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Why Ownership Matters?: Politicization and Entrepreneurship in the Restructuring of Enterprises in Central Europe

Author

Listed:
  • Frydman, R.
  • Hessel, M.
  • Rapaczynski, A.

Abstract

This paper, base on a study of mid-sized firms in the Czech Republic, Hungary, and Poland, examines the sources of performance differences between state and privatized firms, particularly those that may be due to politicization and differences in the degree of entreprenurship. The paper presents empirical evidence that politicization of decision making is responsible for the observed inefficiencies in the cost behavior of state enterprises, but does not explain their inferior revenue performance, which is independent of the degree of state involvement.

Suggested Citation

  • Frydman, R. & Hessel, M. & Rapaczynski, A., 1998. "Why Ownership Matters?: Politicization and Entrepreneurship in the Restructuring of Enterprises in Central Europe," Working Papers 98-14, C.V. Starr Center for Applied Economics, New York University.
    • Handle: RePEc:cvs:starer:98-14
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    References listed on IDEAS

    as
    1. Grossman, Sanford J & Hart, Oliver D, 1986. "The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 691-719, August.
    2. Megginson, William L & Nash, Robert C & van Randenborgh, Matthias, 1994. "The Financial and Operating Performance of Newly Privatized Firms: An International Empirical Analysis," Journal of Finance, American Finance Association, vol. 49(2), pages 403-452, June.
    3. Sherwin Rosen, 1997. "Austrian and Neoclassical Economics: Any Gains from Trade?," Journal of Economic Perspectives, American Economic Association, vol. 11(4), pages 139-152, Fall.
    4. Barberis, Nicholas & Maxim Boycko & Andrei Shleifer & Natalia Tsukanova, 1996. "How Does Privatization Work? Evidence from the Russian Shops," Journal of Political Economy, University of Chicago Press, vol. 104(4), pages 764-790, August.
    5. Pinto, Brian & Belka, Marek & Krajewski, Stefan, 1993. "Transforming state enterprises in Poland : macroeconomic evidence on adjustment," Policy Research Working Paper Series 1101, The World Bank.
    6. Rafael La Porta & Florencio López-de-Silanes, 1999. "The Benefits of Privatization: Evidence from Mexico," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(4), pages 1193-1242.
    7. Frydman, Roman & Gray, Cheryl & Hessel, Marek & Rapaczynski, Andrzej, 1997. "Private Ownership and Corporate Performance: Some Lessons from Transition Economies," Working Papers 97-28, C.V. Starr Center for Applied Economics, New York University.
    8. Frydman, Roman & Gray, Cheryl W. & Hessel, Marek & Rapaczynski, Andrzej, 1997. "Private ownership and corporate performance : some lessons from transition economies," Policy Research Working Paper Series 1830, The World Bank.
    9. Brian Pinto & Marek Belka & Stefan Krajewski, 1993. "Transforming State Enterprises in Poland: Evidence on Adjustment by Manufacturing Firms," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 24(1), pages 213-270.
    10. Andrei Shleifer & Robert W. Vishny, 1994. "Politicians and Firms," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(4), pages 995-1025.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Tatahi, Motasam, 2010. "Enterprise Performance, Privatization and the Role of Ownership in France," MPRA Paper 27056, University Library of Munich, Germany.
    2. Tatahi, Motasam, 2010. "Enterprise performance, privatization and the role of ownership in Austria," MPRA Paper 27053, University Library of Munich, Germany.
    3. Tatahi, Motasam, 2010. "Enterprise Performance, Privatization and the Role of Ownership in Poland," MPRA Paper 27062, University Library of Munich, Germany.
    4. Tatahi, Motasam, 2010. "Enterprise performance, privatization and the role of ownership in Bulgaria," MPRA Paper 27054, University Library of Munich, Germany.
    5. Meyer, Andrew & Pac, Grzegorz, 2013. "Environmental performance of state-owned and privatized eastern European energy utilities," Energy Economics, Elsevier, vol. 36(C), pages 205-214.
    6. Md. Asif Nawaz, 2021. "Impact of Specialization, Ownership Structure, and Size on Cost and Profit Efficiency of US Commercial and Savings Banks," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 11(3), pages 1-4.
    7. Alan Bevan & Saul Estrin & Mark E. Schaffer, 1999. "Determinants of Enterprise Performance during Transition," CERT Discussion Papers 9903, Centre for Economic Reform and Transformation, Heriot Watt University.
    8. Tatahi, Motasam, 2010. "Enterprise performance, privatization and the role of ownership in Belgium," MPRA Paper 27051, University Library of Munich, Germany.
    9. Tatahi, Motasam, 2010. "Enterprise Performance, Privatization and the Role of Ownership in the Netherlands," MPRA Paper 27067, University Library of Munich, Germany.
    10. Tatahi, Motasam, 2010. "Enterprise Performance, Privatization and the Role of Ownership in Italy," MPRA Paper 27059, University Library of Munich, Germany.
    11. Tatahi, Motasam, 2010. "Enterprise Performance, Privatization and the Role of Ownership in Norway," MPRA Paper 27060, University Library of Munich, Germany.
    12. Frydman, Roman & Gray, Cheryl & Hessel, Marek P. & Rapaczynski, Andrzej, 1998. "When Does Privatization Work? The Impact of Private Ownership on Corporate Performance in the Transition Economies," Working Papers 98-32, C.V. Starr Center for Applied Economics, New York University.
    13. Motasam Tatahi, 2013. "Enterprise Performance, Privatization and the Role of Ownership in Finland," Journal of Economics and Behavioral Studies, AMH International, vol. 5(3), pages 122-135.
    14. Tatahi, Motasam, 2010. "Enterprise Performance, Privatization and the Role of Ownership in the UK," MPRA Paper 27065, University Library of Munich, Germany.
    15. Tatahi, Motasam, 2010. "Enterprise Performance, Privatization and the Role of Ownership in Portugal," MPRA Paper 27063, University Library of Munich, Germany.
    16. Tatahi, Motasam, 2010. "Enterprise performance, privatization and the role of ownership in Germany," MPRA Paper 27057, University Library of Munich, Germany.
    17. Jana Fidrmucova, 2000. "Channels of Restructuring in Privatized Czech Companies," Econometric Society World Congress 2000 Contributed Papers 1358, Econometric Society.
    18. Tatahi, Motasam, 2010. "Enterprise Performance, Privatization and the Role of Ownership in Sweden," MPRA Paper 27066, University Library of Munich, Germany.
    19. Tatahi, Motasam, 2010. "Enterprise Performance, Privatization and the Role of Ownership in Denmark," MPRA Paper 27064, University Library of Munich, Germany.
    20. Tatahi, Motasam, 2010. "Enterprise performance, privatization and the role of ownership in Finland," MPRA Paper 27055, University Library of Munich, Germany.
    21. Motasam Tatahi, 2012. "Enterprise Performance, Privatization and the Role of Ownership in Bulgaria," South-Eastern Europe Journal of Economics, Association of Economic Universities of South and Eastern Europe and the Black Sea Region, vol. 10(2), pages 131-153.
    22. Zhao, Lexin & Fang, Hongsheng, 2022. "Investment incentives and the relative demand for skilled labor: Evidence from accelerated depreciation policies in China," China Economic Review, Elsevier, vol. 73(C).

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    More about this item

    Keywords

    OWNERSHIP ; PRIVATIZATION ; HUMAN CAPITAL;
    All these keywords.

    JEL classification:

    • P10 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - General
    • P12 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Enterprises
    • P17 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Performance and Prospects

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