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Is the strategic thinking characteristic of SMEs in the North Hungarian Region? – experiences of a survey
88-100Views:134Regional differences can be observed in the economic importance of small and medium sized enterprises. The research covers the small and medium enterprises within the North Hungarian Region, based on a questionnaire carried out in the autumn of 2011. We examine the existence of a conscious strategic vision of the future and their innovative capability. The low economic activity, the low proportion of industrial enterprises, which is below the national average, and low professional skills are typical of the region. Those managers who have a conscious strategy reported above average profitability. We revealed a correlation between the depth of strategy knowledge and the existence of a formalized strategy, paying attention to the role of education and skills. The knowledge and the acceptance of innovational cooperation opportunities (innovational nets) are at a low-level in the region. Besides strategic thinking, one key element for strengthening the sector is continuous renewal, innovation, observing best practice, and imitating it.
Journal of Economic Literature (JEL) classifications: D220
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Regulatory Coherence and Economic Growth
33-54Views:138The paper is aimed at examining differences in market regulation across countries. Its starting point is the puzzle that poor countries apply more regulatory measures than rich ones do, although it has been empirically shown that those countries that regulate less grow faster. To explain this contradiction, the paper introduces the concept of regulatory coherence, and tries to explain the differences in this concept, together with the differences in the general level of regulation. The main argument is that regulatory coherence as well as the general level of regulation is dependent on the external, broad institutional system, because this affects the incentives of the regulators. The paper tries to support this theiretical argument empirically by a cluster analysis.
Journal of Economic Literature (JEL) classification: B53, M13, L51
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Classical liberalism, democracy, and economic growth: a hypothesis about the Lipset hypothesis
5-30Views:229Does economic growth create democracy, as suggested by the proposition known as the Lipset hypothesis? According to this paper, for the Lipset hypothesis to be valid, it is sufficient for an ideological and a technological condition to be fulfilled. The ideological condition is that the political agenda-setting ideology should be classical liberalism, which can be characterised as combining an aversion towards democracy with a positive assessment of economic and civil liberties. The technological condition is that the country in question should be advanced enough in the technological sense, because in such a country there is no economic growth without innovation maintained by a free market for ideas. Logit regressions run with panel data show that in the period up until the early 20th century a higher per capita income increases the probability of a democratic regime change, but afterwards it does not. The explanation is that before the early 20th century the two conditions were met, but they were not met in those countries that were about to become democratic after the first two decades of the 20th century.
Journal of Economic Literature (JEL) codes: D70, O11, O43
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Openness and growth
126-134Views:117The classical theory of commerce encourages the liberalization of international trade on the grounds that this contributes considerably to the growth of welfare. This study sets out to explore this hypothesis empirically by analysing the relationship between external market openness and per capita GDP examined in twenty-two OECD countries between 1950 and 2000. The results bear out to support the existence of a positive correlation. The novelty of the study is that the author pays special attention to the temporal aspects of the interaction between openness and per capita GDP which can be characterised in terms of a nonstationary and nonlinear trend, as expected.
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Corrupt German companies? A political economy approach to German corporate scandals of recent years
97-114Views:103The paper seeks to explain German corporate scandals of recent years from a political economy point of view, adopting a 'varieties of capitalism' approach. Scandals have taken place in two realms of corporate activities: (i) in industrial relations defined by the system of Mitbestimmung that my well constrain corporate restructuring, and (ii) in export markets where corrupting foreign officials has always been a widespread practice among large exporting companies, including export-intensive German manufacturing corporations. In recent years institutional changes in domestic and international markets, including regulatory regimes, have significantly altered the set of viable options for corporate strategies. In consequence, large German companies have to adjust to new circumstances. Although the institutional underpinnings of coordinated market economies have been changing, German corporatism is not set to vanish yet.
Journal of Economic Literature (JEL) classification: P16, F55
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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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The development of companies producing alternative protein end-products
3-23Views:32Excessive consumption of animal-based protein has led to a significant negative impact on the environment and human health. Companies producing alternative protein end-products aim to produce substitute products that are similar to conventional animal-based products with less environmental impact. In this research, 955 alternative protein companies were analyzed using descriptive methods. The results revealed a significant increase in the number of companies after 2015, indicating high industry potential and an increasing global focus on sustainability. Plant-based products dominated the production structure because they were more appealing to consumers and may reach price parity sooner. Current food systems are unsustainable. Thus, although some factors still hinder the market uptake of alternative proteins, a shift towards a more sustainable food system is inevitable in the future.
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Economic Principles of Predatory (Exclusionary) Pricing in the US and in the EU their (mis)Application in Some Recent Competition Law Cases of the European Community Commission and the Court of First Instance
26-45Views:139Predatory pricing is one of the most debated issue among the many possibly abusive behaviors of a dominant firm. The general prohibition of the abuse of a dominant power in the competition law is meant
to render more difficult to use that power but not to disable them to compete. The borderline between a rough but lawful competitive behavior of a dominant firm and the illegal abuse of the market power could sometimes be very narrow. One of that narrow line is associated with the so called predatory pricing or exclusionary pricing. One of the necessary preconditions for predatory pricing is that the firm is required to set the price below costs. But could it be a sufficient condition as well? Before the AKZO-case lawyers and economists seemed to agree that predatory pricing requires a second phase, after the dominant firm successfully got its prey in the first phase, the recoupment phase during which the dominant firm is able the regain all of his former losses occurred in the first phase. Since the AKZO-case, the Commission succeeded to convince Courts of the EU that it would be enough to make probable but not certain that there had to be a recoupment phase but we don’t have to wait until it really happens. Most of the economists still think that predatory pricing is meaningless without recoupment, and what is more important, it would be beneficial to the consumers during the first phase unless there is no certainty of a second phase.Journal of Economic Literature (JEL) classifications: K21, L12, L41
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Competitive adavntages: Theory and corporate practice
51-70Views:140The competitive advantage achieved by a company basically influences its profitability and market position. The article shows that in addition to this the evaluation has many other criteria, and the management must consider these when defining competitive adavantage. The study explains that as a result of the acceleration of technological and economic development, the globalization of economic processes, and the evaluation of networks of interdepedence, the management have to face new types of competitive advantage. To choose between these the management has to consider competitive vulnerability. Following this the article attempts to summarize the basic law of the theory of competitive advantage, before introducing the most important management techniques for the selection of competitive advantage. Finally, the study emphasizes that the key factor in achieving a competitive edge and the success of different management techniques is the CEO, and through the model of the "CEO's personality pyramid" it explains the requirements that the manager has to meet.
Journal of Economic Literature (JEL) classification: O30, O32
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The Cross-border Mergers’ Market and Financial Characteristics from the Perspective of Foreign Direct Investments in Hungary
30-46Views:183One of the methods with which foreign corporations practice direct investment is CrossBorder Mergers and Acquisitions (CBM&A). This can be proved by statistics: globally until the mid 1990s CBM&A accounted for about 50% of total Foreign Direct Investments (FDI) and reached 100% in 2000. This trend was not typical in Hungary. However, it reached 100% in 2009. I have two goals in this study: the first is to analyse how this phenomenon occurred in Hungary. In my study I analyse not only the correlation of CBM&A and FDI, but also foreign portfolio investments. My other goal is to analyse the characteristics of CBM&As from the perspective of FDI. I analysed the 343 decisions made by the Competition Authority. Finally, I compared these results with the features of FDI, which support and complement the results gained through statistical calculations.
Journal of Economic Literature (JEL) classification: F21
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A review of the border effect literature – is domestic trade really biased?
81-102Views:147The aim of this article is to give a comprehensive review of the border effect literature. The author demonstrates through a number of empirical results that state borders still obstruct commodity trade flows between countries significantly, even in the twenty first century’s globalized world market. Countries’ trade patterns show a massive bias toward domestic markets, which can be only partially justified by formal factors such as income differences, distances, tariffs, cultural or linguistic dissimilarities and different currencies. Controlling for all these factors does not abolish the hindering role of borders, which suggests that the preference for domestic partners is excessive. The paper analyses major gravity model specifications and estimation methods in order to shed light on solving the border puzzle.
Journal of Economic Literature (JEL) kódok: F14, F15