions due to the low moral qualities of those individuals, but rather a natural phenomenon which reflected the specific nature of the Russian literary system and, more generally, of Russian society as a whole.

Rhetorics and Practices of Modernisation in Russian Industry: a Reflective Analysis of Organisational Cultures in Transition

This research was based on the results of a case study of a large confectionery factory in the Russian city of Samara. The concept of paternalism is clear in many features of the life of Russian enterprises, including the rhetoric and strategy of the management, relationships within the labour force and the stereotypical expectations of workers. The concept also has a much wider bearing, embracing the spheres of state policy, the social, and family relationships, that is every sphere of social life in which the patriarchal, communal, stereotyped way of thinking of the Soviet people is reproduced. A substantial proportion of the state's role in providing social protection for the population is carried out through enterprises. In spite of low salaries and the absence of career opportunities, female workers were as strongly attached to the enterprise as to their homes. Romanov's research showed how the development of capitalism in industries in Russia is destroying the cultural and social identities of female workers and is contributing to gender inequality. Interpersonal relations are becoming increasingly utilitarian and distant and the basic features of the patriarchal type of administrative control are becoming blurred. This control is becoming more subtle, but gender segregation is preserved in the new framework and indeed becoming more obvious, being reproduced both at the departmental level and in the hiring policy of the enterprise as a whole.

Colour Symbolism, Colour Preference in Hungarian Folklore and Folk Architecture"

The Hungarian way of decoration has certain characteristics which are rooted in the deep symbolism of ancient Hungarian mythical thinking. The ancient heritage of the Hungarians' former homeland somewhere in the Urals included eastern elements. During their migrations, the Hungarian tribes met other eastern peoples and their culture of decoration became mixed with elements drawn from these new contacts. These diverse influences mean that the Hungarian way of thinking, building and ornamentation show a certain dualism of Puritanism and rationalism in the creation of space and manufacturing, and rich fantasy in decoration and ornamentation. The Hungarians use coloured ornamentation to emphasise the symbolic importance of details. The colouring system of the built environment shows the same dualism: the main colour of the facades and inner walls is white, while the furniture, textiles, gates and windows, and sometimes the gable and fireplace are richly decorated. In Hungarian symbolism, the house and settlement are a model of the universe, so their different parts also have a transcendent meaning. The traditional meanings of the different colours reflect this transcendence. Each colour has ambivalent meanings: RED - the colour of blood - means violence and love. YELLOW - means sickness, death and ripeness (golden yellow). BLUE - means innocence, eternity (light blue) and old age, death (dark blue). BLACK - can be both ceremonial and mourning. WHILE - can have sacred meaning (bright white), while yellowish white fabric is the most common garb of both men and women in village society. GREEN - the only colour without a dual meaning, symbolises the beginning of life. Until the late 18th and early 19th centuries Hungarian folk art used one or two-coloured decoration (red, black, blue, red-blue or red-black), and from the early 19th century it moved to multi-coloured decoration. Colours are characteristically used in complementary contrast, with bright colours on a plain ground and an avoidance of subtle shadings.

Challenging Folk Icons - Rewriting Woody and Santeri

Woody Guthrie’s song, “The 1913 Massacre,” written around 1940-41, has become something of a folk anthem for progressives, leftists, and labor supporters. It depicts the Italian Hall Disaster of December 24, 1913, in a plainspoken and colorful way, but has been (rightfully) described as “deeply flawed historically.” Much like Guthrie’s English-language folk songs, Finnish immigrant Santeri Mäkelä had a major impact on capturing the working-world around him. Mäkelä’s lyrics for the “Kaivantomiehen Laulu (The Miners’ Song)” were first published in Hancock, 1909, in “Uusi Työväen Laulukirja (The New Workers’ Songbook),” and was probably sung widely by Finnish strikers during the 1913-14 Michigan Copper Strike. Leading up to, and during this Strike Centennial year, there have been renewed performances of the song, both in Finland and the United States—but only in the original Finnish language. This presentation will delve into the accuracy, history, and lyrics of these two important, but historically problematic labor songs.

Exhibit: "Michigan-I-O": Alan Lomax and the 1938 Library of Congress Folk-Song Expedition"

In 1938, a young folk music collector named Alan Lomax—destined to become one of the legendary folklorists of the 20th century recorded Michigan’s richly varied folk music traditions for the Archive of American Folk-Song at the Library of Congress. Michigan in the 1930s was experiencing a golden age of folksong collecting, as local folklorists mined the trove of ballads remembered by aging lumbermen and Great Lakes schoonermen. In addition to the ballads of these north woods singers, Lomax recorded a vibrant mix of ethnic music from Detroit to the western Upper Peninsula. The multimedia performance event Folksongs from Michigan-i-o combines live performance with historic images, color movie footage, and recorded sound from the Great Depression. Some of these materials haven’t been heard or seen by the general public for more than seven decades. The traveling exhibition Michigan Folksong Legacy: Grand Discoveries from the Great Depression brings Alan Lomax’s 1938 field trip to life through words, song lyrics, photographs, and sound recordings. Ten interpretive banners explore themes and each panel contains a QR code that links to related sound recordings from the Alan Lomax Collection at the American Folklife Center, Library of Congress.

Exhibit: "Michigan-I-O": Alan Lomax and the 1938 Library of Congress Folk-Song Expedition"

In 1938, a young folk music collector named Alan Lomax—destined to become one of the legendary folklorists of the 20th century recorded Michigan’s richly varied folk music traditions for the Archive of American Folk-Song at the Library of Congress. Michigan in the 1930s was experiencing a golden age of folksong collecting, as local folklorists mined the trove of ballads remembered by aging lumbermen and Great Lakes schoonermen. In addition to the ballads of these north woods singers, Lomax recorded a vibrant mix of ethnic music from Detroit to the western Upper Peninsula. The multimedia performance event Folksongs from Michigan-i-o combines live performance with historic images, color movie footage, and recorded sound from the Great Depression. Some of these materials haven’t been heard or seen by the general public for more than seven decades. The traveling exhibition Michigan Folksong Legacy: Grand Discoveries from the Great Depression brings Alan Lomax’s 1938 field trip to life through words, song lyrics, photographs, and sound recordings. Ten interpretive banners explore themes and each panel contains a QR code that links to related sound recordings from the Alan Lomax Collection at the American Folklife Center, Library of Congress.