How high is the level of corruption in Russia? Is it institutionalized?

One of the most significant problems in Russia's business environment was the continued impact of corruption in both the public and private sectors. The complex central planning system of the communists left a legacy of patronage, kickbacks, and cronyism among government officials, bank employees, and productive sector managers. This culture had survived, and in many cases flourished, since the transition to capitalism, permeating and distorting many market mechanisms. For instance, one estimate suggested that annual bribes paid to police officers approached $400 million, with even higher levels of kickbacks and unofficial payments made to health and education sector officials. Low salaries and morale within the public sector were major contributors to the problem. In the financial sector, for example, crony capitalism manifested itself in direct lending on favorable terms to large, politically influential firms and the withholding of financing from more dynamic small and medium-sized enterprises.