Informal economic relations and organizations: everyday organizational life in Soviet and post-Soviet economies

Purpose
This paper aims to identify the role of informal economic relations in the day-to-day working of organizations, thereby opening a way to theorizing and informed practice. We will present and discuss about the manifestation of informality in ‘everyday’ reality of Soviet and transformation economies. Informed by Cultural Theory and in particular the work of Gerald Mars, we are taking account ontologically and methodologically of Labor Process theory
Design/methodology/approach
Through presentation of ethnographic data of detailed accounts and case vignettes in production and retail in the Soviet period of the late 1970s and 1980s and from the construction sector in contemporary Russia, with a focus on the labor process, we inform and discuss key processes in the informal working of organizations.
Findings
In the Soviet system the informal economy co-existed in symbiosis with the formal command economy, implicitly adopting a ‘live and let live’ attitude. In addition, informal relations were essential to the working of work organizations, sustaining workers’ ‘negative control’ and bargaining power. Contemporary Russian capitalism, while embracing informal economic activities, a legacy of the Soviet period, advocates an ‘each to his own’ approach which retains the flexibility but not the bargaining space for employees. That facilitates exploitation, particularly of the most vulnerable workers, with dire consequences for the work process.
Research limitations/implications
The paper provides a platform for theorizing about the role and place of informal economic relations in organizations. Of importance to managerial practice, the paper informs on those aspects of the work routine that remain hidden from view and are often excluded from academic discourse. The social implications are profound, shedding light on central issues such as recruitment, income distribution, health & safety and ’deregulated forms of employment.
Originality/value
The paper examines economic behavior under different economic-political regimes demonstrating continuities and changes during a fundamental social-economic reorientation of an important regional economy, through close observation at the micro and meso-level of, respectively, the workplace, organizations and industry, outlining theoretical, practical and social implications.

This article is © Emerald Group Publishing and permission has been granted for this version to appear in the Middlesex University Research Repository. Emerald does not grant permission for this article to be further copied/distributed or hosted elsewhere without the express permission from Emerald Group Publishing Limited. This is the accepted version of the manuscript "Informal economic relations and organizations: everyday organizational life in Soviet and post-Soviet economies", published in the journal "Journal of Organizational Change Management"available via the journal site at: https://doi.org/10.1108/JOCM-05-2015-0081