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The Reversal of the Privatisation Logic in Central European Transition Economies (An Essay)

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  • Miklós Szanyi

    () (Institute for World Economy, Centre for Economic and Regional Studies, Hungarian Academy of Sciences, Budapest
    Budapest Business School, Budapest)

Abstract

The main ambition of this study is to explain the unexpected change in the transition process of some Central and Eastern European (CEE) countries starting in the second half of the 2000s. Special attention is paid to changes in and the attitudes of governments toward state ownership. Although statist approaches gained momentum in the economic policy of various states in and after the 2008/2009 crisis, this did not mean a fundamental reorientation expressed in changes in the main economic conditions such as ownership patterns. Nevertheless, governments in some CEE countries seem to flirt with such ideas too in the general policy of increasing state economic intervention. The privatisation process was stopped and in a number of cases, formerly privatised assets were re-nationalised. Governments strengthened their influence in the governance structure in mixed-ownership companies. The main body of the present paper provides a better understanding of this change in state property policies. We also call attention to the risks of a reversal of the privatisation logic. An increasing role of the state as proprietor may today strengthen similar negative political and economic consequences and risks as the ones against which the privatisation agenda of the 1990s was suggested. It can reduce competition, give way for political and personal rentseeking, and weaken the functions of market economic institutions.

Suggested Citation

  • Miklós Szanyi, 2016. "The Reversal of the Privatisation Logic in Central European Transition Economies (An Essay)," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 66(1), pages 33-55, March.
  • Handle: RePEc:aka:aoecon:v:66:y:2016:i:1:p:33-55
    Note: The paper was written within the framework of the research supported by the Hungarian National Research, Development and Innovation Office (Grant No. 112069).
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    Cited by:

    1. Miklós Szanyi, 2016. "From party state capture to party business capture - Model feature of Visegrád countries?," IWE Working Papers 226, Institute for World Economics - Centre for Economic and Regional Studies- Hungarian Academy of Sciences.

    More about this item

    Keywords

    Central and Eastern Europe; privatisation; public property; crony capitalism; rent-seeking; varieties of capitalism;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H82 - Public Economics - - Miscellaneous Issues - - - Governmental Property
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
    • P31 - Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions

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