To ascertain the prevalence of soft budgets and to find causes of softness, we surveyed Mongolian enterprises, asking whether state aid was expected when financial difficulties arose. One-quarter of enterprises expected soft-budgets, a large proportion of which have central government ownership....

Patterns in the cross-section of returns from stocks bought (for vouchers) in Mongolia's privatization program mirror those from developed countries: stocks in companies with high book-to-market ratios subsequently earned returns far bigger than those in companies with low ratios, a result very...