Analysis of the Hungarian SME structure by circular statistics tools
Domestic SMEs give much more weight to local factors in their location choices than large companies. The study investigated whether the structure of the domestic SME space can be captured by a geographical distribution according to compass points. Hungarian studies on this topic mainly use a gravity model, which most often can only represent a single force vector, although the number of vectors is infinite, only the magnitude of the force varies. To represent all directions, a circular statistical tool was used that is less well-known in the Hungarian economic literature and financial data of Hungarian SMEs were analysed. This method allows to capture a new dimension of the domestic economic spatial structure that is not possible with other methods, thus opening new analytical perspectives. The results show that, starting from the centre of Hungary, the spatial structure of SMEs is dominated by a north-south counter-pole rather than an east-west one, as several Hungarian spatial structure researchers have suggested. This can be explained by the fact that the capital city, when viewed from the centre of the country, results in a north-west concentration, which is prevalent in most SME segments. The northern dominance of circular distributions is also prevalent when Budapest is removed from the sample, which further reinforces the north-south polarisation phenomenon. This configuration is modified only in a few sectors, such as accommodation services, where specific geographical considerations determine the choice of location.
De-globalisation and changing value chains? An interpretative experiment in the context of technological cycles
Global value chains are estimated to account for 30-50 percent of world trade. These networks have become a prominent organisational model in the context of globalisation. The speed of their expansion has been marked not only by the growth of world trade but also by the growth of foreign direct investment flows. Both processes came to a halt after 2008. Some argue that this indicates a reversal in the process of value chains and globalisation. Others see only a slowdown. This paper argues that the transformation of global value chains has remained limited despite the economic shocks and policy shifts after 2008. The change in the trend of the data series has been at least as much influenced by the emergence of a new internet-based economic paradigm. The main business model of the new paradigm is no longer the traditional global value chain, but the platform economy. Its expansion is not linked to an increase in world trade or foreign direct investments. This argument is also supported by the fact that the decline in value chain indicators is mainly observed in the US economy. This is where the new technical-economic paradigm is developing fastest, with most platform-based firms being American.
State-driven electromobility: the role of the state in the development of the EV industry in China
ÁGNES SZUNOMÁR – TAMÁS PERAGOVICS – AGNIESZKA MCCALEB – WENXUAN SONG
The study examines the role of the Chinese state in shaping the competitiveness of the electric car industry. Recognising the unsustainability of resource-intensive growth and the domestic economic growth based on it, the Chinese state is actively supporting emerging industries to promote the green transition. The electric car industry is a good example of these efforts. Drawing on theories of ecological modernisation and state industrial policy, this paper presents China’s policies and plans to promote the development of this industry. The cooperation between state and industry in the field of electric automobiles (EA) will allow economic prosperity to remain the cornerstone of the Chinese Communist Party’s performance and legitimacy, while reducing the environmental burden of China’s economic rise and contributing to the country’s global competitiveness, all in a technology-intensive industry. The study provides data on several companies, but also uses the example of one company – BYD – to demonstrate the functioning of the Chinese support system and the wider situation of the Chinese EA industry. It suggests that the Chinese state is seeking global leadership and dominance of the entire value chain by seeking out the strongest players in the domestic market, regardless of their ownership structure, then selecting and subsidising the strongest ones, but phasing out these subsidies over time to avoid rent-seeking behaviour.
Adjustment with lags: the Hungarian economy in 2020 through 2023 and
PÉTER ÁKOS BOD
The performance of the Hungarian economy has widely fluctuated since 2019 due to external components but mainly for policy-related reasons, and factors related to structural rigidities. The analysis covers the potential evolution of relevant external conditions and the inner drivers of the hungarian economic trends. Politicking and regulatory interventions have delayed the economy’s reactions to major changes, thus imbalances have grown large, compared to the region, in recent turbulent years. The increasing share of capital- and material-intensive businesses has resulted in a structure that compromises the speed and timeliness of adjustment processes. A highly critical issue of the post-2023 period will be the capability of Hungary, with its evolving economic structure, to adjust to the new normal in European macroeconomics as well as to face emerging technological, geopolitical, climatic, and social challenges.
Review on the book of
Péter Ákos Bod: Economic development and knowledge. Essay on the links between business culture, values, and education (Gondolat Publishing House, Budapest, 2023, 200 pages)
In the book, relying on his previously published articles on the subject, the author explores the factors of economic catching-up with the developed Western countries. Even the articles, published several decades ago, are strikingly timely. The key finding of the volume is that the success of a country’s catching-up efforts is determined by the social embeddedness of civic values and the development of human capital.
The investment and export promotion strategy of East Central Europe, with regard to its changing legal environment
As a result of the increased EU competence under the Lisbon Treaty and the Court of Justice of the European Union’s decision in the Achmea case, which has a Slovak dimension, on 6 March 2018, international investment protection law is undergoing a significant change in the EU context, with implications for economic policy in all member states. This paper analyses the EU regulatory environment affecting the investment promotion and protection strategies of Hungary, Poland, the Czech Republic and Slovakia from a legal perspective. These Central and Eastern European countries are also members of the Visegrad Group, and the extent to which the interests of this sub-regional group of countries have been and can be pursued under EU regulation is examined.