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Spillover effects and business linkages of foreign-owned firms in Hungary

Author

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  • Miklos Szanyi

    (Institute of World Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences)

Abstract

The supplier links of foreign-investment enterprises (FIEs) started to develop as soon as they commenced operations in Hungary. Thus, their interest in developing local roots was already clear. Empirical evidence has shown that some FIEs outsourced only a few services, while others tried to outsource as much of the production as they could.The analysis of the Hungarian linkage promotion package showed that the early years of operation did not bring a breakthrough and the new system is still under development. It was therefore difficult to find matching case-study evidence, i.e. case studies that contain some information about the usage of this particular development programme. However, there is plenty of evidence about linkages where the research is case-study based. Empirical surveys agree that Hungarian suppliers play an appreciable, if fairly small role in FIE activity. The scale of the contribution lags far behind what is found in developed countries, especially if foreign-owned suppliers are ignored. On the other hand, it is markedly higher than in the developing countries. The studies also agree that there is an increasing tendency, although the barriers on the side of Hungarian would-be suppliers are considerable, especially for SMEs.

Suggested Citation

  • Miklos Szanyi, 2002. "Spillover effects and business linkages of foreign-owned firms in Hungary," IWE Working Papers 126, Institute for World Economics - Centre for Economic and Regional Studies.
    • Handle: RePEc:iwe:workpr:126
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    References listed on IDEAS

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    Cited by:

    1. Bačić, Katarina & Račić, Domagoj & Ahec Šonje, Amina, 2004. "FDI and economic growth in Central and Eastern Europe: Is there a link?," MPRA Paper 83136, University Library of Munich, Germany, revised Nov 2004.
    2. Harald Zschiedrich & Hanno Kunzmann, 2005. "Regionale Industriecluster als Hoffnungsträger wirtschaftlichen Wachstums," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 31(2), pages 229-254.
    3. Bačić, Katarina & Račić, Domagoj & Ahec Šonje, Amina, 2004. "The effects of FDI on recipient countries in Central and Eastern Europe," MPRA Paper 83263, University Library of Munich, Germany.
    4. World Bank Group, 2016. "Special Economic Zones in the Dominican Republic," World Bank Publications - Reports 26103, The World Bank Group.

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