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• Exit strategies of family businesses in Hungary

  43-63

  Ágnes Mosolygó-Kiss

  László Kucséber

  Áron Szennay

  Views:

  267

  The 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.

• Political Economy of Fiscal Reform in Central and Eastern Europe

  66-75

  George Kopits

  Views:

  100

  The 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.

• The Concept of Innovative Fiscal Policy: Theory and Empirical Evidence

  Oliver Kovacs

  Views:

  146

  This contribution addresses the question of what are the main constituents of an innovative fiscal policy in the context of sustainability. We apply the concept of sustaining and disruptive innovation to fiscal policy. On the one hand, innovative fiscal policy is able to be sustaining whereby public finance will incrementally improve without leaving its decisive structure. On the other hand, innovative fiscal policy should be disruptive as well in the context of long term sustainability, whereby the structure of public finances can be profoundly restructured as a reaction to future challenges. By using the Finnish recovery in the early 1990s, we can refine our argument about the use and necessity of the mixture of fiscal rules and independent institutions in favour of fiscal sustainability. We also shed light on the key sources of the expansionary consolidation that emerged in the aftermath of the fiscal adjustment in the early 1990s. We emphasise that innovative fiscal policy with a mixture of legislated fiscal rules and independent fiscal anchor is more likely to be associated with sustainability if the economy has weaker growth potential which does not provide enough social trust towards the consolidation efforts of the government.

  Journal of Economic Literature (JEL) classification: E61, E62, Q01

• Twenty-one Economic Arguments against an Unconditional Basic Income

  5-29

  Istvan Csillag

  Peter Mihalyi

  Views:

  383

  In 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

• Corporate Governance from a Post-Communist Perspective

  69-82

  Peter Mihalyi

  Views:

  118

  In the aftermath of Enron and WorldCom scandals of 2001-2002, corporate governance (CG) has been put once again into the center of academic interest. Last time this happened in mid-1997, when a global financial crisis that began in Asia was widely attributed to appalling CG practices in Korea and Japan. Thus, for young readers this whole subject matter may seem to be an old hut. In reality, the term "corporate governance" has merely a 25 year old historiography. Systematic content analysis of the Anglo-Saxon press showed that the term CG arose first in the wake of the Watergate scandal. In the mid- to the late 1970s, public opinion suddenly discovered that major American corporations were involved in corrupt payments both at home and abroad. Prior to Wazergate scandal, competitive markets and good governance of business enterprises had been regarded as two sides of the same coin. It was a tacit understanding that well-run companies are honestly run companies and vice versa. Suddenly this equation was broken. Sence then the fast-growing CG literature has had a moral loading.