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• Trust as a Cost Reducing Factor

  74-84

  Anett Hodosi

  Views:

  192

  The current study analyzes the cost reducing feature of one of the well-researched informal institutions, trust. The micro level analysis is followed by a macro level approach, which is aimed at highlighting trust’s direct cost reducing element via transaction costs and its indirect effect through the legal system. As part of the latter an empirical evaluation of 25 European Union countries has been carried out regarding the connection between costs due to administrative burden and trust. On the one hand academic economic literature proves that trust reduces transaction costs, and on the other hand that the effectiveness of the legal system contributes to the decrease of transaction costs. According to our assumption the increase of the level of trust improves the effectiveness of the legal system and via this
  mechanism it supports the reduction of transaction costs.

  JEL classification: D02, E02

• Trust: a transaction cost influencing psychological mechanism

  Laszlo Toth

  Views:

  113

  Our world is more and more characterized by complexity and interdependency. In the developing New Economy it is expected that the role of information and knowledge transfer, along with the role of cooperation, are some of the most important issues. Some psychological mechanisms, such as trust, will be instrumental ingredients of the new economy. It is speculated that the functioning of such complexity-reduction and cooperation-aiding, such a psychological mechanism as trust becomes a focal point of interest. This paper aims to clarify the workings and influence of trust on economic transactions, prices, and cooperation.

  Jorurnal of Economic Literature (JEL) code: D8, L14, P22

• Are business relationships institutions?

  Tibor Mandjak

  Views:

  110

  The question is simple; the answer could be quite complicated. Inter-organisational marketing researchers define business relationships as interactive exchanges between two organisations. Does this mean anything for institutional economists? A business relationship is created by weaving actor bonds, resource ties and activity links. Business relationships exist and change through time. The establishment, development, maintenance, as well as termination of a business relationship all require investments from the participating parties. A business relationship does not exist in an isolated manner, but other market and non-market actors can equally influence it. In reality, numerous other relationships and actors affect business relationships. As a result, these actors indirectly influence business relationships through the change in behaviour of one of the parties within the business relationship. These directly and indirectly affected relationships create a business network. For an organisation business relationships have different functions. External resources needed
  for operation and value creation are fed by them. Value creation for the customer and value sharing with the customer take place in business relationships. They are forms of an organisation’s interdependence. A business relationship is a special form of governance of the partners’ mutual efforts. A business relationship has its own value for each organisation. Each organisation has several business relationships, each with different value. In business markets,
  where buyers are always organisations, the business relationship portfolio is the market itself. Inter-organisational marketing researchers use very different theoretical foundations to study business relationships. Modern contract law based research distinguishes about a dozen norms of behaviour in business relationships. Institutional economic-rooted studies argue that we should use the plural-forms approach (price, authority and trust must be employed together) to explain these very complex phenomena. Research using communication theory concluded that multiple periods of business negotiations were required to develop even primitive norms. The paper concludes with some elements of a possible answer to the title question.

• Mobilizing Social and Organizational Resources in Project Type Cooperation: A Case Study in Networking in Interactive Media Firms

  25-40

  Csaba Mako

  Peter Csizmadia

  Views:

  119

  The paper aims at the identification and interpretation of specific coordination problems faced by project-based work organisations using the example of an interactive portal development for a leading
  Hungarian economic weakly. The study provides a brief overview of the most important theoretical approaches concerning project-based work organisations and the characteristics of the new or interactive
  media sector, which may act as a new model in the fast growing knowledge economy. The interactive portal development is typical of the so-called studio-model of project-based firms (PBF) characterised by
  the novel and singular character of the product or service and by the uncertain and fluid nature of the necessary knowledge and skills. The study calls attention to the project manager’s key role in combining
  formal and tacit skills and in the coordination of actors’ behaviour which is driven by different logics. In addition, the authors stress the importance of the client’s key role in designing and developing the
  interactive media service.

  JEL classifications: L86; M54; Z13

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

  Oliver Kovacs

  Views:

  121

  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

• The role of dynamic relationship capabilities and loyalty in organisational relationships

  76-92

  Erzsebet Hetesi

  Marton Vilmanyi

  Views:

  234

  In this study we try to answer the question of how Hungarian organisations can be depicted in terms of relationship management in networked relationships, and how the nearly fouryear global economic crisis influences the perception of relationship capability and B2B loyalty in organisational relationships. First we review the theoretical background of dynamic relationship capabilities and B2B loyalty, then we show our empirical research results, and we try to identify the factors involved in relationship management and B2B loyalty. From our point of view relationship management has an effect on B2B loyalty, and we support the hypothesis that where relationship management is a conscious action, there are evolved procedures for this. These connected mechanisms have a positive impact on the evaluation of relationship quality and contribute to partners’ loyalty.

  Journal of Economic Literature (JEL) classification: M10, M14, M31, M39

• A critical analysis of dependent companies with partnerships and the legal position of their directors

  101-110

  Emese Toro

  Views:

  75

  In the author's opinion the Hungarian legal system does not at present adequately deal with the special nature in Trust Law of those companies and their directors associated with and dependent on partnerships. These companies, legally independent, but economically connected to partnerships are required to push their own interests into the background in order to achieve common business goals. In the case of real groups of companies regulated by the Companies Act of 1997 only influence gained directly in relation to the given share owned in the partnership is considered relevant. Other formulation of this determining influence are not accompanied by requirement for excess liabilities and the law does not provide for arrangements to protect the interest of small owners and creditors. Accordingly it is the dominant influence that counts and not whether the directing influence is based on the size of the voting rights of the prevailing members or the contract established with the members ie. the shareholders.

• The role of culture in economic growth: an assessment, criticism and paths for future research

  22-44

  Judit Kapás

  Views:

  216

  There is an abundance of empirical literature on the impact of culture on economic development. This literature has been developing at the margin of growth theory and institutional economics. This paper reviews this branch of the literature by structuring it into three main lines, and placing an emphasis on (self)-criticism directed towards it, as well. The author provides some proposals for further steps towards improving the culturegrowth empirical literature, following the two routes identified by the (self)-criticism.

  Journal of Economic Literature (JEL) codes: O43, Z19