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Firm Performance and the Political Economy of Corporate Governance: Survey Evidence for Bulgaria, Hungary, Slovakia and Slovenia

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  • Patrick Paul Walsh
  • Ciara Whelan

Abstract

Using survey data for 220 traditional manufacturing firms over 7 years of transition and 4 CEE countries we show that firms which produced for the EU market under planning consistently outperform those that traditionally produced for the CMEA market. A gradualist selection process to outside privatisation of previously CMEA oriented firms induces outside ownership to outperform insider/state owned firms. A resistance to outside privatisation in firms inheriting EU markets ensures that ownership structure has no effect on firm performance. Conditioning our analysis on initial demand conditions helps unravel puzzling empirical outcomes in relation to issues of corporate governance during transition.

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Bibliographic Info

Paper provided by LICOS - Centre for Institutions and Economic Performance, KU Leuven in its series LICOS Discussion Papers with number 8599.

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Length: 35 pages
Date of creation: 1999
Date of revision:
Handle: RePEc:lic:licosd:8599

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Keywords: Privatisation; Political Economy and Firm Performance;

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References

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Citations

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Cited by:
  1. Marko Simoneti & Joze P. Damijan & Matija Rojec & Boris Majcen, 2004. "Case-by-case versus Mass Privatization in Transition Economies: Owner and Seller Effects on Performance of Firms in Slovenia," LICOS Discussion Papers 14304, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  2. Faggio, Giulia & Konings, Jozef, 2001. "Job Creation, Job Destruction and Employment Growth in Transition Countries in the 90's," IZA Discussion Papers 242, Institute for the Study of Labor (IZA).
  3. Stefan Bojnec & Ana Xavier, 2004. "Entry and exit in transition economies: the Slovenian manufacturing sector," Post-Communist Economies, Taylor & Francis Journals, vol. 16(2), pages 191-214.
  4. Sergei Guriev & Barry W. Ickes, 2000. "Microeconomic Aspects of Economic Growth in Eastern Europe and the Former Soviet Union, 1950-2000," William Davidson Institute Working Papers Series 348, William Davidson Institute at the University of Michigan.
  5. Jozef Konings & Ana Xavier, 2002. "Firm Growth and Survival in a Transition Country: Micro Evidence from Slovenia," LICOS Discussion Papers 11402, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  6. Schnytzer, Adi & Andreyeva, Tatiana, 2002. "Company performance in Ukraine: is this a market economy?," Economic Systems, Elsevier, vol. 26(2), pages 83-98, June.
  7. Richard B. Goud Jr., 2002. "Ownership and Firm Performance: Evidence from 25 Countries in Central and Eastern Europe and the Former Soviet Union," Development and Comp Systems 0207002, EconWPA.
  8. Karen Crabbé & Michel Beine, 2009. "Trade, Institutions and Export Specialization," LICOS Discussion Papers 23409, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  9. Fiona Burke & Patrick Walsh, 2012. "Regional earning disparities and the speed of transition: evidence from Poland 1994–1997," IZA Journal of Labor & Development, Springer, vol. 1(1), pages 1-19, December.
  10. Konings, Jozef & Van Cayseele, Patrick & Warzynski, Frederic, 2003. "The Effect of Privatization and Competitive Pressure on Firms' Price-Cost Margins: Micro Evidence from Emerging Economies," CEPR Discussion Papers 3703, C.E.P.R. Discussion Papers.
  11. Bang, James T., 2007. "Determinants of the method of sale in privatization," Economic Systems, Elsevier, vol. 31(3), pages 272-291, September.
  12. Saul Estrin & Alan A. Bevan & Boris Kuznetsov & Mark E. Schaffer & Manuela Angelucci & Julian Fennema & Giovanni Mangiarotti, 2001. "The Determinants of Privatised Enterprise Performance in Russia," William Davidson Institute Working Papers Series 452, William Davidson Institute at the University of Michigan.
  13. Bhaumik, Sumon Kumar & Dimova, Ralitza & Nugent, Jeffrey B., 2011. "Off-farm labor supply and labor markets in rapidly changing circumstances: Bulgaria during transition," Economic Systems, Elsevier, vol. 35(3), pages 378-389, September.

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