The average Russian may earn Dollars 200 a month, but as the former Communist empire adapts to the market economy, there is no shortage of students entering the country's growing number of elite business schools, which charge 50 times that amount.

While expats have given way to returning Russian "repats", the boom and industrial restructuring of the past few years has left top executives complaining that one of their principal handicaps is a shortage of good locally-trained managers. Now the education sector is beginning to respond.

In a building completed two years ago with Japanese funding, Oleg Vikhansky, the dean of the Moscow State University Graduate School of Business Administration, says he takes pride in raising his fees above those of most of his competitors. His 18-month MBA course has risen steadily to Dollars 10,500, but he says his fee-paying graduates earn starting salaries of Dollars 5,000 or more to compensate. About 250 are enrolled at any one time.

"When the World Bank and foreign donors come to some other business schools in Russia, they get requests to help them buy computers and desks," he says. "But I've always said that if we are teaching people how to make money, how can they trust us if we can't make money ourselves?"

That view is shared by Leonid Evenko, rector of the Graduate School of International Business at the Russian Government Academy of National Economy, who also chairs the Russian Association of Business Education. "Our philosophy is that it is immoral for business education to take money from government," he says.

Not long ago, he recalls US business schools coming to Russia and offering short course unaccredited MBAs of little value. "They asked to use our diplomas," he says. "They said they would do all the teaching, and would pay us Dollars 1,000 per student - in cash in an envelope."

Today, Russia can point to something more substantial of its own. Mr Evenko's organization has raised quality since the early 1990s, and in 1999 persuaded the Russian ministry of education to launch an "MBA experiment". Now 33 faculties in 31 cities offer accredited degrees to about 3,000 students each year, and the Association is recognized by the European body EFMD.

He says the European model of MBAs was judged more appropriate for Russia. "US courses are too expensive and long. European courses are more pragmatic and commercially oriented." But he argues that one drawback is the demand for a significant proportion of faculty and students to be international.

"That makes sense when the EU is placing emphasis on tighter integration, but what does it mean for Russia? Should we hire Kazaks and Ukrainians?" he says. "We do have one Mexican student."

Many managers, including foreign top executives working for Russian companies, still place great emphasis on graduates with MBAs earned abroad, or established organizations such as the UK's Open University that offers distance learning in Russia.

That makes sense for people planning to study and work abroad, but Mr Evenko and his counterparts stress the value of Russian education for the large numbers remaining at home. "Our courses are based on the realities of Russian business. They use Russian case studies, teachers who consult, and research based on Russian experience," he says.

Sergei Myasoedov, rector of the Academy's Institute of Business Studies, agrees. "Even the oldest business schools in Russia like ours are still only teenagers," he says. "You can't create a marble statue of Apollo out of mud."

He says it has taken time to adapt to the case-study method of teaching, given the more academic tradition of education in Russia. "A few years ago, people said 'we have paid you money to teach us, so why are we teaching you?' But that has now changed."

In the Russian business culture, "especially in a country which is people - not task-oriented," he places emphasis on the value of networking with fellow students, and on sharing experiences and learning from good teachers.

National peculiarities are also reflected in the curricula. Mr Myasoedov says he realized the importance of ethics even in the operation of business schools themselves when after Russia's 1998 financial crisis, he was willing to take on a former go-go dancer as a student to raise money. His partners in a joint executive MBA programme with the University of Antwerp refused.

"The main difference here is ethics and morality," says Mr Vikhansky. "Russian business is still in the initial stage of the accumulation of capital - accumulation by any means.

"Our students come looking at business as about making profit, and think that includes cheating the customer. We teach them skills, but our main objective is to try to change their behavior."

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