Because of the Soviet Union's heavy emphasis on military prowess and capability, the military-industrial sector in the Soviet Union (and Russia) was larger than its counterparts in other industrialized societies. In addition to military equipment, it produced almost all civilian products with technology content such as appliances, electronic equipment, and aircraft.

With the ending of the Cold War, support for the military production from this sector was radically deemphasized. The necessary adjustment of the military enterprises to this demand shock has been embedded in far more comprehensive economic reforms. As the country has moved to a market economy and privatized much of its economic potential, the managers of the enterprises have found it necessary to convert most of their output to nonmilitary products and services as well as to restructure the enterprises.

The three major areas of restructuring are (1) the relationships of the enterprises with their owners, (2) the internal organization and operational procedures of the enterprises, and (3) the relations between the enterprises and the employees. The degree of success of the national economic reform program and the health of the economy will depend substantially on the degree of success of the defense enterprises in utilizing their residual assets (human, technological, and physical) to generate profitable economic activity.

This report deals with this economic transition, primarily at the enterprise level. We have met the directors of more than forty defense enterprises and worked with approximately ten of them in considerable detail and six in more detail, having spent between one quarter and one person year with managers from each of the six. The report contains case studies of these six enterprises as well as cross-cutting chapters on four critical aspects of enterprise restructuring--privatization, organization, accounting, and social services. These have emerged as the key factors governing the strategies of the enterprises, and they will be some of the primary determinants of the success or failure of an enterprise.

The Soviet Union's economy was overindustrialized and highly militarized, with a disproportionate share of the military industry located in the Russian Republic. It is therefore not surprising that industrial production, including military production, has dropped sharply in the economic environment of the last few years. Many enterprises are shrinking, but few are failing completely or going into bankruptcy, and there is little disaggregation of large enterprises into smaller legal entities. Thus, with the exception of privatization, the general profile of Russian industry has not changed greatly.

The creation of new entrants (new business entities), to the extent that it is occurring, is one of the more promising aspects of the economic transition. However, the managers of many of the large enterprises resist divesting themselves of segments of their business. They fear that subsequent capitalization will result in a major reduction of value of the parent because the parent's contribution to the capitalized spin-off will not command much equity. Directors recognize the need for decentralization of management and financial responsibility, but many of them prefer to create divisions rather than subsidiaries. They also try to bring outside investment into the entire large enterprise rather than into a subsidiary. It is difficult for small groups of employees to simply leave and form a new (start-up) corporation because of the lack of commercial and social services infrastructure, especially capital markets, and the lack of rights to use state facilities.

This paper describes the technologies needed for producing nuclear weapons, giving particular attention to those used in electromagnetic separation and laser uranium-235 enrichment.  The complexity of the technologies makes it clear that developing countries, to various degrees, need assistance from the developed world in order to build nuclear weapons.  Complete restriction of assistance could prevent the spread of these weapons.  Unfortunately, knowledge of the technology is already so widespread that preventing further spread is virtually impossible in the long run.  In practice, imposing rigorous control over the availability of key components of all of the possible technologies may delay access to nuclear weapons by the less-developed world for many years.  All of the recommendations in this discussion may be overtaken by the chaotic situation in the former Soviet Union--rumors abound that its nuclear engineers, technology, weapons material, and the weapons themselves are potentially for sale.  A better method of preventing proliferation is needed, and some of the proposals for achieving improvements are discussed in this paper.

When a state develops a nuclear arsenal, these destructive weapons must be initially integrated into existing military forces and initially managed through existing civil and military institutions. The subsequent relationship between nuclear weapons and civil-military relations in possessor states is complex, however, and presents an important two-way puzzle. First, it is important to ask how existing patterns of civil-military relations in nuclear states have influenced the likelihood of nuclear-weapons use. Some scholars believe that military officers are less war-prone and hawkish than civilian leaders; others believe the opposite, that the military tends to be bellicose and biased in favor of aggressive military postures. Which view is right, especially when nuclear weapons are involved, is a question that has not been fully addressed in the literature. Second, it is important to flip the question around and also ask how nuclear weapons have influenced civil-military relations in the states that have acquired the ultimate weapon. Again, the answer is not clear. One might expect that the massive destructive power of these weapons would encourage much greater civilian involvement in military affairs. Yet, at the same time, one might predict that military organizations would maintain significant control over nuclear policy as they want to protect their operational autonomy, and because the perceived need for a prompt response would mitigate against tight civilian control.

The papers in this volume are revised versions of presentations made by the authors at a conference on economic reform in Russia, which was held at Stanford University on November 22 and 23, 1993. Professor Kenneth Arrow from Stanford chaired the confer­ence, which was sponsored by the university's Center for International Security and Arms Control ( CISAC), under the auspices of its project on Russian defense conversion, and by the Moscow-based Institute for the Economy in Transition. Speakers included all the authors in this volume, as well as other representatives of the Institute for the Economy in Transition, the World Bank, and the European Bank for Reconstruction and Development ( EBRD).

While the breakup of the Soviet Union received much publicity, few attempts have been made to throroughly analyze the attempt to create a successor alliance--the Commonwealth of Independent States (CIS). This lack of attention may be explained by the poor performance of the CIS to date.  But it can hardly be accepted.  Presently at a crossroads, the Commonwealth has three basic options for the future: complete dissolution, consolidation along the originally envisaged guidelines, or some kind of transformation, each with unique and far-reaching consequences for both the newly independent states (NIS) and the world. Clearly, the final decision lies with the ex-Soviet republics. But the West seems to be in a position to effectively influence the republics' choice.

This paper discusses three different but closely related issues: What future exists for the CIS, if any? What are the current Western, specifically American, attitudes toward the Commonwealth? And what is the best course for the West to follow?

A remarkable tripartite collaboration. . . . A new and highly revealing account of how the Korean War began, based on a careful comparison of Chinese, Soviet, and even North Korean sources. The authors' achievement, from a historian's perspective, is roughly the equivalent of making a first flight around the hidden side of the moon. . . . An exemplary standard for the "new" Cold War history. -Atlantic Monthly

A fascinating and exciting book. Every expert on Soviet and Chinese foreign policy and every student of international relations and the Cold War will have to read it. I am awed by the materials that have been put together in this book; it is international collaboration at its very best. 

-Melvyn P. Leffler, University of Virginia

This title, the first using newly available resources from China and Russia, represents the opening of a new era in the study of Sino-Soviet relations and their effect on international politics. The credentials of the authors are the highest.
-Library Journal

This magisterial work provides the missing dimension of the Korean war - how policy was made on the communist side. Making use of previously unavailable Chinese and Soviet sources . . . this is likely to become the standard work on the subject.
-John Merrill, George Washington University.

Chapter in Democratic Reform and the Position of Women in Transitional Economies, edited by Valentine Moghadam.

Exploring the effects of the post-1989 developments in Eastern and Central Europe on the social and economic position of the women of the region, Valentine Moghadam explains how the economic crisis and subsequent development, social breakdown, and changing institutions and practices of the state have an impact upon women's roles and status. The volume combines a theoretical analysis of fundamental gender specific issues and empirical studies on aspects such as educational attainment, social security provisions, political representation, and level and type of employment. Several papers use comparative analysis, drawing on previous research into women's position during development in the Third World, and under socialism in the years prior to 1989. Countries covered in empirical case studies are Russia, Estonia, Poland, the Czech and Slovak republics, the former East Germany, Hungary, and Bulgaria. The authors draw the conclusion that women are among the principal losers in the restructuring process, both through the rise in conservative cultures, and through the economic imperatives of competing in a market-based system.

The prevention of nuclear proliferation is intimately related to stringent restraints on the supply of fissionable material available for weapons. We review the practices of the United States in providing security and control of bomb-grade material and the problems that have been encountered. We then consider the challenges to security and control of nuclear weapons material posed by the dismantlement of nuclear weapons in the Former Soviet Union (FSU).

During the most recent Russian-American summit in Vancouver, Canada in April 1993, President Clinton announced a major new initiative to assist Russia's transition to a market economy. In discussing how to aid the process of Russia's economic reform in ways of mutual benefit to both the United States and Russia, both President Yeltsin and President Clinton underscored the importance of promoting the conversion and privatization of state enterprises of the Russian military-industrial complex.

While most agree that conversion and privatization of these enterprises are laudable goals, few have discussed concrete methods of achieving these ends at the level of individual enterprises. By focusing on the actual experiences of one Russian enterprise that has both converted to almost 100% civilian production and, at the same time, become a private company, this report seeks to expand the discussion of the means and models for achieving conversion and privatization of the Russian military industrial complex.

This report covers work on conversion and privatization in the former Soviet Union that has been conducted over the past two years by the Center for International Security and Arms Control (CISAC) at Stanford University. In it, we explore the process of conversion and privatization through employee ownership. The report contains one chapter each on the major issues surrounding conversion and privatization, followed by a detailed explanation of the employee ownership method of privatization. The report concludes with the description and analysis of a case study of privatization through employee ownership: the Saratov Aviation Plant.