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• The prospects of uniformization of the internal market of electricity in the European Union

  3-22

  Eva Sztanko

  Views:

  240

  The European internal market of electricity is not yet uniform, although it has been moving toward this direction for the last two decades. The energy market position of the consumers has been strengthening, the liquidity and the cross-border trade of the European electricity markets has been increasing. The stronger competition limited the wholesale prices. Despite the backsliding or stagnating household and industrial consumption, however, the retail prices and the costs have been increasing. The EU has to carry on reforming the electricity market in order to satisfy the need for more flexible energy-systems, to increase the competition, to make the consumers react to price changes in a more flexible way, to create more cost-effective governmental/market measures to handle price volatilities, to finance investments, and to minimise cost increases. The most recent comprehensive recommendations of the European Committee intend to create a new electricity market model, however, it yet remains to see the reception of these on behalf of the member countries.

  Journal of Economic Literature (JEL) code: Q48

• The Risks of Global Financial Markets and the Importance of Credibility: Implications for Hungarian Fiscal Policy

  27-44

  Dora Gyorffy

  Views:

  105

  The central issue in the controversy about the adoption of the euro in Hungary is the difficulties associated with the fulfillment of the fiscal criterion and the possible growth sacrifice it requires. In this paper the author examines the question whether the strategy of delaying entry into the euro-zone implies that fiscal consolidation can be delayed as well. In approaching the problem the paper considers the origins and history of the present-day global financial markets and argues that given the high degree of systemic risks individual countries face responsible macroeconomic policies are crucial in minimizing vulnerability to
  crises. Consequently in order to avoid excessive interest rates and speculative inflows (or currency crisis in the worst case scenario) fiscal deficits in Hungary would have to be cut and credibility of fiscal policy reestablished even without EMU accession. The overall conclusion from this overview is that delaying entry in order to delay fiscal adjustment is likely to increase the trade off between real and nominal convergence instead of mitigating it.

  JEL classification: F33, F41, H62

• The examination of the relationship between foreign working capital investment and economic growth on the basis of European examples

  150-166

  Eva Nagy

  Views:

  122

  In the past decade several studies have been published in Hungary as well on the role of foreign working capital investment and the economic effects of the presence of multinational companies. This paper explores what role working capital investments (their type, size etc.) have played in the transformation and modernization of Hungary and in her integration into world trade. After a short theoretical and historical survey it presents the experience of some European countries which the literature often mentions by comparing them to Hungary, for on the basis of their size, population, geographical location and level of economic development they have often met similar economic policy dilemmas and choice-making. Then it examines what effects foreign working capital influx had on the given economies and - ina wider sense - on their social development, and in addition, what kinds of undesirable consequences it had.