IDEAS home Printed from https://ideas.repec.org/p/ehl/lserod/20765.html
   My bibliography  Save this paper

Enterprise adjustment in Poland: evidence from a survey of 200 private, privatised, and state-owned firms

Author

Listed:
  • Belka, M.
  • Estrin, Saul
  • Schaffer, M. E.
  • Singh, I. J.

Abstract

This paper reports the main findings from a survey of some 200 Polish firms carried out at the end of 1993. The central focus is on the relationship between different emerging forms of ownership and the extent and nature of enterprise level adjustments taking place. Four broad categories of enterprises that distinguish the main ownership forms that characterize Polish industry were included in the survey: (a) traditional state-owned enterprises, (b) corporatized state-owned enterprises that have been converted into joint stock companies but whose shares are now owned by the State Treasury; (c) former state-owned firms that have been privatized; and (d) privately-owned firms which were established de novo. Some of the main findings from the survey are as follows. Growth and investment in 1993 were widely diffused through the economy, but rather more concentrated in the private sector and especially in de novo private firms, while financial distress as revealed by low profit margins was concentrated in the state-owned sector. The survey suggests that all firms in Poland have experienced a considerable increase in competition, and have faced the need radically to restructure their patterns of input purchases and marketing strategy. In general, de novo private firms have led the way, and changes have been fewer and less deep in the state-owned sector. Developments on the labor side in our sample are rather modest, and to be heavily oriented to satisfy the preferences of insiders, especially workers. Overmanning remains rife in both the state-owned and privatized sector, and differences between the two groups of firms in wage determination appear to stem more from the operation of the excess wage tax than from differences in motivation. Behavior in the de novo private firms is, however, clearly different, with a concern to hire not fire, and with lower employee influence. With respect to finance, we find that privatized and especially de novo private firms are financially relatively healthy, with higher profits and fewer bad debts than the state-owned firms. Although almost half of private sector firms hold no bank debt, bank credit is flowing fastest to these firms and in general they report the fewest problems in servicing it. Overdue trade credit is common among all ownership groups but more so among state firms; however, the flow problem is not serious, and volumes of total and overdue trade credit are comparable to West European levels. The main method by which severely financially-distressed firms, nearly all of which are state-owned, finance their losses is by running up tax arrears; financing by banks and by trade credit is much less significant.

Suggested Citation

  • Belka, M. & Estrin, Saul & Schaffer, M. E. & Singh, I. J., 1995. "Enterprise adjustment in Poland: evidence from a survey of 200 private, privatised, and state-owned firms," LSE Research Online Documents on Economics 20765, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:20765
    as

    Download full text from publisher

    File URL: http://eprints.lse.ac.uk/20765/
    File Function: Open access version.
    Download Restriction: no

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Cheryl W. Gray & Arnold Holle, 1996. "Bank-led restructuring in Poland: the conciliation process in action 1," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 4(2), pages 349-370, October.
    2. Bilsen, Valentijn & Konings, Jozef, 1998. "Job Creation, Job Destruction, and Growth of Newly Established, Privatized, and State-Owned Enterprises in Transition Economies: Survey Evidence from Bulgaria, Hungary, and Romania," Journal of Comparative Economics, Elsevier, vol. 26(3), pages 429-445, September.
    3. Konings, Jozef & Lehmann, Hartmut & Schaffer, Mark E., 1996. "Job creation and job destruction in a transition economy: Ownership, firm size, and gross job flows in Polish manufacturing 1988-1991," Labour Economics, Elsevier, vol. 3(3), pages 299-317, October.
    4. repec:jpe:journl:1401 is not listed on IDEAS
    5. Pissarides, Francesca, 1999. "Is lack of funds the main obstacle to growth? ebrd's experience with small- and medium-sized businesses in central and eastern europe," Journal of Business Venturing, Elsevier, vol. 14(5-6), pages 519-539.
    6. Schaffer, Mark E., 1998. "Do Firms in Transition Economies Have Soft Budget Constraints? A Reconsideration of Concepts and Evidence," Journal of Comparative Economics, Elsevier, vol. 26(1), pages 80-103, March.

    More about this item

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ehl:lserod:20765. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (LSERO Manager). General contact details of provider: http://edirc.repec.org/data/lsepsuk.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.