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• Hungary's dependence on external financing

  145-156

  Monika Kuti

  Views:

  73

  This paper demonstrates that Hungary has been dependent on external financing for several decades. In the 1970s and 1980s, debt was prevelant in the external capital structure of the Hungarian economy, but since the transformation to a market economy internation equity finance has reahced a level of capital accumulation and plays a very complex role in export potential, debt srvicing capacity and the modernization of the country. This paper argues that in general the forced increase in domestic demand is not able to substitute for the inherent need to realize export surplus in a small open economy in the long run. In the subsystem of the real economy there is a self-financing circuit driven by foreign direct investments which can meet the economy's current liabilities and profit remittance requirements, while this circuit cannot compensate for the consequences of the soft budgeting constraints of the general government.

  JEL classification: H6, F4

• Implementing Risk Adjusted Capitation Payments with Health Care Reforms in Hung

  147-160

  Balazs Nagy

  Agnes Brandtmüller

  Views:

  177

  Since the late nineties Hungarian governments have been considering the introduction of new health care arrangements by establishing organizations with devolved responsibilities for the management of health care. These organizations are typically financed through a weighted (risk adjusted) capitation system which is regarded as an adequate and optimal tool for resource allocation purposes. Through capitation one needs to handle large inequities in the Hungarian health care system and keep an eye on the incentives for efficiency. For the capitation formula a relatively broad choice of risk adjusters are available in the form of pharmacy- and diagnosis-based patient level utilization data (health-based adjusters) and area level socio-economic data (non health-based adjusters). The instant application of health-based adjusters has limitations because they reflect a distorted provider structure and offer perverse incentives; therefore a gradual shift from using non health-based adjusters to health-based adjusters is preferred. The early phase of the capitation system also implies a strong presence of risk sharing arrangements and other complementary policies. Given that promoting efficiency and equity are to be pursued, the capitation approach outlined in this paper should serve as a guide to future Hungarian health care system reforms.

  Journal of Economic Literature (JEL) code: I28, G28, G32, H51