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Integration of the CEE agri-food sector into the EU: What does trade theory and empirical evidence tell us?
62-77Views:135The article provides an overview on the main results of empirical research into the Integration of the CEE agri-food sector into the EU. Contrary to early expectations, countries in the region have not become major agri-food exporters. We can observe great diversity in trade specialisations, the patterns of intra-industry trade and price and quality competitiveness among countries and major product groups. These outcomes derive mainly from the differences in relative factor endowments and the different initial conditions of the countries concerned. The recent theoretical and empirical developments in international
trade may help us to better understand the agri-food trade integration of new member states.JEL classification: Q12
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Limits of Economic Theories in Border Research
98-116Views:143The paper approaches the possible consequences of further trade liberalization, integration and the disappearance of borders from the perspective of well-known economic theories. After putting forward the questions and hypotheses, the author shows the different conclusions of economic approaches in the case of further integration and disappearing borders in borderlands. Using the results of economic theories the paper outlines the development path of those spatial units where state borders still play an important role in forming economic interactions. It comes to the conclusion that only regional reshuffling
can be mentioned in relation to further integration. The paper also draws attention to the fact that economic theories do not give clear-cut and comprehensive answers for development, so the economic approach could be too simplistic. Consequently, a wellelaborated empirical research programme could provide a genuinely nuanced picture of the development path of borderlands.Journal of Economic Literature (JEL) classifications: F15, O18, R12
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Deep vs. Shallow Integration. The Case of NAFTA and Mercosur
68-82Views:154Integration processes began in the 1960s and have become increasingly intense, bringing with them a growing share of intra-industry trade flows in international trade. According to the Smooth Adjustment Hypothesis (SAH), trade between similar industries or products results in lower adjustment costs in the factor markets. Due to the liberalizing effect of trade integrations trade flows intensify, causing an increase in intra-industry trade flows and consequently a decrease in adjustment costs at the same time. The alteration of trade patterns can be caused by changes both in quantity and in quality. Analyzing these effects separately allows us to better understand the trade policy practices of the chosen countries and to provide the decision makers with information.
In this paper we analyze NAFTA and Mercosur, two integrations which differ both in factor endowments and in depth of integration (deep vs. shallow). We used SITC Rev. 1 AG3 (industrial level) and HS92 AG6 (product level) bilateral trade data from the UN COMTRADE database to analyze the evolution of intra-industry trade flows.Journal of Economic Literature (JEL) classifications: F13, F14, F15
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The role of France in the economy of the EU
207-224Views:100The author examines the decisive role of France within the EU. After a preliminary examination of the principles of European integration and its historical development, the article analyses the netwrok of connections existing between the EU and the French economy, as well as the period of growth and retrenchment in its development. The main theme of the article is the debate over the stability and growth pact and the circumstances and consequences of the failure to comply with the pact's rules caused by the France's long-lasting budget. This failure calls into question, and in the long term may be fatal for the future of European integration and for the direction of a common supra-national economic policy and the national responses it requires. The common European currency, and the stability and future of the Euro are also affected, since this failure can influence the co-operative efforts of the various elements of the European Union in an unprecedented way. It also affects the relationships bewteen the smaller and larger countries, and the economic opportunities of all member states.
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The influence of intra-industry trade on adjustment costs and the synchronisation of boom cycles
61-82Views:111For researchers studying intra-industry trade and the methodology involved in measuring the phenomenon one of the most important driving forces was the assumption that the creation of economic integration would lead to lower adjustment costs than were characteristic of the traditional commercial model. Another result was that - according to empirical data - intra-industry trade would receive a strong incentive from liberalisation, and that the accompanying adjustment costs would be lower than in cases there there was specialisation bewteen branches. In so far as this is demonstrable, proponents of attempts to achieve general integration offered a convenient weapon to their opponenets, who consistently argued back that it was precisely the difficult application of this process and its drawn-out and 'painful' nature that caused high costs. The first part of the article is devoted to a discussion of this debate, while the second part focuses on the role intra-industry trade plays in harmonisation with business cycles. The article shows that an examination of the intensity and dynamism of intra-industry trade allows a much more sophisticated analysis of a country's position in the world economy than is usually possible.
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The future of Russian outward foreign direct investment and the eclectic paradigm: What changes after the crisis of 2008–2009?
31-54Views:146This article explores the future of Russian outward foreign direct investment in the aftermath of the crisis of 2008–2009. As it is too early to analyse the full impact of the crisis, it develops hypotheses about the degree of slowdown in the foreign expansion of Russian transnational corporations. It uses an extension of the eclectic paradigm to home country advantages (competitive environment, business environment, development strategy, State involvement) applied to a comparison of the Russian Federation with other economies in transition as an analytical tool. Systematic differences between transnationals from the Russian Federation (global firms, based on natural resources, aiming for vertical integration of assets) and from new European Union member countries (regional firms, based on downstream activities or services, aiming for horizontal integration) allow us to formulate more solid conclusions about the future of the Russian firms facing lower export prices, lower market capitalizations and higher debts. In turn, this article argue that a comparison with the large emerging economies of Brazil, China and India, under the acronym of BRIC can be less useful in the current context, as these economies are significantly less affected by the crisis of 2008–2009 than the Russian Federation; hence they can not expect a slowdown in their outward foreign direct investment similar to that of Russian transnationals.
JEL: F23; F21; O52; P29
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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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A német transzferrendszer mint a gazdasági visszaesés okozója
Views:172According to the theory of optimal currency areas the most important advantage of monetary integration is its positive effect on economic growth. However, examining Germany we can notice that since German reunification economic growth and the convergence between East and West Germany has slowed down. These facts show that the operation of the German currency union is not optimal and its performance has not improved over the last twenty years. The criteria of the optimal currency area theory is endogenous due to the recent development of the theory. This means that a country is more likely to satisfy the criteria for entry into a curreny union ex post than ex ante. In the case of Germany, examining the trends of economic growth we can conclude the the German currency union has not become optimal in the last two decades. These facts raise the puzzling question of what are the specific circumstances hindering the improvement if Germany's monetary union despite the endogeneity of the optimal currency area criteria. To answer this question the study examines the interactions between monetary and political integration with special attention to the issues of fiscal policy. According to the study the German transfer system and the dependency on transfers explain the discrepancy between theory and empirics.
Journal of Economic Literature (JEL) classification: E42, E62, E63, F01, F31, F36
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Examining the perception of innovative online banking services – a discrete choice experiment among university consumers
64-91Views:298In our study, we examine consumer preferences for innovative online banking services among students in business and management education. To achieve our research goal, we conducted a discrete choice experiment with the target group. The alternatives of our hypothetical decision situations included in our experiment were characterized by the possibility of ATM smartphone integration, the availability of real-time banking, the availability of NFC payment, and the cost per transaction. Based on our model estimates, we found that all three examined services (ATM smartphone integration, real-time banking, NFC payment) have a positive perception among respondents, while the increase in cost has a negative effect on the respondents’ sense of utility. The results of the latent class model estimated in order to address the preference heterogeneity highlighted the existence of a consumer group with very strong preferences and thus a high willingness to pay (average HUF 70) towards the existence of the NFC service. Male students with a non-Debrecen resident in higher-level vocational training are more likely to be included in this class.
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Strategic market entry barriers in Hungary
91-107Views:202This study is a continuation of a former project of the same research team. The focus of the research is market entry in Hungary for foreign firms, along with strategic entry barriers to both domestic and foreign importers to Hungary. A comparison of our findings from 2003 and 2008 gives some insights into the integration of the Hungarian domestic market into the Single European Market. Practical advice is offered to Hungarian market players on the scope of strategic entry barriers in Hungary as well as the ways entrepreneurs assess them.
JEL classification: F13, F14, F15
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Individual Values for Organizational Success
37-51Views:110Douglas McGregor published Theory Y in 1960. The main element of this theory is integration of individual and organizational objectives. Today, near 50 years later, the integration of individual and organizational goals remians only theory in several business organizations. The author of this study conducted an online survey in 2008 in order to examine company cultures, values was harmonization between organizational-level and individual-level sets of values. Two multinational companies with 324 respondents took part in the research up to this time. This publication shows the findings of the survey and illustrates the importance of harmonization between organizational-level and individual-level values. Finally, it comes up with some ideas what leaders can do in order to harmonize the value hierarchies efficiently in their organizations.
JEL classification: D21, L21, L25
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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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Human Capital and EU-Enlargement
83-92Views:84The enlargement of the European Union is an almost everywhere accepted necessity, but at the same time of course also a compromise. Economies or regions of different economic, social, institutional, etc. development become united in Europe with a territory from the Atlantic to the Eastern borders of Poland, Slovakia and Hungary, from the Baltic Sea to the Mediterranean Sea. This integration process going along with the worldwide globalisation will imply a new distribution, or a redistribution of the factors of production. First of all the human capital will be touched by this development.2 One of the most important results found by social sciences in the 20th century is the realisation of the immense role played by human factors in the process of economic development. The extremely high efficiency of human capital and the high mobility could diminish the regional differences in the economic development and therefore in the social life. But even this is one reason for the mentioned re-allocation of the human capital. In the frame of a very simple static model (See e. g. Bishi – Kopel [2002]) the flow of human capital between different regions – called the European Union and the New Member States – will be analysed. The introduction of search costs extends the field of policy-analysis.
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The Monetary Union and the policitcal unification in Europe
96-104Views:126The article deals with the European Economic and Monetary Union's connection with politics. The author examines how the Monetary Union came to be with the help of the traditional integration theories and also what answers can be gained from them on the question of politically unification. He shows how the Werner-plan, mentioned as the forerunner of the EMU, helped in forming the Union in the light of the theory of optimal currency areas. He points at the problem around European fiscal federalism. In order to elevate the mostly underrated economic powers, he uses the Mundell-Fleming model to illustrate the economic relations behind the Union, which, to some extent, stand in contrast with the way of behaviour driving back to political thinking.
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The examination of the relationship between foreign working capital investment and economic growth on the basis of European examples
150-166Views:104In 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.
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European rights in the Hungarian legal system
67-72Views:114With the accession to the European Union, European rights became part of the Hungarian legal system, and have prority over Hungarian laws in the same areas. Regular courts make use of European law in situations where their own law is unclear. Nonetheless the integration of European law into the Hungarian legal system is not without problems: the Constitutional Court is in a trap, because the priority of European law does not apply to it. thus it can only examine the constitutionality of a law originatiing from Europe in the context of how it affects the Hungarian Constitution. The Hungarian legal system must conform to European norms, so legal harmonization is necessary. This requires precise and well-thought-out law-making, while European rules are often simply 'copied' into a Hungarian law, thus ruining the inner logical structure and consistency of the Hungarian law. Behind these problems lies the fact that European law has undergone an 'overdevelopment', and has not been consistently thought through.
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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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Analysis of Fiscal Policy in the Countries of the PaCifiCa
109-126Views:117Volatility has been a main factor in Latin America for decades, but these countries have managed to eliminate it more or less successfully by a series of reforms over the last few decades. Regional integrations have emerged in response to the challenges of globalisation. The most recently created integration is the PaCifiCa, and it is worth analyzing the current fiscal situation of its member states, which largely determines the success of future cooperation. Although the four countries observed managed to survive the 2007-2009 crisis with stable fundamentals, the downturn drew attention to the differences between these countries: while Chile and Peru are able to react easily to cyclical swings by applying countercyclical policy, the economies of Colombia and Mexico are much more vulnerable. The assessment of the welfare systems shows that although Chile has an extensive welfare system, the countries in the region still significantly lag behind the traditional concept of welfare state.
Journal of Economic Literature (JEL) code: H50, H60
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The Effect of Globalization on the Transmission of Monetary Policy
161-178Views:120Investigating how globalization and the new technological environment which drives and supports the integration process affect the monetary transmission mechanism, I find that the transmission mechanism is affected at every step, in a way which makes this complex linkage between economy and monetary policy even more unpredictable, strengthening the interest rate and wealth affects but weakening the credit channel and the exchange rate channel, if foreign exchange rate loans or carry trades are significant.
Journal of Economic Literature (JEL) Code: E44, E52, F42
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Varieties of development paths in post communist countries with special regard to the transition in Hungary
5-25Views:142Transition in Central and Eastern Europe was carried out in various ways. However, the different countries’ current economic structure, institutions and main economic performance measures are rather similar. The question asked is whether these countries follow a specific kind of development model? What seems likely is that they differ substantially from CIS countries in many aspects. But they also seem to differ from existing models of capitalism more than they do from each-other. Based on this information, the varieties of capitalism literature assumes that such a model does indeed exist. However, no comprehensive positive description of the model has so far been provided. This paper tries to define the main elements of the CEE capitalist models. These are small open economies, with close integration into the world economy through foreign investments, a relatively limited and declining role of state redistribution, the problems of dual economic structure and insufficient job creation, a relatively large shadow economy and “business capture”-type cronyism. Further research is required to properly describe the elements and interactions among them.
Journal of Economic Literature (JEL) classifications: D72, E65, P31
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Business Intelligence from a Strategic Perspective
49-70Views:425Business Intelligence is one of the fastest growing sectors of corporate informatics today. The study describes the history of the related approaches, models and applications, starting from the beginning of the last century. The most important growth engines are highlighted and the strategic role of business intelligence is explained in detail. Both the supply and the demand side of the BI market are analysed and key developments and trends are explained. Special attention is paid to explaining and modelling the intensive acquisition activity of the recent past, and to the potential consequences of the growing need for integration. New market and technology trends changing the application landscape are analysed at the end.
Journal of Economic Literature (JEL) classification: M10, M15, M40