Outsourcing elderly care to private companies in Russia: (non)compliance and creative compliance as responses to the principal-agent problem

ABSTRACT

Why do regions (non)comply or creatively comply in response to federal-driven reforms in Russia? This article studies the interplay of interests and incentives prompted by a contract between a principal and agents on the one hand, and shaped by the regional socio-economic context on the other. The analysis proved that the incapacity of the public sector to satisfy the societal demand for services in urbanised areas encouraged compliance. The creative compliance results from a need to demonstrate commitment to the reform in regions with a lack of favourable conditions. Non-compliance is adopted in ethnic republics and in relatively poor regions.

KEYWORDS:

• Outsourcing of social services
• principal-agent theory
• creative compliance
• Russian regions

Acknowledgement

I would like to thank Tatiana Tkacheva and my colleagues from the Center for Comparative Governance Studies at the National Research University Higher School of Economics (St. Petersburg) for high quality discussions, valuable comments and support.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 Twelve Russian regions were not included in the data set. The Republic of Crimea and the federal city of Sevastopol became part of the Russian Federation in 2014 (one year prior to the reform) and cannot be considered an integral part of its social, political and economic space, and in comparison to other regions. No official lists of providers of social services were available in open data sources in five Russian regions per 2017 (the Republics of Ingushetia, Tyva, Chechnya, Dagestanand Moscow City). Four autonomous districts and one autonomous oblast were excluded because of their specific status in the Russian federal system, representing obvious outliers.

2 Official website of Opeka, available at: https://sgc-opeca.ru/spb/ (accessed May 2, 2022).

3 Official website of Senior Group, available at: https://www.seniorgroup.ru/ (accessed May 2, 2022).

4 Official website of the Zabota service, available at: https://zabota365.ru/ (accessed May 2, 2022).

Additional information

Notes on contributors

Anna Tarasenko

Anna Tarasenko is a researcher at the National Research University Higher School of Economics (St. Petersburg) and visiting researcher at the Aleksanteri Institute (Helsinki University). She has recently contributed as an editor to “Reforming Child Welfare in the Post-Soviet Space: Institutional Change in Russia”, edited by Meri Kulmala, Maija Jäppinen, Anna Tarasenko and Anna Klimova in the Routledge Advances in Social Work series in 2021. In co-authorship with Linda J. Cook and Elena Iarskaia-Smirnova, Anna has published “Outsourcing Social Services to NGOs in Russia: Federal Policy and Regional Responses” in Post-Soviet Affairs in 2021. Anna’s work has appeared in Europe-Asia Studies, East European Politics and the Journal of Social Policy Studies. She has diverse experience as a researcher at the European University at St. Petersburg, the National Research University Higher School of Economics (St. Petersburg, Russia) and the University of Helsinki (Finland).