Creating Competition by Bargaining. Demonopolisation and State Aid during Transition

State redistribution maintaining a soft budget constraint and a centralised organisational system for companies were some of the essential characteristics of the centrally planned economy. Transition may have been expected to strengthen competition alongside private ownership. The large companies, created artificially at an earlier period, should have split up and redistribution diminished as a distortion of competition. In contrast to this, everyday life at the turn of the millennium in this country echoes with the news of monopolistic tricks and large mergers. We are also informed of redistribution plans and schemes outbidding each other, not to mention the promises of European Union subsidies.
Have the structural foundations for competition really remained weak in Hungary? What kind of economic and social interests are preserving subsidies as a narcotic, and what sort of forces are causing the cyclical nature of redistribution? Can competitiveness be strengthened in the long run at the expense of competition? Besides the theoretical framework and analyses of socio-economic dilemmas, this book offers the Reader a colourful palette of government decisions and actual company cases. It assembles the mosaics of successes and encoded failures by using personal conversations and articles from the daily press, considered to be an archive of contemporary history.

Akadémia Publishing House 2003 Tovább»​​​​​​​

Ownership and Corporate Governance in the Hungarian Large Enterprise Sector

Privatization of the post-socialist economies, including the transfer of state assets to other proprietors, new start ups and green field investments has produced a wide variety of ownership structures in Central and Eastern Europe. One of the main question discussed in recent years concerns the basic characteristics of the post-socialist ownership. Are the new structures peculiar as compared to recent Western market economies, as several researchers argue (Stark 1996, Earle and Estrin 1997, Andreff 1998)? Is the dominant form some kind of recombinant property, i.e. a mixture of state and private ownership, dominated by inter-organizational (corporate) shareholders (Stark 1996, Stark and Kemény 1997)? Or we face a model of managerial capitalism, as Szelényi-Eyal-Townsley (1996) suggest?
This paper analyses the Hungarian case that seems to be rather special in comparison to other post-socialist countries - but not peculiar in comparison to some other market economies. We will argue that the basic features of the ownership structure in big enterprise sector are not dominated by specific institutional solutions. If there are some specific features, they include mainly quantitative aspects (like the concentration of assets, outputs and ownership positions, the predominance of foreign investors) instead of qualitative ones.

In: Corporate Governance in a Changing Economic and Political Environment: Trajectories of Institutional Change, Michal Federowicz, Ruth V. Aguilera eds., Palgrave MacMillan, New York, 2003. 170-194. Tovább»​​​​​​​

Privatization as a ?Learning Process?: The Case of Hungary

Hungarian privatization is considered as a process which has been dominated by standard methods. Most of the firms were sold via public tenders, private placement or public offerings and state budget generated significant cash income from selling. A detailed analysis, however shows that the course of privatization has neither been direct nor uniform even in this country. Every conceivable approach occurred on the scene during the last decade, including free distribution to individuals and institutions or preferences to different types of buyers as well as loosely controlled movements and centralized governmental decisions.
The intention of this paper is to show some reasons behind these fluctuations. Privatization is regarded here as a learning process. Learning process not in a technical sense but rather a trial and error approach, an adjustment of all main actors (governments, enterprise management and potential new owners) led partially by constraints, partially by changing opportunities.

In: Successful Transitions, Political Factors of Progress in Post-socialist Countries, Jürgen Beyer, Jan Wielgohs, Helmut Wiesenthal eds., Nomos Verlagsgesellschaft, Baden-Baden 2001. 139-152. Tovább»​​​​​​​

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