On the playgrounds of the God and the Devil

Regardless of attempts by protestant German and Catholic Polish bishops to reconcile, regardless of Brandt's kneeling in Warsaw, of Germany's support for Poland's membership of NATO and the EU, there is still no reconciliation, and no Europeanisation. Today, we are further from reconciliation than 20 years ago. And there is no Polish-Russian, German-Czech, Romanian-Hungarian or Slovak-Hungarian reconciliation either, let alone Serb-Croat or Serb-Albanian reconciliation. Endless rounds of new wounds.

Union subsidy ? state subsidy, commissioned by Financial Research Ltd

The most frequently mentioned element of Union accession, considered by many to be the most important, is the acquisition and distribution of community subsidies. The question is whether the subsidy Hungary receives from the European Union is essentially different from what until now we have called state aid. Will the subsidy received from the Union become a component of domestic redistribution? Initial and as yet incomplete experience suggests that it is a matter of a shift in proportions rather than a sharp turn. Although additional funds flowing into the economy are still slight, the Union subsidy and the co-financing commitment have not replaced the earlier redistribution, but have come along side it to some extent. Redistribution within the economy has therefore probably grown slightly following accession, despite the fact that enterprises only received one third of the structural funds directly, the rest being granted to non-profit organisations and to the state administration in control of distribution. The weight of decisions made by the single state apparatus has not changed, and may even have grown. The system of tenders has not become exclusive at all.

2006. (Éva Voszka)

Bank Competition in Hungary

Várhegyi, É.: Bank Competition in Hungary. Acta Oeconomica, Vol 54(3) 2004.

A wasp?s nest

The Economic Competition Office?s role in shaping market structure

According to economic arguments, the monopolized enterprise structure inherited from the planned economy acts as an obstacle of market competition, so many of the big, artificially created state-owned firms have to be broken up. The state, through the Economic Competition Office as ?guardian? of competition, has to play an active role in this process. The logic is clear, but it was a matter of dispute both theoretically and in practice. The article presents the theoretical dilemmas of demonopolization that appeared during transformation. It shows the attempts to resolve them through competition regulation and the decisions of the Competition Office. The author concludes that the main role in building up competitive market structure was not played by the Competition Office, which declined the task to revise the inherited structure and to oppose several privatization decisions, considering these issues economically and politically sensitive. On the other hand, most mergers and takeovers connected with privatization were simply permitted not in contradiction with the law but sometimes by inconsistent reasoning.

Közgazdasági Szemle ? Economic Review, LI. évf., 2004. January pp.1 - 23.

All theories are vague

The relationship between privatisation and competition

The expansion of the two essential elements of economic transition, private ownership and competition, do not necessarily reinforce one other and they may even come into conflict. In Hungarian practice, privatisation was given priority over improvement in the market structure, though but not in a professed or institutionalised manner. Even in the 1990s, a decisive and consistent demonopolisation policy was lacking. Procedures were unregulated and there were no clear criteria for making decisions. By analysing the colourful palette of the organisational changes, the article demonstrates that demonopolisation was mainly an unintended consequence or side-effect of individual deals and of the government?s short-term power or fiscal considerations.

Külgazdaság, 2003 Volume 11, pp. 4-23


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