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Various changes in ownership structure in the past five years have
reflected the influence of political factors on government priorities in
Hungary. By mid-1993, widespread renationalization had successfully
re-established state control of many firms. The effects of this
mandatory corporatization and the earlier `spontaneous privatization' on
enterprise behaviour appear broadly similar. In Discussion Paper No.
916, Éva Voszka argues, however, that the two types of companies
that result differ in their form and thus also in their interests.
`Spontaneous privatization' strengthened enterprise management's
proprietary rights vis-à-vis a weak structure of central
administration. It also diversified investors, even within the state
sector, by involving banks and partner companies as shareholders,
although many of the resulting `holdings' then had to sell their shares
or assets to survive. Centralization, in contrast, is creating a
monolithic, administrative proprietor intent on re-establishing its
direct influence. Managers may nevertheless prefer formal subordination
to state ownership over strong private ownership, however, if this
promises to bring an end to political threats and an opportunity to
enforce their own interests by assuming the proper managerial role long
denied them under central planning. |
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