PIONEERS FOR PROFIT - ST-PETERSBURG ENTREPRENEURS IN SERVICES

Russian private entrepreneurs in services are truly pioneering, becaus e many services-especially trade, financial services, and most busines s and consumer services-are poorly developed. This article uses 1992 a nd 1993 survey data from St. Petersburg to assess the characteristics of these entrepreneurs, their firms, and the markets in which they dea l. Evaluation of the firms' performance establishes how well they are doing and provides insight into the determinants of success. Their per formance was surprisingly good and can be attributed to several factor s, including the existence of a substantial gap between the desired an d the actual levels of many services and the high level of education a nd motivation of the entrepreneurs themselves. Policy priorities are t o achieve macroeconomic stability, a transparent legal framework and s implified regulations, a well-designed tax code, further privatization of real estate, and better access to finance. Direct assistance progr ams would be useful in providing information, counseling, and financin g to small and medium-size firms.