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Exit strategies of family businesses in Hungary
43-63Views:224The study aims to examine the ownership transmission strategies in the context of family firm succession in Hungary. The successful transfer of ownership, management and acquired experience at a family firm represents one of its greatest challenges; however, there is still a lack of understanding of the unique future strategies and succession outcomes of Hungarian family businesses. As a significant proportion of the founders of those family businesses established after the regime change (post-1989) are now reaching retirement age, a study of how such business organisations plan to survive the generational transition is highly relevant. This study applies a mixed methodology of quantitative and a qualitative analysis (e.g.,
in the case of IPOs). The results show that the average age of the examined family firm CEOs is higher than the global average and the majority of them plans to keep ownership and management within the family. Other exit strategies (i.e. initial public offerings, mergers and acquisitions) are not typical of the examined sample. -
Roadmap for the adoption of the euro in Hungary: dangers and opportunities
Views:151In April 2003, the EU Accession Agreement was officially signed for the Czech Republic, Estonia, Cyprus, Hungary, Latvia, Lithuania, Malta, Poland, Slovenia and the Slovak Republic. These countries are destined to become EU members in May 2004. As part of the “acquis communautaire”, participation in the new version of the exchange rate mechanism (ERM II), and subsequently in the European Monetary Union (EMU) is obligatory for all new EU members (no opt-out clause is available). Therefore, the question today for the accession countries is no longer whether or not to enter the eurozone but rather the time horizon when the entry should happen.
Journal of Economic Literature (JEL) code: E42, E58, F33.
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Twenty-one Economic Arguments against an Unconditional Basic Income
5-29Views:362In 2013/14 there has been an intense public debate both in the European Union and in Hungary on the feasibility of Unconditional Basic Income (UBI) support. In the Hungarian context, the publication of a 100-page proposal was an important milestone, in which a group of experts applied the UBI concept to the present circumstances. The study, the brainchild of István Bánfalvi, a distinguished social policy practitioner, proposed the following specific amounts as from January 2015: HUF 25,000 for children (≈ EUR 83), HUF 50,000 for adults and HUF 75,000 for expectant mothers. The present paper’s first objective was to challenge the entire 25-50-75 concept from both theoretical and practical-administrative perspectives. In addition, we tried to show that income poverty in Hungary is much less of a problem than generally presumed. Our final conclusion is that from a poverty alleviation point of view the geographical remobilization of the Hungarian Roma population is by far the most important issue. Roma living in small rural settlements should be assisted to move towards large cities, where the chances of finding work, education and health care are much better.
Journal of Economic Literature (JEL) classification: H21, I38, J15
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Trends and Tendencies in the Development of HR Departments in Hungarian State Universities
115-146Views:274In the last couple years it has been fully accepted that human resource management plays an increasing role in the success of organizations, and also in the development and sustainability of national and international competitiveness (Gordon- Whitchurch, 2007). In the developed industrial countries – mostly the Anglo-Saxon pioneers – public institutions (including higher education) abandoned the normative and bureaucratic-controlled Taylor system (Karoliny et al, 2003). Beginning in the 70’s representatives of the New Public Management model, based exclusively on the effectiveness of business solutions, gained more ground. The early 80’s brought the widespread implementation of reform programs. These efforts have created models and experience that were applicable in the converging countries of Europe – including Hungary. After reviewing the latest professional literature and analyzing practices of eleven Hungarian universities we will assess the conversion of Human Resource Management and consider possibilities for modernization.
Journal of Economic Literature (JEL) classifications: I21; H19; M52;M53;M54
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A Review of Hungarian Research Antecedents and the Assessment of Fair Trade in Hungary
54-68Views:474Fair trade is a civil initiative aiming to provide fair conditions to the poor producers of the Third World and enable them to follow a sustainable model of development. This realigned commercial partnership is to modify the rules of traditional international trade between the producers of the southern nations and purchasers of the northern hemisphere and replace them with a novel alternative. Fair trade has unified techniques of labeling and a well-established institutional system in order to change the rules of the game that have controlled the dominant economic model. The main tool of the movement is the engagement of conscious and socially responsible consumers towards the topic. This review summarizes the Hungarian reports and studies done about the issue so far and introduces the present circumstances in Hungary.
Journal of Economic Literature (JEL) code: F13, F18, J81, P45
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Trade Advantage and Competitiveness of Hungarian Agri-food Exports with the European Union
87-102Views:94The complementarities of trade advantage and trade competitiveness measures for Hungarian agro-food trade with the European Union are analyzed. The stability and duration of the trade measures over time is investigated by survival analysis using the nonparametric Kaplan-Meier product limit estimator and the consistency test between the trade measures is conducted by the stratified Cox proportional hazard model. Hungary experienced a greater number of products with relative trade disadvantages and a greater significance of one-way imports. Hungary also experienced relative trade advantages for bulk raw commodities, processed intermediates, and horticulture, with the greatest significance of successful quality competition and one-way exports, and the lowest significance of unsuccessful price
and unsuccessful quality competition. The duration of relative trade advantages is longer than the duration for the successful trade competition categories. Our results confirm that relative trade advantage is consistent with the one-way export and the successful price and successful quality competition categories in two-way trade on the one hand, and relative trade disadvantage with the one-way import and the unsuccessful price and unsuccessful quality competition on the other.Journal of Economic Literature (JEL) classification: Q12
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The shift from Office to Customer Oriented Culture: the Case of the Hungarian Post: Liberalizáció és szervezeti változások a postai szektorban
143-158Views:235The case study is conducted within the framework of organizational change and organization innovation, and examines the changes in knowledge requirements and the alterations caused by the liberalization generated by the Magyar Posta Zrt. The study focuses on the transformation of official attitudes, the make up of the required knowledge and how organizational changes have facilitated the development of a customer-oriented organizational structure. Based on the interviews conducted, the conclusion is that the process of “providing service ex-officio” has not yet been completed, but the employees are increasingly becoming involved in a client-centred approach. On the management level the preservation of the hierarchy and the status quo have more importance than the expression of the new organizational values.
Journal of Economic Literature (JEL) classifications: D23, M14
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Network Analysis for Market Surveillance
19-33Views:142Our analysis has focused on the network structure of the credit default swap (CDS) market because relatively few publications have appeared on this segment of the financial market. The article puts emphasis on a proposed new supervisory tool which uses network science in market surveillance of the Hungarian financial market. Our research results are compared to those of a previously published ESMA analysis, where the writers applied network science to analyze financial market contagion risks. As a result, the article concludes that the Hungarian sovereign CDS market network structure is similar to the European one in the sense that it is highly concentrated.
Journal of Economic Literature (JEL) codes: G14, C45
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The structure and the behaviour of the capital of cooperative banks
59-77Views:100Today cooperatives are unable to function according to traditional cooperative principles, as the changes in the economy have altered the basis for the operation of cooperatives as well. There are a number of regulations affecting the members of cooperatives and investors ranging from the foundation to the ditribution of dividend, from the volatility of capital to investing into a cooperative, which are carried out in comparison with other forms of investment in the market. By now in Europe debates about cooperatives have become more heated; the documents of the European Union especially the ones concerning social economy also testify to this. It is for this reason that the study has chosen the examination of cooperative banks. The authors present the structure of cooperative banks, the changes in the structure, as well as the behaviour and characteristics of cooperative capital.
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HR Funtion Under Changes at Subsidiaries of Foreign Multinational Firms in Light of an Empirical Study in Hungary
98-116Views:423Following almost two decades of multinational companies (MNCs) operating in the transitional economies of Central and Eastern Europe (CEE) expatriate and local managers continue to ask the following question: “How can we effectively manage the available human resources from our subsidiaries or assignees from the corporate centre?” A model of human resource (HR) practices in the subsidiary units of MNC’s in Hungary was developed from a review of the literature, extensive professional experience in the region and an interview-based survey at 42 subsidiaries of large multinational companies. This model describes the evolution of different HR variables in the light of external (macro) and internal (firm specific) factors.
Journal of Economic Literature (JEL) classification: M16, M51, M52 és M54
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Regional netwrok cooperation
115-130Views:113The current study aims to reveal the regional network cooperations - found primarily in the construction industry -, in particular in the Észak-Alföld Region. The study includes three main parts: after the industry analysis of the construction industry a short summary follows about the theoretical bases of today's business network cooperations, clustering, and such relationships especially among firms operating in the construction industry, and finally it is closed by a case study revealing the relationship network of a dominant construction company of the Észak-Alföld Region. The most important finding is that in Hungary clustering in the construction industry - that has already existed in several developed economies - has not started yet, however, networking - that can be the basis for the development of a construction industry cluster - has already began, and if it continues, it further increased the advantages already experienced.
Journal of Economic Literature (JEL) classification: L140, L850
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Regions and the European integration: The Europeanization of the regions in Central and Eastern Europe
54-68Views:92The process of Europeanization that is the adjustment of the national legal regulations, intstitutions and decision making patterns to the European political practice leads to the significant transformation of the national political systems. In the horizontal dimension of the state institutions this concerns primarily the relationship between the executive and the legislative powres whereas in the vertical dimension this influences the relationship bewteen the central state and the regions or provinces. The paper examines the source and durability of the Europeanization process in three Central and Easterna European countries, in Poland, Hungary and Czech Republic. Focus is primarily laid upon the institutional adjustments.
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Political Economy of Fiscal Reform in Central and Eastern Europe
66-75Views:85The reform of public finances has been at the centre of the post-socialist transition of Central and Eastern Europe since the early 1990s. At various stages of the transition, the reform process encompassed the entire gamut of public finances: the national budget, sub-national finances, extrabudgetary operations, and state-owned financial and non-financial enterprises. For the most part, fiscal reform was a non-linear stop-and-go process – often characterised by backtracking as well – and was uneven across countries. Moreover, unlike most reform experience in the rest of the world, fiscal reform in this region took place against the backdrop of a radical break, as sovereign countries emerged from a colonial past following the collapse of the Soviet Union. An important milestone was reached in 2004–2007, when all ten countries covered in this article became members of the European Union. The purpose of this article is to discuss fiscal reform in Central and Eastern Europe from the perspective of political economy. Following an overview of basic reform trends, the article focuses on the principal drivers and impediments to reform in the region. To conclude, the ingredients of successful reform are examined. The article does not provide an exhaustive inventory of reform measures, nor does it offer a survey of broad political economy issues prior to or during the transition period. Country references are intended to serve as stylised illustrations of main points, rather than as a comprehensive documentation of reform episodes.
Journal of Economic Literature (JEL) classifications: H1, H3, P2, P52.
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The institutional background of factoring
71-96Views:131The article examines the Hungarian financial institution system from the point of view of factoring. In the interest of clarifying concepts, the article compares the judicial and economic use of the concept, introduces the intermediary system, the banking system, and the financial institution system. It outlines the contradictions in institutional regulations relating to factoring and the history of the development of regulation in the financial sector in Hungary from the 1970 to the present. Besides presenting the deficiences in the regulatory system, the article suggests several alternative modifications to the Law, thus highlighting the significance of factoring. In this analysis the author deals with both international and national practices, which can both be used as a basis for future legal regulations, providing answres to the questions raised in the article concerning the institutional structure.
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Eastern-European education and economy
73-82Views:107The main reason for the inability of the Eastern-European region to catch up economically is thought by many to be the fact that for a decisive period the state curtailed the incentive power of private property. The harmful effect of this was aggravated by the arms race. Contrary to this, this paper claims that the main reason is the underdevelopmnet of the population's knowledge base. The direct factor in this is the mistaken education policy, which because of the emphasis on quaility in schooling, imparted a low and weak knowledge base to the growing generation. The author claims that without a general and radical reform of education the eastern European region and Hungary as well, will lag behind in international competition.
Journal of Economic Literature (JEL): I21, I28, O15
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The international competitiveness of the domestic economy: interpretations, figures and a few considerations
20-41Views:100Although the (improvement of) international competitiveness of the Hungarian economy is in the foreground of both the proclaimed efforts of the economic policy and that of the discussions of the trade, the fact that competitiveness at national level is a less precise term of economics with various meanings. This paper first discusses whether competitiveness at national economy level is interpretable at all. Then it examines what this notion does not mean and what it might mean. After reviewing the possible interpretations, the paper describes some of the figure of competitiveness of the domestic economy relating to a few international comparisons. Finally, it draws up some considerations as to what might and what might not be (or only with limitations) the means for the economic policiy to improve domestic competitiveness in the short and long terms.
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A kulturális és kreatív iparágak a világ legfrekventáltabb régióiban
Views:187This study touches on and organises the definition of the creative industry, creativity and the differences in terminologies used within the creative economy. These help to form and idea of which areas different countries or regions consider dominant from the developmet point of view. Beyond this, the study describes the attempts to map out the conceptual system of the creative economy and its statistical measurement. It therefore examines the statistical, economical and social characteristics of the creative industries, in accordance with the Europe 2020 Strategy and other professional documents. It aims to provide a comparative analysis of different regions' creative industries. Lastly, regarding to Hungary, it defines future tasks.
Journal of Economic Literature (JEL) classification: Z1
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Prognosis of the Roma population in Hungary by region till 2061
39-74Views:966In our paper we try to give an overall picture about the countrywide and regional demographic characteristics of the Hungarian Roma population, to make a roll-forward calculation of the next decades until 2061 by region. It indicates the actuality of the study that in the last decades the population of the Hungarian Roma minority and its rate according to the whole Hungarian population permanently and materially increased. In the next decades in both further growth is expected, but the speed of this growth will be slower and slower. The fertility and the mortality of the Roma population will decrease, life expectancy will increase, these result in the increase of the rate of the aged population. Out estimation indicates that until 2061 the age pyramid of the gypsies’ changes, it will be more and more similar to the present one of the whole Hungarian population.
Journal of Economic Literature (JEL) codes: C82, J11, J13, J19
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Was there a stock market bubble in Hungary?
Views:209Bubble is one of the most frequently used and colorful terms in economics. However, it is rarely explained in detail, most economists more or less agree on what it means. In the following paper we are going to show that the widely accepted explanation of bubble contains controversial, tautological reasoning. It is challenged from the theoretical side, but practical consequences will also be mentioned. Two questions hiding in the title above will be answered. First is to give a conceptual framework for analyzing stock prices to decide whether we can label as a bubble particular movements, upward and downward tendencies in stock prices. Second, with a coherent and consistent definition we will be able to answer the question whether there was a bubble in the Hungarian stock market between 1995-2002.
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Nyugdíjreform-dilemmák – jövedelemelosztási arányok és makropénzügyi egyensúly
5-32Views:131The paper aims to outline the main relations and critical points of the pension system which make the reform of the whole system inevitable in near future. The most important cause stems from demographic change: in the developed countries average life expectancy is rising rapidly while the number of births is diminishing. This results in rising retirement outgoings and decreasing revenues from superannuation taxes. In addition to this medical expenses are increasing due to the development of treatment methods. In contrast, in Hungary the average life expectancy will only increase after 20-30 years. The main problems of the distributive systems are rooted in the particular characteristics of the political change following the collapse of communism. The level of employment decreased dramatically and there are many tax arbitrage opportunities. In addition nowadays 90% of employers tend to retire on a pension before retirement age. These factors make the main distributive system unsustainable. Additionally the elderly dependence rate will double in the next few decades. Parties debating a socially and financially sustainable main distributive system agree on the inevitability of an increasing role for self-provision and a cut in the growth in expenditure. The pension system will not be able to keep pace with growing wages, to guarantee insurance principals and a minimal income in old-age, and to meet the requirements of long-term financing at the same time, especially not in the period of demographic changes.
Journal of Economic Literature (JEL): I38, J11, J26
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The joining negotiations in rapport with the EMU
75-87Views:116The study surveys the field that deals with the Eastward expansion of the European Economic and Monetary Union /EMU/ after the joining negotiations, involving the probable legal, political and economic dilemmas and problems of the introduction of euro in Hungary. The joining contract and the relevant documents unambiguosly outlining the items within the monetary integration for the Hungarian economy can be planned. It also examines the chosen monetary integration for the Hungarian economy can be planned. It also examines the chosen monetary-political systems of the candidate for membership countries from the relevant European regulation point of view, just as the possibility of individual solutions.
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The question of duality in post-transition economic development
71-90Views:169One of the main questions of the FDI-based economic development model is how the local embeddedness of technologically advanced, globally operating multinational firms can be increased. The global economic integration of smaller, locally owned firms could be enhanced by the stimulating spillover effects stemming from multinationals. However, if the two main sectors of the economy function in isolation from each-other, stimulation effects cannot appear. This paper studies the features and extent of structural duality in Hungary, and the preconditions for deepening economic ties between the two sectors and
of the utilization of positive externalities stemming from the presence of large multinational firms.JEL classification: F23, L53
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A behavioral economics approach to perceived inflation
46-71.Views:253Recent years have brought an era of extremely low inflation both in Hungary and in the EU. However, the inflation perceived by consumers has not followed precisely the same path. In the article I attempt to shed light on the underlying causes of this discrepancy, using the concepts of behavioral economics. A summary of the results of the relevant literature and an empirical analysis of Hungarian perceived inflation patterns (both on the aggregate level and for demographic groups) form the backbone of the article. The main findings of the research show that there is a significant bias in the inflation perceptions of Hungarian individuals, caused by psychological phenomena. The extent of the bias varies among sociodemographic groups, but not in exactly the same way as one would expect from the literature.
Journal of Economic Literature (JEL) codes: E03
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The aspects of the Hungary's Adult Training
36-55Views:191The study surveys the most important aspects of the national adult training from educational economy point of view. The authors examine the national limits of legal rule of adult training. They present the different sub-systems of adult training i.e. the educational system, the non-educational system and the working place training characteristics of participation making international comparison too. We look over the target groups of adult-training and the participants motivation of the teaching arena. We also have a look at the domestic costs of the different froms of adult-training, and the division of this expenditure among the participants.
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Revealed comparative advantage in Hungarian agriculture: a chaotic or coherent pattern?
59-82Views:114We describe the evolving pattern of Hungarian agri-food trade using recently developed empirical procedures based around the classic Balassa Index at various aggregation level and different bechmark between 1992 and 2002. Our results shows a significant geographical differences and across sub-sectors of 1, 2, and 3 digit SITC classification. The extent of trade specialisation exhibits a declining trend for all benchmarks; Hungary has lost comparative advantage for a number of product groups over time. The indices of specialisation have also tended to converge. For particular product groups, the indices display greater variation. They are stable for product groups with comparative disadvantage, but product groups with weak to strong comparative advantage show significant variation.
Journal of Economic Literature (JEL) classification: Q12