The paper begins with a short review of key institutional arrangements for labour participation in the management of the Soviet enterprises. Next, sociological evidence is presented which indicate: (a) that the apparatus of labour participation is largely inadequate to fulfil the declared aims of perestroika, and (b) that many workers find it much more rewarding to participate instead in the activities of the second economy. These results are explained in the last section by referring to a series of interrelations between the processes of 'statization' and 'privatization' in Soviet society.
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